Transportation Charges GST Rate: What You Must Know

Published on November 3, 2025

• 7 min read

Did you know that about 70% to 75% of India’s GST revenue for the year 2023-24 came from the 18% slab? Moreover, approximately 13% to 15% of India’s Goods and Services Tax (GST) revenue was collected from the 28% slab. This means that a significant amount of revenue is generated from GST on transportation, and, yes, your trucking bill is a substantial contributor to this number.

As the Goods and Services Tax (GST) came into effect, significant changes have been made to the taxation system for transportation, particularly for businesses. This has led to an increased need to understand the details of transportation charges GST rates. Let’s look at what you must know about transportation and GST rates.

Table Of Contents

What is the GST Rate on Transportation Charges?
GST on Transportation: Exemptions
List of Goods Which are Exempted from GST
Transport Charges HSN Code and GST Rate
Better Transportation With Shipping Solutions From WareIQ
Conclusion
FAQs About Transportation Charges GST Rate

What is the GST Rate on Transportation Charges?

Depending on the mode of transportation, such as rail, road, air, or water, a specific GST rate applies. The rate will vary further according to the type of service provided under each mode of transportation.

GST Rate on Road Transport Services

The GST rate is fixed for any road transportation services, firstly, based on the mode of transport and secondly, on the nature of the service. Public modes of transportation, including buses, metros, and trains, are generally exempt from GST. This ensures that public transportation is both easily accessible and affordable for passengers.

When it comes to the GST rate, which will be applicable on taxis and cabs, a 5% GST is levied. Operators can opt to pay 12% GST if they intend to claim an input tax credit (ITC).

Here is a table that explains the different GST rates for road services:

Mode of Transport	GST Rate
Public Transport (for passengers)	0%
Transportation via metered rickshaw, e-rickshaw or cab	0%
Buses (Non-AC)	0%
Buses (AC)	5%
Radio taxis or similar transportation options	5%
Rentals (cars, buses, and coaches)	18%

GST on Rail Transportation Services

Every rail ticket that is issued contains a fixed amount of GST that is decided based on the mode and the service. However, this GST rate is subject to periodic changes.

Here are the GST rates which are applicable for rail transportation services:

Mode of Transport	GST Rate
Sleeper and general class tickets	5%
AC and First Class tickets	5%
Metro tickets or tokens	12%

GST on Air Transportation Services

Transportation via air is also subject to GST rates. The GST rate will change based on the mode of transport and the service availed. Although the GST rate remains standard for all airlines, there can be certain changes.

Here are the GST rates which are applicable for air transportation services:

Mode of Transport	GST Rate
Economy class air tickets	5%
Chartered flight tickets for pilgrimage	5%
Rental services of aircraft or chartered flights (with or without operator	12%
Business-class air tickets	12%

GST on Water Transportation Services

GST is also applicable for transportation via inland waterways. However, there is no provision for Input Tax Credit (ITC).

Here are the GST rates which are applicable for water transportation services:

Mode of Transport	GST Rate
General passenger boats	5%
Ferry services on rivers or canals	5%
Cargo transport (renting or hiring vessels)	18%

GST on Road Transportation Service: GTA

Goods Transport Agency (GTA) is a business entity that specialises in providing transportation services exclusively for goods. It plays an important role in the logistics sector; therefore, under GST, there are compliance requirements for GTA as well. The GST rate applicable to a GTA will vary depending on factors such as the type of goods being transported and the total value of the consignment.

Here is the GST on goods that are transported via GTA:

Situation	GST Rate
If the GTA does not claim the Input Tax Credit (ITC)	5%
If the GTA does claim the Input Tax Credit (ITC)	12%

Forward Charge vs. Reverse Charge Option For GTA

Goods Transport Agencies (GTAs) can choose to pay GST themselves under the forward charge rate for the transportation charges system. In this case, they charge either 5% GST without claiming an input tax credit (ITC) or 12% GST with ITC after submitting a yearly declaration.

If the GTA doesn’t choose this option and goes with 5% GST without ITC, then the reverse charge rate on transportation under the GST system applies. That means the person or business receiving the service must pay the GST, not the GTA.

