GST will be PM Narendra Modi govt's biggest achievement, says Assocham

Said 'clean-up' of the subsidy disbursal process was yet another big plus of the government

Progress towards realising the pan-India single tax system, the Goods and Services Tax (GST), will be the biggest achievement of the Narendra Modi-led government, industry organisation Assocham said on Sunday.

As the NDA government completes three years in office, besides the GST that was nearing a roll-out, its other achievements on the economic front would be financial inclusion, digitisation and public investment on infrastructure — railways and power distribution, the Assocham said in a release.

"The implementation of the GST in the next few weeks would cap other major initiatives of the government," said Assocham President Sandeep Jajodia.

Perceived as another credible step for structural changes in the economy was the focus on improving ease of doing business through measures like the GST and other taxation reforms, he added.

The GST Council at its 14th meeting held in Srinagar on Friday announced the fitment of services, as well as of 1,211 goods in the GST tax rates, heading towards the proposed July 1 roll-out.

The next meeting of the Council to decide on the rates of the remaining six goods items, including gold and beedi, was slated to be held here on June 3.

Assocham said the "clean-up" of the subsidy disbursal process was yet another big plus of the government, which is pursuing to link Aadhaar ID with every bank account holder.

Helped by favourable fall in the crude oil prices, elimination of subsidy on petrol and diesel and significant reduction in other fuels, including cooking gas, have brought a great improvement in the balance sheets of state-run oil marketing companies, it said.

India's foreign exchange reserves have touched an impressive high of $372 billion, boosting the rupee value, which is helping tame inflation further, it added.

Following several measures to open up foreign direct investment (FDI) in key areas like defence, insurance, infrastructure, the country has received record net FDI of $100 billion in the last three years, while foreign funds are pumping in huge liquidity into the stock market.

"Riding on ample liquidity and confidence of the global fund managers, India's market capitalisation has crossed a massive $2 trillion, so much so that some kind of caution is needed to handle such inflows," Assocham said.

"While, a high level of banks' non-performing assets (NPAs) remains an area of concern, the government has taken some decisive measures like empowering the Reserve Bank of India to set up Oversight Committees and refer the toxic assets for insolvency and all these should help resolution of the nagging problem," it added.