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

Randall Padilla
December 1, 2017

The growth in construction sector was projected at 2.6% compared to 4.3% in the same quarter previous year.

"The September quarter GDP growth, he added, is quite a significant trend reversal and has been driven by pick-up in manufacturing".

Addressing a press conference in New Delhi, Chief Statistician of India, Dr TCA Anant, said the recovery of GDP growth to 6.3% in Q2 from a 3-year low of 5.7% in Q1, after nearly 5 quarters of decline, "marks a reversal which is very encouraging". It was 7.5 per cent in the September quarter of 2016-17.

"Buoyed by the overall improved GDP number, Finance Minister Arun Jaitley said, "perhaps the impact of two structural reforms â€" GST and demonetisation were behind us".

"Happy that the July-Sep quarter has registered a growth rate of 6.3%".

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.

Former finance minister P Chidambaram, however, said 6.3% growth was "far below the promise of Modi government and potential of the well managed Indian economy". Manufacturing grew 7% while agriculture growth was 1.7%, down from 2.3% in the trailing quarter. "It's possible that anticipating the need for the festive season, most of the production went into the sale and inventory restocking may happen later...inventory accumulation effect may persist in the third quarter as well", he explained.

Gross value added (GVA), a key input of GDP that is tracked by the RBI, rose 6.1 per cent in July-September compared to 5.6 per cent in the June quarter this year and 6.8 per cent in the September quarter of the last fiscal.

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).

"It is likely that when revised estimates are prepared, indirect tax collections for this period may actually be higher than what we have reported", Anant said at a press conference while admitting that the GST introduced a "certain level of statistical challenge" in compiling the growth numbers. The growth in public administration, defence and other services also stood at 6 per cent.

Other reports by AllAboutTopnews

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