GST on Transportation: Exemptions

There are various cases where exemptions are provided on the transportation GST rates, and they are listed below:

Any kind of transportation services offered by public transport operators, such as buses, local trains, and metros, are exempt from GST.
If transportation services are provided for passenger goods, specified essential commodities, or passengers via Indian Railways, they are exempt from GST.
If any mode of transportation transports commodities such as milk, food grains and agricultural produce via road, rail or vessel, it is exempted from GST.
When educational or academic institutions provide transportation services for students, staff, or faculty, they are exempt from GST.
If passengers are transported via aircraft from airports located in regions such as the Northeastern regions, the Andaman and Nicobar Islands, Himachal Pradesh and Lakshadweep, they are exempt from GST.

List of Goods Which are Exempted from GST

GST does not apply to specific transport services, especially those involving essential goods and activities. These exemptions are granted for the following categories:

Transport of goods for unregistered individuals or through non-GTA (Goods Transport Agency) services.
Movement of agricultural produce and eco-friendly inputs like organic manure.
Distribution of registered newspapers and periodicals.
Delivery of essential food products, including rice, flour, pulses, milk, salt, and other staples.
Shipment of relief materials meant for victims of natural or man-made calamities.
Transportation of military and defence-related items.
Household goods moved during personal relocations.
Freight services where the total charge does not exceed ₹1,500.

Also check – Difference Between Transportation and Logistics

Transport Charges HSN Code and GST Rate

The Harmonised System of Nomenclature (HSN code) is a classification system useful for taxation purposes. The transportation charges, HSN code, and GST rate are interrelated. Under the GST regime in India, the GST rate and the HSN code differ from one mode of transportation to another.

Here is the list of HSN codes applicable to different modes of transportation:

Mode of Transportation	HSN Code
Road Transportation	996511
Rail Transport	996512
Air Transport	996513
Water Transport	996514
Pipeline Transport	996515

Better Transportation With Shipping Solutions From WareIQ

WareIQ’s smart shipping solution helps eCommerce brands minimise cost leakages caused by RTOs, fake delivery attempts in NDR, weight reconciliation issues, and more. Our solution also offers prompt support for handling urgent client escalations, ensuring smooth operations at all times.

Our solution offers the following capabilities:

Multi-carrier engine enabling fast deliveries across 24,000+ pin codes
Control Tower & automated workflows to minimise NDR & RTOs
Same/Next-day delivery courier options
Seamless Integration with your WMS, ERPs and Storefronts
Shipping Badges to display precise Estimated Delivery Dates (EDD)
Custom-branded tracking pages and notifications to enhance customer experience.

Conclusion

The GST rate on transportation charges might be confusing, but businesses need to understand it to make more informed and cost-effective decisions. Usually, the GST ranges from 0% to 18%. The GST slab will depend on the type of service, mode of transport, and whether or not you claim the ITC. However, some services, such as public transport, agricultural goods, and materials, are exempt from GST. This allows access to such services while also being affordable. On the other hand, premium services and freight movements will also be subject to increased GST rates. When it comes to good transport agencies (GTA), they are allowed to choose between the forward charge GST rate for transporters or the GST rate on transport under reverse charge as per their preference.

FAQs About Transportation Charges GST Rate

Are all transportation services subject to GST?

No, not all services are subject to GST. Essential and public services, such as railways or non-AC buses, as well as the transportation of basic goods, are exempt from GST.

What GST rates apply to GTA?

GTAs can select between 5% without ITC and 12% with ITC. It depends on the chosen tax scheme and tax declaration.

Is GST applicable to cab services, such as Uber?

Radio taxis and AC taxis will attract 5% GST.

Does transporting household goods attract GST?

No, the transportation of personal household goods is exempted from GST.

Supercharge your fulfilment with WareIQ now, contact our team.

