oppn parties There Is No Correlation Between Good GST Collection In November And Reversal Of Economic Slowdown

News Snippets

  • In a first, the Supreme Court recognizes marital rape, although for the limited purpose of allowing married women the right of abortion up to 24 weeks if they conceived as a result of forced sex by their husbands
  • Air India cuts discounts on base fare to students and senior citizens from 50% to 25%
  • Mallikarjun Kharge and Digvijay Singh are being touted as frontrunners to take on Shashi Tharoor in the elections for the post of Congress president
  • Sonia Gandhi will decide who will be Rajasthan CM if she feels there is a need to change guard after the near-rebellion by MLAs in the state
  • Ashok Gehlot bowed out of the race for being Congress president after meeting Sonia Gandhi
  • India has moved to the 40th spot in the innovation index, up 6 spots from last year
  • DGGI has alleged that top insurance companies, banks and NBFCs has committed a fraud of Rs 800cr by claiming input tax credit without underlying supplies
  • The Centre will borrow Rs 10000cr less than planned earlier due to good revenue collections
  • At $23.9bn, India's current account deficit widened to 2.8% in Q1, the worst in four years
  • Stocks continue to flounder on Thursday: Sensex sheds 188 points to 56409 and Nifty 40 points to 16818
  • The 36th National Games were declared open on Thusrday by PM Modi in front of a record crowd in Motera near Ahmedabad
  • Jasprit Bumrah most likely to miss T20 World Cup due to recurrence of back injury
  • PFI's political wing, the SDPI is on EC radar and action will follow soon if discrepancies are detected
  • Ashok Gehlot to meet Sonia Gandhi today, says all issues will be sorted out soon
  • Referring to the PFI ban, most Muslim organizations ask the government to take similar action against right wings organizations like the RSS, Bajrang Dal, VHP and the like
In a landmark order, Supreme Court rules that all women, married or unmarried, are entitled to safe and legal abortion up to 24 weeks of pregnancy as per the MTP Act
oppn parties
There Is No Correlation Between Good GST Collection In November And Reversal Of Economic Slowdown

By Ashwini Agarwal

GST collection for November have shown an increase of 8.5 percent and have crossed the Rs 1 lakh crore mark after three successive months of collections below Rs 1 lakh crore and two successive months of slippage. But there is not much that can be read into the increased collection about the revival of the economy. The simple fact is that collections in November were up due to sales of white goods, cars, garments and footwear, among other things, traditionally purchased by the people in the festival season of Durga Puja and Diwali which fell in October this year. It was also in part due to better compliance after easing of some the rules in the last meeting of the GST Council.

The collections for November this year were Rs 1,03,492 crore which was 8.5 percent more than the Rs 95,380 crore collected in October this year. After a collection of Rs 98,202 crore in August this year, September and October both saw negative growth. The GST collection in those months reflected the economic slowdown which was confirmed by other figures like plummeting sales of cars and two-wheelers and white goods. But the November figures are not an indication of the revival of the economy. We will have to wait for the collection figures for December and January to know about that. If those months also show positive growth, and if manufacturing shows an uptrend, only then can we say that the slowdown is being reversed.

We have seen that the last quarter showed growth dipping to 4.5%, the lowest in 6 years. Manufacturing activity in eight core infrastructure industries contracted by 5.8 percent. These are disturbing figures. Although they do not say that the economy has entered into a recession, they definitely point out that the measures taken by the government have not improved matters in the last quarter. Hence, instead of being buoyed by GST collections for November, the government should speed up the sale of identified PSUs including Air India and bring about further structural reforms.