GST to push Indian growth to over 8 per cent: IMF
New Delhi, Apr 28: International Monetary Fund has said the ambitious Goods and Services Tax to be implemented from July 1st would help raise India’s medium-term growth to above eight per cent.
Adding that the reforms being done is expected to pay off in terms of higher growth in the future.
Tao Zhang, Deputy Managing Director of the International Monetary Fund told PTI in an exclusive interview that the government has made significant progress on important economic reforms that will support strong and sustainable growth going forward.
Observing that India is the fastest growing emerging market economy in a region that remains the strongest-growing in the world, Zhang said the IMF believes that India is going to continue to grow at a fast pace, with a projected 6.8 per cent rate for Financial Year 2016-17 and 7.2 per cent in 2017-18. In addition he said, fiscal and monetary policies have helped foster economic stability.
He also said, a key concern for the IMF in India is the health of the banking system, which is still dealing with a large amount of bad loans, as well as heightened corporate vulnerabilities in several key sectors of the economy.
He noted, as India persists with its strong reform efforts, labour market reforms should take priority. He also said, IMF see scope to pursue better targeting and greater efficiency of subsidy and social spending programs through greater use of the trio of Aadhaar unique beneficiary identification, direct benefit transfers, and information technology.