Author

Mariyam Jameela

Mariyam Jameela works as a content writer at WareIQ. With a proven track record of working with renowned brands such as GO Digit, Urban Ladder, Juspay, Hong's Kitchen, and many more. She actively contributes to the creation of blog posts centered on eCommerce operations, fulfillment, and shipping, in addition to providing insights on various strategies and techniques tailored for eCommerce sellers

Read all of Mariyam Jameela's Posts

Top 4 Inventory Valuation Methods Explained with Examples

Inventory valuation is essential for accounting and financial reporting purposes. The method by which a business values its inventory can impact several other key aspects, including cost of goods sold (COGS), gross profit, applicable taxes, and the balance sheet. According to accounting standards, having the correct method and applying it consistently is crucial. In this article, we will examine the top four inventory valuation methods, accompanied by relevant examples.What Does It Mean By Inventory Valuation?Inventory valuation is essentially the accounting process of assigning a monetary value to a company's assets, including its stock. In simple terms, inventory valuation determines how much your inventory is worth at a given point in time. On the balance sheet, inventory is recorded as a current asset.On an income statement, the cost of inventory sold during a period is recorded as Cost of Goods Sold (COGS), which impacts gross profit.Why Inventory Valuation Methods Matter?Inventory valuation has several benefits, such as:Inventory is often one of the most significant current assets on a company's balance sheet. Misvaluing inventory can distort both profit and financial ratios.With inflation (or deflation), different methods produce very different values for ending inventory and COGS, thus affecting net income.Standards (GAAP, IFRS) require the disclosure of the method used and consistency. If there is a change in the inventory valuation methods, it must often be disclosed and sometimes applied retrospectively.To assess the financial stability of a business for loan approval, it is based on the company's balance sheet and the valuation of its inventory.Inventory valuation can also impact the tax a business pays.Correct inventory valuation can provide essential data that helps inform strategic decision-making for future purchases and effective inventory management.What Are the Various Methods of Inventory Valuation?Inventory valuation can be performed using different recognised methods, which will ultimately affect the Cost of Goods Sold (COGS), ending inventory value, and overall financial reporting in various ways. Here are 10 methods of inventory valuation that are widely used:1. FIFO (First-In, First-Out): Assumes the oldest inventory is sold first, so the ending inventory reflects the most recent costs.2. LIFO (Last-In, First-Out): Most recently purchased items are sold first; the ending inventory reflects the oldest costs. Allowed under US GAAP, prohibited under IFRS.3. Weighted Average Cost / Average Cost Method: This method uses a weighted average of all the inventory costs, no matter if it is ending inventory or COGS.4. Specific Identification Method: Tracks the actual cost of each item sold, ideal for high-value or unique goods.5. Retail Inventory Method: Estimates inventory value using a cost-to-retail ratio, standard for retailers.6. Lower of Cost or Market (LCM): In this method, the inventory is recorded at the lower of historical cost or market value to prevent overstatement.7. Net Realisable Value (NRV): Here, inventory is valued at the estimated price minus costs to complete and sell.8. Replacement Cost Method: This method values inventory at the cost to replace it; it is majorly used for insurance or risk assessment.9. Standard Cost Method: The method uses predetermined standard costs for inventory, comparing actual costs to standards to record variances.10. Gross Profit Method: This method estimates ending inventory based on historical gross profit percentages, often for interim financial reporting.The Top Methods of Inventory Valuation: Examples IncludedBusinesses rely on various inventory valuation methods to determine key aspects, such as the cost of goods sold and the ending inventory value. Amongst the different inventory valuation methods, here are the top four that are mainly used by businesses:1. FIFO ((First-In, First-Out)Under the FIFO method of inventory valuation, older inventory is first sold out before new inventory is procured. Eventually, the ending inventory signifies the most recent purchase costs. This method aligns closely with the physical flow of goods such as food, perishable items, or cosmetics.In times of inflation, the FIFO method of inventory valuation results in a lower cost of goods sold because older and cheaper inventory is sold first, leading to higher profits. However, this also means a higher taxable income compared to other methods, such as LIFO.Let us understand this with an example:DateUnits PurchasedCost per UnitJan 1100$10Feb 15200$12May 1100$15These are the purchase inventory at different time periods.If the company sells 250 units, then, as per the FIFO method of inventory valuation:The first 100 units sold are from the Jan 1 batch at $10 each = 100 x $10 = $1,000The following 150 units sold are from the Feb 15 batch at $12 each = 150 x $12 = $1,800Hence, the COGS = $2,800.Whereas, the ending inventory is:Remaining 50 units from Feb 15 batch = 50 x $12 = $600100 units from May 1 batch = 100 × $15 = $1,500So, the ending inventory = $2,100.2. LIFO (Last-In, First-Out)In the LIFO