Jaitley indicates merger of 12 per cent, 18 per cent GST slabs

Violet Tucker
Декабря 1, 2017

This reversed the trend of continuous deceleration in the nation's economic activity seen in the past five quarters at a time when the government took the controversial decision to demonetise old currency notes of Rs 500 and Rs 1,000 last year and implemented the Goods and Services Tax (GST) in July this year.

"Government's reforms to push economic growth are working (and it) can be seen from that manufacturing has shown robust growth of 7 per cent in Q2 and services at 7.1 per cent", tweeted Finance and Corporate Affairs Minister Arun Jaitley.

The growth in the agriculture slowed to 1.7% compared to 2.3% in the last quarter and 4.1% in the same quarter previous year. This marks the reversal of this trend.

Syncing with recent Moody's upgrade of India's sovereign credit for the first time in almost 14 years, the growth buoyancy comes at a time when the Modi Government has been facing Opposition charges of wrong implementation of demonetisation and GST that disrupted the $2.4-trillion economy.

Earlier this month, rating agency Moody's - which upgraded India's credit rating to Baa2 from Baa3 and changed its India outlook to positive from neutral - said it expected the economy to grow at 6.7 per cent this fiscal and rise to 7.5 per cent in 2018-19. In the fourth quarter of 2013-14, economy had grown at 4.6 per cent. Chief Statistician TCA Anant hinted that the numbers could be revised upwards as businesses uncertain of the new GST regime may have accounted for lesser taxes.

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"Gross fixed capital formation has increased from 1.6 per cent in Q1 to 4.7 per cent in Q2". "But we can not say now whether this will mark an upward trend in the growth rate", Chidambaram added.

Chouhan's statement comes hours after the Ministry of Statistics and Programme Implementation (MOSPI) said India's GDP growth has recovered to 6.3 percent in the second quarter from a three-year low of 5.7 percent in first quarter. Prominent Indian firms had their best profit growth in last six quarters in July-September, according to Thomson Reuters data.

As per the data, electricity and other utilities grew by 7.6 per cent (from 7 per cent in the previous quarter) and trade, transportation and communications expanded by 9.9 per cent (from 11 per cent in the previous quarter).

"Manufacturing growth has been one of the main reasons for the encouraging growth rate figure of 6.3 per cent for 2nd Quarter", he added.

"Indias economic stress continues; GDP far below at 6.3 pc compared to 7.5 pc of Q2 of past year! - a close scrutiny reveals the real picture of the economic mess created by BJP Government", he said in a statement.

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