The Goods and Services Tax (GST) collection in April, which crossed the Rs.1.5 lakh crore mark for the first time, would have brought cheer in North Block, especially as it comes in the midst of all-pervading uncertainty. According to a release of the Union ministry of finance, the GST revenue was Rs.1,67,540 crore in April, which includes Rs.36,705 crore collected on import of goods and Rs.10,649 crore recovered as cess.
The GST collection in most industrialised states has witnessed double-digit growth, hinting that consumption — the mainstay of the growth story — has resumed. It shows that most industries have recovered from the devastating impact of the Covid-19 pandemic. This fact was also attested by the S&P Global India Manufacturing Purchasing Managers’ Index (PMI) numbers, which were released on Monday. In April, the index rose to 54.7, up from 54.0 in March.
The new numbers came as economic activities in almost all key industries improved and expanded at a faster pace with new orders, a private survey showed on Monday. According to the PMI survey, the withdrawal of Covid-related restrictions has enabled factories to scale up production. It, however, noted that there was not any pressure on operating capacities, which as a result did not lead to any significant job creation.
The only concern for the economic policymakers is dealing with inflation, which has been stoked by global supply-side issues. The government could focus on easing supply chain issues to reduce prices to an extent.
However, as the Reserve Bank of India (RBI) said in its recent report, India will take more than 12 years to recover from output losses suffered due to the pandemic, India — governments, industry and people — should be ready to play a long game for the economic recovery and as a country must put its best foot forward....