Growth in GST collection, exports show that Indian economy is on a revival path

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With the Covid 19 cases dropping in India, the focus on the economy is back as the country stepped into the second quarter of the current financial year. Despite a surge in infection rate and localised lockdowns across the country, a healthy growth in exports and goods and services tax (GST) collections in the current financial year reflect that the economy is well on the revival path. Importantly, sentiments have improved too. </p>
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“Overall Indian economy is doing well. The economic implications of the first wave of Covid 19 and the second have played out differently,” Deepak Sood, secretary general, Assocham, told India Narrative.</p>
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“During the first wave, the world –especially the west—was grappling with the spread of the virus and India too was in a stringent lockdown. This time, it was different with factories and several other business units functioning normally despite the localised lockdowns which has minimised the impact on the economy,” he said.</p>
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However, sources said that further reforms, especially relating to ease of doing business at the state-level, where actual investment takes place, need to be undertaken at the earliest.</p>
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“The government has taken all steps to ensure that the bottlenecks are removed and a conducive business environment is created. These measures have helped businesses but we are watchful and the government is coming up with more steps as and when required,” Gopal Krishna Agarwal, BJP’s national spokesperson on economic affairs said. He added that the government will not deviate from the “good economics is good politics” mantra.</p>
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That apart, last week Finance Minister Nirmala Sitharaman announced a massive Rs 6.29 lakh crore stimulus package with the aim to revive the economy and help the country fight against the deadly Covid -19 pandemic.</p>
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“The Indian economy is well on the recovery track. Sentiments have improved and as the vaccination drive is now picking up, we are hopeful of getting businesses on track.</p>
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Sood also said that the massive shift towards digitisation which has been a direct fallout of the pandemic has also helped in further formalising the economy pushing tax collections.</p>
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“High GST collections will continue with digitisation of the economy,” he said.</p>
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Though in a report, the World Bank said that a rise in hidden debt could pose serious challenges to South Asia including India, experts said that there is no need to press the alarm button.</p>
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“This area is being monitored. While there is genuine concern over rising levels of debt, there is no reason to feel that the situation in India is going out of hand,” Agarwal said, adding that the Reserve Bank of India’s support to “the economy has been exemplary.”</p>