June 2024 Sees Over 100 Million E-way Bills, Boosting GST Collections

In June, the issuance of over 100 million e-way bills for interstate and intrastate goods transport highlighted robust manufacturing activity in the closing month of the first quarter of 2024-25. This marked the fourth instance of e-way bill generation surpassing 100 million, following May’s 103.1 million and a record 103.5 million in March. Last year, the 100-million mark was reached in October, as reported by the Goods and Services Tax Network (GSTN), responsible for processing GST returns.

Transactions conducted in June will result in high Goods and Services Tax (GST) collections in July, with revenues totaling ₹1.74 trillion for the Centre and states combined in June, consistently exceeding ₹1.7 trillion for four consecutive months. In contrast, GST collections were ₹1.65 trillion in July 2023.

The sustained high e-way bill numbers correlate with positive assessments by purchase managers regarding strong demand conditions and improved freight activities reported by Indian Railways in June. The HSBC India Manufacturing Purchasing Managers’ Index (PMI) rose from 57.5 in May to 58.3 in June, reflecting healthy demand and order flow, based on feedback from 400 manufacturing companies.

Indian Railways noted a 10% annual increase in originating freight loading to 135.46 million tonnes in June, accompanied by an 11% rise in freight revenue. However, the auto sector experienced sluggish sales due to heatwave conditions and delayed monsoons, with retail auto sales growing marginally by 0.73% year-on-year to 1.88 million units in June, according to the Federation of Automobile Dealers’ Association.

Despite challenges in the auto sector, experts anticipate that the growth in e-way bill generation signifies ongoing economic activity. This growth, they suggest, could contribute to sustained economic growth and GST collections, contingent on factors such as taxable supply values and service sector growth. The Reserve Bank of India forecasts a 7.2% economic growth rate for the fiscal year, driven by government capital expenditure, enhanced rural and urban consumption, and optimistic business sentiments fostering investment activity.