GST Bill passage key to pick-up in economy

Q: How do you see India's economic growth recovering in the next year?

Aveek Paul,

10th December 2015

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Replies (4)

Hi all,
Whats your outlook on the rupee?

Namagiri, Faridabad

10th December 2015

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Hi aeverybody,
The Fed rate decision will come up in a week. What is your expectation and how will it affect capital flows in emerging markets?

Arup rajan, Mumbai

10th December 2015

Comment

Hi Arup,
We are in a much better situation than earlier. The Fed rate hike has been well telegraphed. I think it is going to be the pace of Fed normalisation which is going to have an impact rather than the first rate hike itself.

Sishir,

10th December 2015

Thanks Sisir,
According to you what are the biggest risks and threats that India has to watch out for in 2016?

Arup rajan, Mumbai

10th December 2015

@Arup,
One of the biggest risks is what is happening in China. If there is a large one-off devaluation of renminbi (the system of currency in China) and if there is a sharper slowdown then that will have a negative impact. If the Fed rate hike is not signalled well and if the US increased divert growth considerably, that can have a negative impact on India. But I would also add adverse weather conditions as a big risk both globally and especially to India in 2016.

Bala Subramanium, Bangalore

10th December 2015

Hi Sidhir,
What kind of reforms are you speculating into that 7.9% growth that you are targeting for next year?

Sarith, Noida

10th December 2015

Comment

Hi Sarith,
Being a common people, The reforms that I am expecting to see are GST, which is front and centre in everybody's mind. I want to see a Bankruptcy Code and that law passing through Parliament. I want to see the reforms to the state power distribution companies continue to come through and be implemented. Also, the Monetary Policy Committee of the RBI should be functional.

Over and above, state-level improvements in both land and labour legislations would also be highly beneficial for the economy.

Sajal Das, Kolkata

10th December 2015

Thanks Sajal.
What risk do you see on GST?

Sarith, Noida

10th December 2015

Well Sarith,
Apart from the Constitutional Amendment, the technical requirements passing it through the state legislatures, the GST Council and all of that would need to get accelerated for the GST to come through. And the investors are hopeful that can happen in 2016.

Sajal Das, Kolkata

10th December 2015

Hi,
India's economic growth in 2016 will still remain positive. I think we are in the middle of a seasonal rise, which extends to 2016. It is driven by a softer interest rate environment, some government spending and also a pick-up in private consumption. We are already seeing signs of that and we think that is going to continue in 2016. So growth forecast for next fiscal year is 7.9%, up from 7.5%. So, it is a gradual improvement in activity for next year.

Sishir,

10th December 2015

Comment