There has been a lot of positive vibes coming from several agencies who have been researching over the Goods and Service tax implementation and its after-effects on the nation. In this direction, Rating firm Crisil has suggested that strong boost to India’s domestic consumption in 2016-17. The implementation of 7th pay commission, with reforms like the Goods and Services Tax (GST) to benefit the overall stream.
Pawan Agrawal, Chief Analytical Officer, Crisil said, “Consumption growth will be buoyant in 2016-17. One Rank One Pension (OROP) and7th Pay Commission will give a boost to domestic consumption this year and reforms like GST will further benefit India’s consumption story.”
“So far this year we have seen India’s story led by strong domestic consumption in auto-ancillaries, packaging and pharmaceutical sectors. What is noticeable is that we expect the rural demand to pick up in the second half of the current fiscal,” he added.
According to the reports, the sustainability will continue to be critical as there were hurdles like investment in infrastructure, slow transmission of Reserve Bank of India rate cuts from banks to customers which has to be taken care of.
Agrawal said, “Weak demand still persisted in the real estate and construction sector. Banking sector too still seem to be bogged down by bad loans and for this fiscal, the level of non-performing assets will remain at an elevated level.”
