Pegging India’s GDP growth at 7.2 per cent in 2017-18 on account of reforms, domestic consumption, and improvement in trade, the World Bank on Monday said that there were signs of a slowdown in early part of last fiscal but a favourable monsoon lifted the economy before being temporarily hit due to demonetisation.
“India remains the fastest growing economy in the world and it will get a big boost from its approach to GST which will reduce the cost of doing business for firms, reduce logistics costs of moving goods across states, while ensuring no loss in equity,” said Junaid Ahmad, World Bank country director in India, adding that overall the impact of GST on equity and poverty is likely to be positive.
Ahmad also said that as a result of the immediate cash crunch on account of demonetisation, a modest slowdown is expected in GDP growth in 2016-17 to 6.8 per cent. “Growth is expected to recover in 2017-18 to 7.2 per cent and is projected to gradually increase to 7.7 per cent in 2019-20,” the World Bank said in its May 2017 India Development Update report, which was released on Monday.
