Positive impact of GST on Road Logistics

Credit rating and research agency ICRA has recently released a comprehensive survey report covering 50 transport companies and 15 end-user firms which examined the impact of GST on logistics business. The survey findings clearly highlight that India’s biggest tax reforms has largely been positive for the road logistics sector.

Shamsher Dewan, Vice-President, ICRA said “As was expected, the removal of inter-state check-posts has resulted in significant reduction in waiting/idle time for trucks, thereby improving their turn-around time and efficiencies, as confirmed by 60% of transporters that we interacted with. As per ICRA estimates, so far there has been about 18-20% improvement in turnaround time because of GST. The impact has been more pronounced in a few states such as Kerala, West Bengal, Maharashtra, Madhya Pradesh and Bihar, which were earlier known for notoriously high waiting time spent at their inter-state borders.”

The report further indicates that the adoption of e-way bill has not been that difficult as it was expected before its implementation. “ The E-way bill, which got implemented from April 2018, too has been received positively by the transporter community. Around two-thirds of transport companies that ICRA interacted with reported that operations have become more systematic, and there is significant time savings and paperwork reduction due to the digitization of processes. A few companies though faced difficulties due to teething problems like technical glitches, limited awareness etc. the overall response to E-way bill has been positive,” the report says.

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