Goods and Services Tax is a step in the right direction which will usher in growth and investment in the country, the industry feels. The Indian economy is likely to grow at an average rate of 7% or more in the coming year, according to the 5th edition of the PwC-FICCI India Manufacturing Barometer: Building Export Competitiveness Survey, launched yesterday.
Mohammad Athar, Partner and Leader – Industrial Infrastructure, PwC, said, “GST is an enabler of growth. It will impact both domestic markets and export growth. Despite the initial implementation hurdles, India Inc is positive that it improve with time and benefit them in the long run.”
The industry believes that the GST will help attract foreign and domestic investment across new locations. It will contribute to improving logistics which includes ease of procuring, enabling efficient supply chains and rationalizing its cost.
At the launch, Puneet Dalmia, Chairman, FICCI Manufacturing Committee and MD, Dalmia Bharat Group, said that despite being the 6th largest economy in the world, soon to take over the UK to be the 5th, India over relies on its domestic markets.
“India is a very large domestic market, very small portion is export, people invest in india primarily to cater to the domestic market. That should change over time. India is still under 2% of global exports and we need to have a larger markets share in exports,” he said.
India’s export market is driven largely by quality, cost advantage and unavailability of a product. To increase our export competitiveness India Inc has started paying more attention to technology integration, Innovation, R&D and backward integration, the report said.
“Exports will be competitive if funds are allocated to enhance industrial clustering and enlarging the scale of industries and catering to both domestic and global markets. GST will be a force multiplier in this effort which will reduce the cost of doing business,” Rajat Kathuria, Director & Chief Executive, ICRIER, who was also on the panel, said.