GST reforms the Logistics Sector

The implementation of the GST has led to a much needed reform in India’s largely unorganised sector of logistics and transport. According to industry executives, GST has helped speed up movement of trucks.
Transporters and logistics players say that the switch to GST led to at least 20% reduction in turnaround time of trucks after border check posts were dismantled. Besides, they said, implementation of the e-way bill on consignments of Rs 50,000 and above was gradually freeing them from unnecessary checking by state government raid parties.

However, they said, full benefits of GST would only be realised with seamless passage through the currently clogged toll gates, along an end to harassment by state transport and tax authorities. The impact was much more in Uttar Pradesh, Bihar, Madhya Pradesh and Maharashtra, which were particularly difficult states for truckers to move through a year ago.

A recent survey has also found the TAT (turnaround time) in road transport to have successfully reduced by 18-20% since the implementation of GST. There have been signs that introduction of GST is rapidly leading to reduction in time wastage and harassment at interstate borders.

However, according to SP Singh, senior fellow, Indian Foundation of Transport Research and Training, a lot of states were late in implementing the e-way bill. He added that Maharashtra and Punjab implemented it only recently and would take another quarter to fully assess the impact of the same. Road transport and highways minister NitinGadkarisaid that the sector had benefited most from GST. According to him, travel time of trucks has come down significantly as the country has become a common market with removal of border check posts in states. He emphasized on ease of transportation being the focus area.

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