Mumbai, June 8 2015: The Express Delivery Services (EDS) industry in India, pegged at approximately `167,296 million (as of FY 2015), a key ‘trade enabler’ for the country’s economy, is betting big on the government’s ‘Make in India’ initiative and the booming e-commerce sector. The industry is expectedly offering employment opportunity to 1.7 million people in the country.
At a seminar organized by, Express Industry Council of India (EICI), titled “Delivering Opportunities for ‘Make in India’ and e-Commerce” in New Delhi, the industry voiced that the next phase of growth is likely to come with the implementation of Goods and Services Tax (GST) and allowing exports through the courier channels. E-commerce has become an important platform for micro and small manufactueres/exporters and the rapid progress made by both e-Commerce and small and medium enterprises (SMEs) has opened new vistas for the EDS industry for handling non-document shipments.
Minister of State for Finance Shri Jayant Sinha, key people from revenue and customs department, India Post, ecommerce players and SME’s participated and attended the seminar along with leading players from the express industry.
Ease of doing business i.e movement of shipments within the country and outside was cited as the biggest impediment for the express industry. Central and state legislations governing goods transportation have not kept pace with the explosive growth of e-Commerce and due to the absence of uniform taxation policies between states, e-Commerce shipments face significant hurdles while delivery, consequently impacting the EDS players.
Speaking at the event, Mr. R K Saboo, Chairman, Express Industry Council of India (EICI) said, “The industry is not seeking tax breaks and sops, but simplification of procedures. We believe the expected GST regulations have the ability to standardize legislations and smoothen out operations. However, a definitive road map for the implementation of GST may provide significant immediate relief to issues associated with inter-state commerce. We also want the government to give a special focus on exports from small and medium enterprises as part of their ‘Make in India’ initiative.”
Facilitating ease of exports will give further impetus in encouraging products manufactured in India to be sold in the global market as envisioned by the governments ‘Make in India’ policy.
Small exporters are currently troubled by high delivery cost for shipments outside India as they are required to route their shipments via the cargo route. Foreign Trade Policy (FTP) notification issued in April 2015 permitting exports through courier will address this lacuna. However it is awaiting implementation from Customs. Indian exporters need to be very competitive in their pricing as well as backed by a reliable and efficient supply chain. Therefore, Indian e-commerce exporters prefer an express delivery service as it not only manages small size and low value items for them, but also provide door to door service, tracking of shipments, guaranteed delivery, customs facilitation on cross border trade and provide other value adds like Charges collect, warehousing etc.
Faster implementation of GST
GST might come as a breather and help with the standardisation, simplification and automation of compliance requirements associated with the trading and movement of goods, especially inter-state movement of goods. One of the most important benefits GST has to offer the EDS industry is the automation of most of the compliance requirements (including forms/permits/way bills etc), thereby reducing the cost and effort for the industry. Furthermore, GST would also reduce the need for check posts and improve efficiency of operations for the EDS players by reducing delays and documentation requirements.
Express Industry Council of India is an association that aims to protect and promote the common interests of Express Industry and its members. Its activities include interacting with the Government, the Customs, other Government Agencies and other like-minded bodies. EICI operates the common user express terminals at Mumbai, Delhi and Bangalore international airports for clearance of express shipments. EICI has been successful in eradicating major bottlenecks and delays caused to Express Industry.