Is India Set to Achieve 6.5% Growth This Fiscal Year with GST Reforms?
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Synopsis
Is India on track for a remarkable 6.5% growth this fiscal year? Discover insights from Dr. Arvind Virmani of NITI Aayog, who discusses the impact of GST reforms amidst geopolitical challenges and highlights India's economic resilience over recent years.
Key Takeaways
- India is projected to achieve a GDP growth of 6.5 percent this fiscal year.
- Reforms like GST 2.0 are expected to enhance long-term economic growth.
- Global challenges have not hindered India's economic resilience.
- Dr. Arvind Virmani emphasizes the importance of simplifying compliance.
- The GDP growth rate in Q1 FY26 reached 7.8 percent, surpassing expectations.
New Delhi, Sep 4 (NationPress) Despite ongoing geo-political challenges and tariffs, India is projected to achieve a GDP growth of 6.5 percent this fiscal year. Dr. Arvind Virmani, a member of NITI Aayog, emphasized on Thursday that reforms like GST 2.0 will significantly enhance the long-term growth trajectory of the economy. He noted that the last five years have demonstrated the remarkable resilience of the Indian economy to global shocks.
During a discussion with IANS, the experienced economist mentioned that he has dedicated considerable effort to the GST reforms, expecting them to yield positive outcomes for the Indian economy.
“The Union Budget introduced several beneficial measures, including essential income tax reforms that have been approved by Parliament. The GST reforms are integral to this comprehensive plan aimed at simplifying compliance and improving the ease of doing business,” he stated.
“While simplification requires time for efficiency and positive tax impacts to manifest, I am confident that these benefits will surface,” the economist commented.
He added that the market often anticipates these changes, suggesting that their effects have already begun to emerge.
Regarding the GDP forecast, he pointed out that many experts, including himself, have consistently indicated that the GDP for the current year would hover around 6.5 percent with a considerable degree of uncertainty.
Virmani acknowledged that the 50 percent US tariffs were unforeseen but emphasized the importance of impactful reforms such as GST on both policy and institutional levels. “Many such reforms have been implemented, with more underway,” he remarked.
“Overall, I remain optimistic that we will achieve 6.5 percent growth this year. There is substantial uncertainty, meaning it could fluctuate by ±0.5 percent or even more. The level of uncertainty has indeed increased,” he conveyed to IANS.
Economists have praised the remarkable GDP growth rate of 7.8 percent recorded in the first quarter of the current financial year (Q1 FY26), exceeding earlier estimates of 6.5 to 6.7 percent by the RBI and other institutions.
Point of View
It's crucial to highlight that while the prospects for India's economy appear promising with a projected growth of 6.5%, one must remain cautious due to the inherent uncertainties in global markets. The ongoing reforms, particularly in GST, may pave the way for enhanced economic performance, but vigilance is required to navigate potential challenges.
NationPress
04/09/2025
Frequently Asked Questions
What is the projected GDP growth rate for India this fiscal year?
India is expected to achieve a GDP growth rate of 6.5% this fiscal year.
What role do GST reforms play in India's economic growth?
GST reforms are anticipated to simplify compliance and improve the ease of doing business, positively impacting long-term growth.
Who is Dr. Arvind Virmani?
Dr. Arvind Virmani is a member of NITI Aayog and an esteemed economist with extensive experience in economic reforms.
How have recent geopolitical challenges affected India's economy?
Despite geopolitical uncertainties and tariffs, India has shown resilience and adaptability, maintaining a positive growth outlook.
What was the GDP growth rate in the first quarter of FY26?
The GDP growth rate for the first quarter of FY26 was recorded at 7.8%, exceeding many earlier projections.
