GST reforms may lift deficit by 0.2% temporarily; long-term growth to cushion impact: Report
Emkay Research suggests GST restructuring may raise India's fiscal deficit temporarily. The deficit could reach 4.6 percent in FY27. However, growth benefits should compensate within three years. States' cooperation is crucial for GST changes. Rationalization is justified despite fiscal risks. Ratings upgrades support reform. Consumer inflation might ease. GST simplification will support long-term growth in India.
Emkay Research suggests GST restructuring may raise India's fiscal deficit temporarily. The deficit could reach 4.6 percent in FY27. However, growth benefits should compensate within three years. States' cooperation is crucial for GST changes. Rationalization is justified despite fiscal risks. Ratings upgrades support reform. Consumer inflation might ease. GST simplification will support long-term growth in India.