method of inventory valuation, it is assumed that the most recently acquired items are sold first, leaving the older inventory on the balance sheet. This method is mainly used in environments with rising prices, as it assigns the latest, higher costs to the Cost of Goods Sold (COGS).While it may reduce tax liability, LIFO can make the balance sheet inventory appear understated, as older, lower-cost items remain in inventory.Let us understand this with an example:DateUnits PurchasedCost per UnitJan 1100$10Feb 15200$12May 1100$15These are the purchase inventory at different time periods.If the company sells 250 units, then, as per the LIFO method of inventory valuation:The first 100 units sold are from the May 1 batch at $15 each = 100 x $15 = $1,500The following 150 units sold are from the Feb 15 batch at $12 each = 150 x $12 = $1,800So, the COGS = $3,300Whereas, the ending inventory is:Remaining 50 units from Feb 15 batch = 50 × $12 = $600100 units from Jan 1 batch → 100 × $10 = $1,000Thus, the ending inventory stands at $1,600.3. Weighted Average Cost Method (Average Cost Method)In the average cost method of inventory valuation, the average cost of all inventory available for sale during a period is applied to both COGS and the ending inventory. This method smooths out price fluctuations over time, making it particularly useful for businesses with large volumes of homogeneous items where individual tracking is impractical.Contrary to FIFO or LIFO, there is no specific flow of goods. It helps simplify accounting and also reduces the impact of sudden price changes. Let us understand this with an example:DateUnits PurchasedCost per UnitJan 1100$10Feb 15200$12May 1100$15These are the purchase inventory at different time periods.Total units available = 400Total cost = 100×10 + 200×12 + 100×15 = $4,900Weighted average cost per unit = $4,900 ÷ 400 = $12.25If the company sells 250 units, then, as per the average cost method of inventory valuation:COGS = 250 × $12.25 = $3,062.50Ending Inventory = 150 × $12.25 = $1,837.504. Specific Identification MethodThe specific Identification method of inventory valuation assigns the actual cost of every specific item sold to the Cost of Goods Sold (COGS). It is therefore the best inventory valuation method. This approach is ideal for high-value, unique, or easily distinguishable items, such as cars, jewellery, or artwork, where tracking individual units is feasible. This method provides highly accurate profit reporting. However, the drawback is its administrative burden, making it impractical for businesses with large volumes of identical items.Let us understand this with an example:ItemCost PricePhone A$500Phone B$700Phone C$600This is the stock of 3 phones in the inventory.If the store sells Phone A and Phone C:COGS = $500 + $600 = $1,100Ending Inventory = Phone B = $700Which is the Best Inventory Valuation Method?The choice of the best inventory valuation method for your business will depend on several factors, such as:The nature of the inventory.The cost volatility.Tax environmentRegulatory environmentAdministrative capacityFinancial presentation goalsFor many businesses, a combination of FIFO or the Weighted Average method works. However, if there are exceptional items, then a specific identification method becomes more relevant.Get an Accurate Evaluation of Your Inventory With Various Tools From WareIQWareIQ is a Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfillment across D2C, Marketplaces, Quick Commerce, and B2B (General Trade & Modern Trade)Our solution offers:Pan-India network of Seller Flex & FAssured compliant across 12+ cities operated by WareIQ, and shipping partners for last-mile delivery across 27000+ pin codesMulti-Channel Fulfilment Platform with plug-and-play integrations across marketplaces (Amazon, Flipkart, Myntra, Nykaa, etc.), D2C platforms (Shopify, Magento, WooCommerce, etc.), WMS, and ERPs, to support fulfilment across distributors, flagship stores and eCommerce channels with analytics capabilities to assess operational performanceInventory LogIQ: AI-led multi-channel inventory planning solution to minimise stockouts and automate replenishmentLeverage the Tech-enabled returns QC solution to capture, centrally store, and auto-index HD media evidence of damaged or missing returned products and eliminate marketplace claims rejections.A host of seller enablement and support - dedicated account manager, APOB/PPOB registrations, GST registration, NDR & COD verification, etc.ConclusionInventory valuation is not just another accounting task; it is a strategic decision that will have an impact on various aspects of a business, such as profits, taxes, and financial reporting. The top inventory valuation methods include FIFO, LIFO, Weighted Average and Specific Identification. Each method has unique advantages tailored to your business's specific requirements. The correct method can help to optimise profits, manage costs, and gain a competitive edge.Suggested - 7 Inventory Management Techniques: Exploring FIFO, FEFO, and LIFO MethodsFAQs About Inventory Valuation MethodWhich method is best for perishable goods?FIFO is the most suitable option, as it ensures that older items are sold first.Can a company change its method of inventory valuation?Yes, but changes must be disclosed and justified in financial statements.Which method is most accurate for determining the value of high-value items?Specific Identification, because it tracks actual costs per item.How often should inventory valuation be reviewed?Regularly, at least annually, or whenever significant cost changes occur, to ensure accurate reporting.

