NEW DELHI: The government on Wednesday made a fresh push of becoming a global manufacturing hub if the goods and service tax is rolled out timely.
Speaking at the Lok Sabha on Wednesday, Finance Minister Arun Jaitley said that GST rollout could alone push the country’s gross domestic product by 1 to 2 per cent.
Jaitley said that India can see 8 per cent growth as the government is taking a host of steps to boost investment besides reviving stalled projects and pumping in more funds into public sector banks.
“Rain gods have been kinder this year which is expected result in a good harvest,” Jaitley added. The government will pump `70,000 crore into PSU banks, which are grappling with rising NPAs, in the next four years and they will raise another `1.10 lakh crore from the market, making them healthier to finance economic growth, he said.
The GST Bill, which proposes to usher in a uniform indirect taxation system throughout the country, is stuck in the Rajya Sabha because of Opposition protests over various issues.
Jaitley said, “In adverse situation we can touch GDP growth of 8 per cent if banks are recapitalised, GST implemented, stalled projects revived and infrastructure spending improves.” India grew at 7.3 per cent last year and the RBI has projected this year’s growth to be 7.6 per cent.
“This year we are targeting a growth of about 8 per cent. Obviously, when we grow by a larger growth rate, a revenue buoyancy also comes in. The first few months of the current year appear to be giving some green shoots, and one of those green shoots is in the area of indirect revenue,” the Finance Minister said.
While talking about the woes of banking sector, he said steel, power and highways sectors account for maximum non-performing assets.
Jaitley said once banks are capitalised then they become healthy. Then they would be in a position to take the burden of financing the growth of the economy.
In the first quarter, capital expenditure rose by about 17.6 per cent and investment on infrastructure this year is going to be Rs 70,000 crore more.