New Delhi: Union Finance Minister Arun Jaitley has brushed aside all pessimism on the economy saying the current quarter will show an upward movement in the growth trajectory and that the government has a gameplan in mind.
“In the larger management of an economy, you don't look at one quarter, you look at the pattern across a period,” Jaitley told CNBC-TV18’s Shereen Bhan in an exclusive interview.
The International Monetary Fund (IMF) on Tuesday had lowered India’s growth projection to 6.7 % in 2017, 0.5 percentage points less than its previous two forecasts in April and July, attributing it to demonetisation and introduction of GST.
The IMF also lowered the country’s growth for 2018 to 7.4%, 0.3 percentage points less than its previous two projections in July and April. India’s growth rate in 2016 was 7.1 %, which saw an upward revision of 0.3 percentage points from its April report.
However, Jaitley, who is visiting the US said that the economy is doing well and will pick up in the coming months. He said that important structural changes can have an impact, but there are enough indications of a positive growth.
In the interview with media, the Finance Minister said that IMF and other agencies are expecting the growth momentum in India to continue.
Jaitley said, “The government has a game plan in mind to revive the economy and will announce the measures when ready.”
Regarding the implementation and market situation after the July 1 rollout of the new tax regime, he said that the government is monitoring the situation on a day-to-day basis.
With the GST rates being reviewed in a GST Council meet last week, Jaitley has said the government is now willing to keep the momentum of tweaking GST rates as and when required.
Soon after the GST rates reform, Prime Minister Narendra Modi too had acknowledged the shortcomings of GST rates and said, “We had said we will study all aspects relating to GST for three months, including the shortcomings. And thus, the decisions were taken with consensus at the GST Council.”
In the recent announcement, small and medium businesses have been allowed to file tax returns once a quarter, instead of monthly returns. The compliance burden of SMEs in GST has been cut while eligibility of composition scheme has raised to Rs 1 crore.
Also, GST rates of 27 items have been reviewed by the GST Council, including sliced dry mangoes, khakhra, unbranded namkeen, chapati have also been cut.