November 05, 2025

What Is a Parcel Management System and Why Do You Need One?

The e-commerce logistics market in India is rising at a quick rate. In fact, by 2027, the e-commerce logistics market in India is expected to reach USD 11.48 billion. With this growth, billions of parcels are expected to be shipped annually across different regions. Still, a report suggests that approximately 20-30% of the parcels fall into the 'return to origin' category due to delays or misrouting.This is where a Parcel Management System steps in. A Parcel Management System (PMS) provides the centralised visibility and control businesses need to navigate this complexity, reduce costs, and deliver superior customer experience in an increasingly competitive market.Today, we will explore what a Parcel Management System is and why it is essential to have one available.What is a Parcel Management System (Introduction)?A Parcel Management System (PMS) is a digital platform used to streamline, track, and optimise the end-to-end process of shipping parcels. It helps simplify the handling of incoming and outgoing parcels. Instead of juggling multiple courier dashboards, spreadsheets, and emails, businesses can use a PMS to manage all parcel-related operations from a single interface.A PMS helps in:Booking of shipments with multiple carriers,Tracking the parcel status in real time,Parcel management, auditing, and consulting help identify hidden costs by auditing invoices.Managing return-to-origin (RTO) casesAnalysing shipping data to optimise future decisions.In simpler terms, whether you're an e-commerce brand, a 3PL provider, or even a retail store handling online orders, a Parcel Management System acts as the backbone of efficient parcel shipping management.Features of the Parcel Management SystemA Parcel Management System or PMS, is not only about tracking deliveries. It is a complete logistics optimisation tool. Utilising the right PMS can help businesses reduce costs, minimise errors, and improve customer satisfaction. Here are some of the key features of PMS:Centralised Dashboard: A PMS provides a single dashboard where you can book shipments, monitor statuses, manage returns, and generate reports in real-time.Real-Time Parcel Tracking: A PMS integrates with carriers to provide end-to-end tracking with live status updates and automated notifications for both businesses and customers.Multi-Carrier Integration: A PMS enables you to connect with multiple carriers simultaneously. This enables more thoughtful decision-making; you can choose carriers based on cost, speed, or region.Automated Shipping Labels & Documentation: From generating AWBs (Air Waybills) to customs documents for international shipping, a PMS automates the paperwork, reducing manual errors and saving time.Invoice Auditing & Cost Management: A PMS includes parcel management auditing and consulting features that verify courier invoices, flag discrepancies, and ensure you only pay for what's accurate.RTO & Returns Management: With a Parcel Management Software, businesses can track, analyse, and reduce RTO rates by identifying patterns and addressing customer issues proactively.Data Analytics & Reporting: Modern PMS solutions feature analytics dashboards that display shipping costs, delivery performance, RTO trends, and cost management in graphical representations, facilitating better decision-making.Scalability & Small Parcel Management: A PMS seamlessly adapts to your scale, irrespective of the volume. Some platforms even offer specialised small parcel management tools for SMEs and growing businesses.Customer Communication Tools: Modern PMS solutions can seamlessly integrate automated SMS, WhatsApp, or email notifications. This ensures that customers are always informed about their order status, reducing support calls and thereby improving overall satisfaction.Security & Compliance: With parcel data involving addresses, payments, and customer information, PMS platforms ensure data security, GDPR compliance, and secure integrations with carriers.10 Reasons Why You Should Get A Parcel Management SystemConsidering today's logistics industry, managing parcels manually can be highly chaotic and time-consuming. Many e-commerce sellers face challenges like rising shipping costs, return-to-origin (RTO) losses, courier delays, and eventually unsatisfied customers; hence, having a parcel shipping management system has become essential.Here are the parcel management benefits:1. Centralise Your End-to-End Parcel Management ProcessManage all shipments from a single, unified dashboard for enhanced control and visibility.Businesses can avoid juggling multiple courier portals and emails.It will help with bookings, deliveries, and returns in one place.It will considerably reduce errors caused by manual coordination.2. Save Cost With Smart Auditing Businesses can reduce unnecessary expenses by verifying invoices and comparing rates to ensure they are accurate and competitive.Detects hidden courier surcharges or incorrect weights.Compare carrier rates before shipping to choose the most cost-effective option.Leverage parcel management, auditing, and consulting to identify cost leakages.3. Tracking in