Economy disrupted by lingering impact of demonetisation, GST roll-out

Businesses are still taking time to adjust in the new tax regime, which would weigh on growth rates

Call it disruption or structural reform, demonetisation (or note ban) did have dampening effects on the economy. However, even as its negative impact was fading by the time 2017-18 began, the announcement of another reforms or “disruption” — the goods and services tax (GST), which was to be implemented by July 1, 2017, shock the economy and businesses. 

The result of these two reforms was evident as the gross domestic product (GDP) growth came crashing down to a three-year low of 5.7 per cent in the first quarter of 2017-18. It was largely because of pre-GST jitters and lingering effects