Latest Updates: India is at number 35 on the World Bank Logistics Index, which takes into account multiple variables such as customs, infrastructure, international shipments, logistics quality and competence, tracking and tracing, and timeliness. As the plan of Prime Minister Narendra Modi for better standards in ease of doing business, bolstering the economy by way of the ‘Make-in-India’ initiative and looking to bring in increasing amount of foreign investment, it is important for us to analyse India’s logistics backbone accordingly.
GST is expected to boost India’s ease of doing business rankings. The following table represents India’s logistics performance rank under various categories.
|Logistics quality and competence||31||40||38||52||32|
|Tracking and tracing||42||52||54||57||33|
Source: World bank
As per the CBEC guidelines, any movement of goods exceeding the value of Rs 50,000 cannot be made by a registered entity without an e-way bill. This bill can be generated at the GSTN portal or through an SMS. However, with the extent of information solicited by the e-way bill, the industry sees existential challenges in complying with the process requirements.
All consignments of value less than Rs 50,000 are exempted from an invoice at the time of shipment. However, the express delivery service provider still needs to submit details related to the particular shipment on the common portal, before the shipment is moved. This creates an additional liability for the delivery provider, since the value is declared by the customer – the delivery provider is merely an agent to move goods from one location to another. It would be unfair to hold the delivery provider responsible for goods if the value is not the same as that declared by the sender.
It is imperative for us to appreciate the distinct way that India’s EDS model operates. Considering that its services are extremely sensitive to time and accuracy, any lag in the delivery process on account of compliance would be insensitive to the industry as a whole. It is important to take cognisance of the role that the air express industry has played in facilitating India’s trade competitveness.
The bill aims to capture certain information such as vehicle registration number and driver details from express/courier and multi-modal transport operators prior to the movement of goods of consignment. Additionally, when these individual shipments are received at a hub, they are sorted and allotted vehicles depending on cost and time optimization algorithms. Not only is it impossible to give registered vehicle numbers for delivery boys on foot, allotting transport vehicles well before the shipments reach the sorting centre would hamper efficiency, hurt cost and impact delivery commitments.
However, A new bill is required every time a shipment moves from one vehicle to another. In the express industry, which is dominated by real time decisions and cost optimisation, pronouncing the exact path and mapping the same to specific vehicle numbers will be a formidable operational challenge.
Validity of e-way bill
As per the CBEC guidelines, e-way bills come with an expiry date. The validity period of a bill is dependent on the distance the goods have to be transported.
|Less than 100 km||One day|
|100 km < Distance < 300 km||Three days|
|300 km < Distance < 500 km||Five days|
|500 km < Distance < 1,000 km||Ten days|
|More than 1,000 km||Fifteen days|
Once an e-way bill expires, its validity can be extended by notifying the commissioner. The ‘Way Bill’, a state-specific bill that was expected to die a natural death along with VAT, has transcended in its new avatar, the e-way bill.
Considering the modalities of e-way bill are expected to be discussed by the GST council on August 5, 2017, one can only hope the overarching objective of GST, that is the simplification of processes and enabling ease of doing business, will be continue to be the order of the day.
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