Real-time and TransparencyProvide customers with visibility and proactive updates. It can help to:Offer end-to-end parcel tracking across carriers.Send automated SMS/email notifications with live status.Build customer trust with accurate delivery timelines.4. Reduce Return-to-Origin (RTO) LossesA Parcel Management System helps to lower one of the biggest concerns for sellers, RTO. A PMS essentially:Will flag high-risk shipments (COD orders, unverifiable addresses).Help to analyse RTO patterns to prevent repeat issues.Manage returns smoothly to minimise financial impact.5. Scale Up SeamlesslyGrow effortlessly without operational bottlenecks, as a PMS can:Supports small parcel management for startups/SMEs.Scales up to handle thousands of parcels daily.Adapts to seasonal spikes and business expansion.6. Get Data-Driven Insights Now, businesses can turn logistics data into actionable business intelligence, as a PMS allows:Access to cost management in the parcel industry graphs for visibility.Monitoring of KPIs like courier performance and cost per shipment.Forecasting demand and optimising carrier selection.7. Better EfficiencyIt is now possible to save time and improve efficiency by automating routine shipping tasks:Generate shipping labels, invoices, and manifests instantly with PMS.Automating courier bill reconciliation.Automation of tasks will free up staff to focus on core business growth.8. Enhanced Compliance and SecurityParcel Management System can help to protect customer data while staying compliant with regulations:Secure integrations with carriers and payment systems.Compliance with GDPR, PCI DSS, and regional data laws.Build customer trust by ensuring the safe handling of parcel data.9. Improving the Customer ExperienceBusinesses can now ensure customer satisfaction by delivering a seamless post-purchase journey to foster loyalty. A Parcel Management Software will help to:Provide accurate delivery ETAs and proactive updates.Helps in the simplification of return handling for customers.Reduce "Where is my order?" support calls.10. Gain Competitive Edge Businesses can outpace competitors who are still managing the parcel manually, as PMS helps to:Deliver faster and more reliably.Lower shipping costs while improving customer satisfaction.Strengthen your market position with efficient logistics.A Parcel Management System doesn't just improve shipping; it helps in boosting the overall efficiency, reduces costs, and enhances customer loyalty, all of which drive long-term growth.Simply Your Parcel Management With Smart Solutions from WareIQWareIQ is a Y-Combinator-backed eCommerce full-stack platform offering multi-channel fulfillment across D2C, Marketplaces, Quick Commerce, and B2B (General Trade & Modern Trade)Our solution offers:Pan-India network of Seller Flex & FAssured compliant across 12+ cities operated by WareIQ, and shipping partners for last-mile delivery across 27000+ pin codesMulti-Channel Fulfilment Platform with plug-and-play integrations across marketplaces (Amazon, Flipkart, Myntra, Nykaa, etc.), D2C platforms (Shopify, Magento, WooCommerce, etc.), WMS, and ERPs, to support fulfilment across distributors, flagship stores and eCommerce channels with analytics capabilities to assess operational performanceInventory LogIQ: AI-led multi-channel inventory planning solution to minimise stockouts and automate replenishmentLeverage Tech-enabled returns QC solution to capture, centrally store, and auto-index HD media evidence of damaged or missing returned products and eliminate marketplace claims rejections.A host of seller enablement and support - dedicated account manager, APOB/PPOB registrations, GST registration, NDR & COD verification, etc.ConclusionParcel handling is not just a back-office task for businesses; it has become a critical business driver. Billions of parcels are shipped each year, and customers expect to receive even better service. Hence, there is no room for delays, hidden costs, and, more importantly, missed deliveries. A Parcel Management System (PMS) solves these challenges by centralising operations, automating routine tasks, reducing costs, and delivering the visibility both businesses and customers need.Whether you run a small enterprise which handles a handful of parcels or a multinational brand handling thousands, the benefits of having a PMS are indeed undeniable. A PMS is a strategic investment that can help your business to stay competitive, agile, and profitable in a parcel-driven economy.FAQS About Parcel Management SystemWhat is a Parcel Management System?Parcel Management System is a software solution that centralises parcel shipping, tracking, auditing, and returns in one platform.Who needs a Parcel Management System?E-commerce brands, retailers, 3PL providers, and any business shipping parcels regularly.What are the main benefits of using a Parcel Management System?The primary benefits include savings, faster deliveries, real-time tracking, reduced RTOs, and improved customer satisfaction.What features should I look for in a Parcel Management System?Multi-carrier integration, auditing tools, analytics, automation, and scalability are essential features for effective management.

