Indian economy already upbeat and running, highest GST revenue collection of Rs. 1.2 lakh cr in January, IMF predicts 11% growth next fiscal
Delhi: On the day the Finance Minister N Sitharaman is about to present the union budget, the finance ministry has received two steroidal mood enhancers. While the IMF has predicted that India would achieve more than 11% growth in the next fiscal year, there is a news that GST collections in the month of January have reached a record of Rs. 1.2 lakh crore plus.
The GST collections in January 2021 have surpassed the collections of Rs. 1.15 lakh crore in December. For the last four months the GST collections have been more than Rs. 1 lakh crore.
This is a remarkable recovery for Indian economy that has suffered a lot during the corona pandemic and had drawn flak from the opposition as well as the experts for mismanagement during coronavirus pandemic.
India’s economic revival has been phenomenal. Experts say that the best thing about this revival is that it has happened without much of a government intervention. Almost automatically, just like most of the Indians seemed to have acquired herd immunity, economy too seems to have revived rapidly with some deft support from the government.
According to many observers, India is likely to emerge as the fastest growing economy in the next fiscal.
Indications are indeed very upbeat as the Sensex is breaking charts and the demand for fresh credit in the market is shooting up like never before. These are all signs of a boom in the economy.
The Finance Minister N Sitharaman will present the Union Budget 2021-22 in the Parliament today at 11 a.m.
The budget presentation can be watched live here.
The ninth budget to be presented by the Narendra Modi government is likely to focus on job creation and rural development. It is also likely to allocate more fund for different schemes. The idea would be to infuse more money into the system so that the economy recovers fast. Some relaxation in norms relating to foreign direct investment may also be expected.
Coronavirus pandemic and the subsequent lockdown had created an unprecedented situation and India’s growth trajectory had suddenly faltered. So much so that during the two consecutive quarters of FY 2020-21, a sharp contraction in the GDP was observed and there was an obvious downturn in the economic mood.
The Union govt, with a view to improving the condition of the economy, had announced an ‘Aatmnirnhar Bharat’ package.
It was the first time in the history of India, as the PM pointed out, that the government had to present four mini budgets as separate packages in 2020.
In fact, this budget to be presented by the Finance Minister today on February 1, 2021, too should be seen as an extension of those mini budgets.
The Ministry of Finance is upbeat with the news that GST collections have topped Rs. 1.20 lakh crore.
The January 2021 collections are 8% higher than the collections in December 2020. This is a significant marker of a hefty spring back in economy. The GST collection of Rs. 1.2 lakh core is the highest for the country. And it really means a lot for the country.
The finance ministry has confirmed that the gross GST revenue collected in the month of January 2021 till 6PM on 31.01.2021 is ₹ 1,19,847 crore of which CGST is ₹ 21,923 crore, SGST is ₹ 29,014 crore, IGST is ₹ 60,288 crore (including ₹ 27,424 crore collected on import of goods) and Cess is ₹ 8,622 crore (including ₹ 883crore collected on import of goods).
The total number of GSTR-3B Returns filed for the month of December up to 31stJanuary 2021 was 90 lakhs.
The Ministry in its statement said: “In line with the trend of recovery in the GST revenues over past five months, the revenues for the month of January 2021 are 8% higher than the GST revenues in the same month last year, which in itself was more than ₹ 1.1 lakh crore. During the month, revenues from import of goods was 16% higher and the revenues from domestic transaction (including import of services) are 6% higher than the revenues from these sources during the same month last year.”
The GST revenues during January 2021 are the highest since introduction of GST and has almost touched the ₹ 1.2 lakh crore mark, exceeding the last month’s record collection of ₹1.15 lakh crore. GST revenues above ₹ 1 lakh crore for a stretch of last four months and a steep increasing trend over this period are clear indicators of rapid economic recovery post pandemic.
The average YoY growth in GST revenue over the first four months in the second half of the financial year has been 8% as compared to (-) 24% during the first half of the year.
The FM is also expected to allocate a hefty fund to the defence forces keeping an eye on the challenges on Eastern as well as Western borders and the need to reinforce procurements.
China’s defence spending is more than USD 261 billion, while India’s spending is slightly more than USD 70 billions. That means China is already spending around 4 times India’s defence budget. On the other hand, India has to face a two-front challenge as on Western borders Pakistan too remains a big irritant.
Keeping all this in mind, it is almost certain that the FM would allocate a significant amount to the defence budget.
