Breaking News

You are here » Indian-Commodity  :  Economy  :  Demonetisation, GST rollout may have reinforced growth deceleration: CEA


Demonetisation, GST rollout may have reinforced growth deceleration: CEA

Chief Economic Advisor (CEA) Arvind Subramanian has said that the series of reforms initiated by the government like demonetisation and the goods and services tax (GST) may have reinforced the growth deceleration that had already set in. Apart from the growth, he observed that investment, credit, exports and industrial production have also started decelerating sometime in the second quarter previous year. Therefore, he said that they will soon come out from these two policy experiments and get back to the growth path. 

Subramanian further said that India's GDP will bounce back with better credit growth, investment growth and growth in exports, as the country's economy has the potential to grow between 8 to 10 percent and as new tax regime is also stabilizing. He said “I think that we still need to work more to reduce the compliance burden on SMEs. And these are being worked upon. It's an ongoing process.”  On the matter of bringing petrol and diesel under the purview of GST, he noted that ideally everything should come under the new tax regime and also feels that it is absolutely desirable objective that all that has been left out today should at some point come under GST.

Talking on the jobless growth in India, CEA has indicated that three key job generating sectors are under stress. However, he said that there is not enough employment data to make sincere assessment.  Besides, he said that Niti Aayog has come up with a new method of collecting that data and once that happens, they will be in much better position to make an assessment. Moreover, he observed that in the boom period, three sectors did well--agriculture, IT and construction and these were big job generators. Adding further, he pointed out that in current environment, IT is under stress for bunch of reasons and added that same is the case with the other two sectors. Therefore, he stressed that these sectors have to improve for job creation to pick up.

Related News

View all news

CPI inflation hits 6-month high of 2.92% in April

India's retail inflation based on Consumer Price Index (CPI) continued northward journey for third straight month and inched up to a 6-month high of 2.92% in April 2019 due to a spike in food prices, including......

Indian economy to grow at 7% range in current fiscal: Subramanian

Chief Economic Advisor (CEA) Krishnamurthy V. Subramanian has said  that the Indian economy would grow at 7% range in the current financial year (FY20) powered by the effects of the strong structural......

Banks take 57% haircut in 94 cases resolved in FY19: ASSOCHAM-CRISIL study

A joint study carried out by the industry body Associated Chambers of Commerce & Industry of India (ASSOCHAM) and rating agency CRISIL stated that banks have taken a huge 57% haircut in the 94......

Top News

View all news

SRF, NIIT Technologies and United Bank of India to see some action today

SRF has entered into a definitive agreement to sell its Engineering Plastics Business to DSM, the Life Sciences and Materials Sciences Company in an all-cash transaction, amounting to Rs 320 crore. The......

NIIT Technologies concludes sale of 88.99% stake in ESRI India Technologies

NIIT Technologies has concluded the sale of 88.99% equity shares in ESRI India Technologies, India to Environment Systems Research Institute Inc., USA. Consequent to above sale, ESRI India Technologies,......

United Bank of India to raise Rs 1,500 crore by various means

United Bank of India has received approval to raise equity capital not exceeding Rs 1,500 crore in one or more tranches during the financial year by way of Qualified Institutions Placement, Public Issue,......