November 04, 2025

How to Get an Export License in India Easily

An export license in India refers to the Import Export Code (IEC), a mandatory identification number issued by the Directorate General of Foreign Trade (DGFT). Without an IEC, neither a business nor an individual can export or import goods legally, unless specifically exempted.For service exports, IEC is not required unless the service provider wishes to claim benefits under the Foreign Trade Policy. This makes IEC crucial mainly for goods trade and policy-linked advantages.Since the introduction of GST, the IEC is equivalent to the Permanent Account Number (PAN) of the firm. However, the Directorate General of Foreign Trade (DGFT) still issues an IEC separately upon receipt of an application.Any business entity, including proprietorships, partnerships, LLPs, private or public limited companies, trusts, HUFs, and societies, can apply for an IEC. In this guide, you will learn about the prerequisites for an IEC, the step-by-step process of applying for an export license in India, the required documents, costs, and more.Pre-Requisites for Applying for IEC: Export License RequirementsTo obtain an Import Export Code (IEC), the applicant firm must fulfil certain prerequisites. IEC can be obtained by a proprietorship, partnership, LLP, private or public limited company, trust, HUF, or society.The firm must have a valid PAN, a bank account in its name, and a proper registered address. The Directorate General of Foreign Trade (DGFT) may physically verify the address after issuing the IEC.Before starting the application, it is essential to have your PAN, bank details, and firm details ready.How to Apply for an Export License in India: Step-by-Step ProcessStep 1: Apply for IECTo begin, apply for an Import Export Code (IEC). A PAN, bank account, and valid firm address are mandatory. The DGFT may physically verify the address after issuance. Keep PAN, bank, and firm details ready before applying.Step 2: Link Your Profile to IECIf you already have an IEC, link it to your user profile on the DGFT portal. A digital signature token will be required for this step.Step 3: View IEC ProfileThe IEC profile stores details of your firm as registered with DGFT. Along with the IEC number, it includes RCMC, industrial registration details, status holder details, and past export performance.Step 4. Print IEC CertificateDownload and print your IEC certificate. It contains the firm’s name, address, IEC number, date of issue, and branch details. New certificates also feature a QR code for online verification.Step 5: Update or Modify IECIf any firm details change, please modify them online through the IEC. The system allows for auto-approved updates, ensuring a quick processing time.Step 6: Surrender IECIf you no longer wish to use the IEC, submit an online surrender request. The IEC will be suspended from transactions, but can be reactivated later by revoking the suspension.Step 7: Request Removal from DELIf your IEC appears in the Denied Entity List (DEL), you can apply online for its removal and regain eligibility for DGFT benefits and schemes.Step 8: Revoke Suspension or CancellationIf the IEC has been suspended or cancelled, submit an online request to revoke the suspension or cancellation and resume transactions.Step 9. Manage Users Linked to IECMultiple users can be linked to one IEC. You can add primary or secondary users and assign them permissions to access DGFT schemes.Step 10. Request for Merger/DemergerIf your IEC has been merged or demerged with another entity, please update the system accordingly. Multiple entities can be linked together under this process.Documents Required for IEC RegistrationHere are the documents required for IEC Registration:Valid Digital Signatures TokenValid PAN Valid Mobile Number and Email IDValid Address Details of the Branch OfficeValid Bank Account in the name of the IEC HolderValid Aadhar Card matching the details with the PAN CardAlso check - Types of Export Incentive Schemes & Benefits for Indian BusinessesExport License Cost in IndiaThe primary cost