New Delhi: India’s GDP is expected to grow around 7.5 per cent in 2019, industry chamber CII said on Sunday.
“Better demand conditions, settled GST implementation, capacity expansion resulting from growing investments in infrastructure and continuing positive effects of the reform policies undertaken and improved credit offtake especially in services sector at 24 per cent will sustain the robust GDP growth in the range of 7.5 per cent in 2019,” said the chamber.
The positive outlook is buttressed by strong drivers emanating from services sector, infrastructure structure including construction equipment and better demand conditions arising out of election spending, said CII in its report.
The economy had grown at 6.7 per cent in the fiscal 2017-18. During the first half of 2018-19, GDP grew by 7.6 per cent.
The CII said that despite the year 2018 being one filled with external vulnerabilities arising out of rising oil prices, trade wars between major global trading partners and US monetary tightening, the economy outshined as the world’s fastest growing major economy in the year.
It has identified seven key drivers for growth that need to be fostered and suggested policy actions for robust GDP growth to continue in 2019. Among key growth drivers, CII hopes the GST Council will consider extending the tax to currently exempted sectors such as fuel, real estate, electricity and alcohol.
CII outlined that credit availability has been a challenge, particularly for the MSMEs, as credit flow to industry grew by a mere 2.3 per cent in first half of the current fiscal.
“CII submits that the RBI should introduce measures such as revisiting lending restrictions of PCA banks, opening of a limited special liquidity window to meet emergencies of financial institutions, including Mutual Funds besides others to improve liquidity in the system,” it said.
Besides, the process of insolvency resolution has taken shape, the chamber feels the government should consider setting up additional benches of the National Company Law Tribunal to strengthen the judicial infrastructure for easier and faster exit of distressed businesses.
