No Risk Of India Getting Into Stagflation Or Recession: Finance Minister Sitharaman
The Indian economy is showing "positive signs", Sitharaman said, referring to GST collections and PMI figures.
Finance Minister Nirmala Sitharaman said that India is not at risk of getting into a situation of stagflation or recession, as it is understood in advanced economies.
The government is managing inflation and is trying to lower retail inflation from 7%, Sitharaman said while fielding questions on price rise and inflation in the Lok Sabha.
Despite the pandemic and supply chain shocks, India remained the fastest growing country according to World Bank and International Monetary Fund data over the last two years, Sitharaman said.
According to her, India is in a much better position than other countries on the back of efforts by the central bank and the inflation-fighting measures announced by the government.
The Indian economy is showing "positive signs", Sitharaman said referring to healthy GST collections and the Manufacturing Purchasing Managers' Index figures.
The GST collections for July were the second highest since implementation, she said. "July is the fifth consecutive month that the GST collection has remained at about Rs 1.4 lakh crore."
The highest ever collections were in April, when it stood at Rs 1.64 lakh crore.
PMI was at an eight-month high at 56.4 in July from a base of 53.9 in June.
GST Rate Rationalisation
Prices of pulses and other essential goods, which fall under the pre-packed and labelled category, have been subject to 5% GST which came into effect on July 18.
Responding to queries on the rate rationalisation, Sitharaman said that 5% tax will be levied only on pre-packed and labeled goods and not on essential goods sold in loose quantities. Hence, the move will not affect wholesalers who purchase in bulk and sell smaller quantities in loose, she said.
The Finance Minister said that all states had received their GST compensation dues till May 2022, except for the amount due for June.
"We are holding it back until we receive the AG certificate from states and will release the amount for June after that," she said.