of obtaining an export license in India is the government fee for the Import-Export Code (IEC). Currently, the fee is ₹500, which is a one-time payment. The IEC is valid for a lifetime and does not require renewal.Export-Import Performance: India’s Data BankHS CodeCommodity2024-2025 (IN Cr)% Share% Growth09Coffee, Tea, Mate and Spices45,433.671.226815.8117Sugars and Sugar Confectionery21,182.410.5720-22.2833Essential Oils, Resinoids, Perfumery, Cosmetic or Toilet Preparations22,862.510.6173-6.8052Cotton53,602.901.4474-4.5358Special Woven Fabrics, Tufted Fabrics, Lace, Tapestries, Trimmings, etc.3,107.360.08394.2857Carpets and Other Textile Floor Coverings17,743.680.479114.2595Toys, Games and Sports Requisites; Parts and Accessories Thereof4,820.530.130211.34Source: TradestatExport Management SystemThe Directorate General of Foreign Trade (DGFT), under the FTDR Act, notifies restrictions, quotas, or conditions on specific categories of exports from India. In such cases, exporters must obtain a license or registration before exporting.The Export Management System provides modules for applying for export licenses, quotas, and registrations. These include licenses for restricted items, SCOMET items, and licenses issued under agreements such as the Indo-US Memorandum of Understanding or Indo-EU arrangements.Restricted ExportsCertain items are restricted for export and require prior approval from DGFT. Exporters must apply for an export license through the system before shipping such goods.SCOMET ExportsExports of Special Chemicals, Organisms, Materials, Equipment, and Technologies (SCOMET) listed in Appendix 3 of Schedule 2 of ITC(HS) require a license. Exporters must submit a request online to obtain this approval.Registration Certificate (RC) for ExportFor certain products, exporters are required to obtain a Registration Certificate (RC) prior to exporting. For example, exports involving the USA’s unilateral export crime control items or regional security items require an RC.Suggested read - Import Export Code RegistrationHow WareIQ Supports Exporters in IndiaWareIQ goes beyond fulfillment to help Indian exporters streamline operations, stay compliant, and scale globally. Here’s how:Pan-India Fulfillment Network: WareIQ’s 12+ city hubs and last-mile delivery coverage across 27,000+ pin codes ensure faster domestic distribution before export dispatch.Seamless Multi-Channel Integrations: Plug-and-play integrations with Amazon, Flipkart, Nykaa, Shopify, Magento, WooCommerce, WMS, and ERPs simplify order management across domestic and international channels.Export-Ready Inventory Management: With Inventory LogIQ (AI-driven planning), exporters can avoid stockouts, automate replenishment, and maintain optimal inventory across markets.Returns & Compliance Support: A tech-enabled returns QC solution captures and stores HD media proof, reducing disputes and marketplace claim rejections—key for exporters shipping to strict compliance markets.End-to-End Seller Enablement: Services such as APOB/PPOB registrations, GST compliance, COD/NDR verification, and dedicated account managers empower exporters to focus on business growth, while WareIQ handles the backend.Suggested read - How to Export from India: A Complete Beginner’s GuideFAQsIs an IEC required for exporting samples from India?Yes, IEC is mandatory even for exporting product samples, unless exempted by DGFT.How long does it take to get an export license in India?The IEC is usually issued within 5-15 working days of a successful online application.Do exporters need separate IECs for each branch or business line?No, one IEC is valid for the entire firm and all its branches or units.Can an individual apply for an IEC without being associated with a registered company?Yes, individuals can apply for an IEC using their personal PAN and bank account details if they plan to export or import goods.What happens if an exporter fails to update IEC details?Failure to update the IEC may lead to deactivation, and exporters will be unable to process shipments until it is reactivated.

October 31, 2025