Economy to grow in vicinity of 7.5 pc this fiscal: Finmin

Enthused by second quarter GDP number, Finance Minister Arun Jaitley today said the growth this year would be better than 7.3 per cent achieved last fiscal.
As per the Finance Ministry projection, GDP growth should be in the vicinity of 7.5 per cent in 2015-16.
"I think the second quarter figures give us a sense of satisfaction... We expect growth this year to be better than last year and even better the next year," Jaitley said.
"Overall, the Ministry is expecting the economy to grow in the vicinity of 7.5 per cent in 2015-16," a late evening official statement said.

It further said the growth is being mainly driven by pick-up in the manufacturing sector, which has grown by 9.3 per cent in the second quarter.
Similarly, the fixed investment is showing a sign of revival as it has grown by 6.8 per cent in the July-September period.

Jaitley said manufacturing sector recorded a "significant" growth of 9.3 per cent in the September quarter despite an adverse global situation and hoped that private sector investments would pick up faster in coming quarters.
He was responding to the GDP growth rate which came in at 7.4 per cent for July-September, higher than 7 per cent in the April-June quarter.

"And when manufacturing starts turning despite globally adverse circumstances, I think that's a very significant figure from our point of view," he said.
The data released by CSO today showed that manufacturing sector grew 9.3 per cent in July-September as against 7.9 per cent in the year-ago period.
Further, the service sector growth is still robust at 8.8 per cent in Q2 of 2015-16, with the trade and transport services leading the way.
He said Indian economy has been able to clock reasonable levels of growth despite the "great adversity" of two successive years of below-par monsoon.
Jaitley highlighted the need for carrying on structural

reforms, saying the focus should be on infrastructure, irrigation and farm productivity.
"We probably have potential to have a growth that is higher than what we have achieved. This 7-7.5 per cent is not our optimum range. The Indian normal is 8-9 per cent category. And it is only when you grow at that pace, you can get rid of poverty," he said.
He spoke of a huge human resource, trained minds as well as a very large market as positives for India.
"We have potential for increasing manufacturing. We have innovative skills. Our labour cost is not rising as they are rising in China. We are not part of factor or transitions that are taking place in China," he said.

The finance minister said the economy the world over is doing badly because of the slump in oil and commodity prices.
The slump "suits us because we are net buyers of these", he said, adding that given these advantages "what we have to do is to put our house in order. I think the first important thing that we have to do is to carry on structural reforms".
Focus, he said, should be on infrastructure sector, irrigation, improving agriculture productivity and manufacturing.
"At the end of the day, what is it that you are asking for is to get that cutting edge that you must grow at 1-1.5 per cent faster than what you are doing today.

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On whether he discussed GST with Congress chief Sonia Gandhi at a recent reception hosted by President Pranab Mukherjee, Jaitley replied in the negative.
GST will subsume all indirect taxes such as excise duty, service tax and sales tax into one uniform rate and the Bill is stuck in the Rajya Sabha where the Congress wants three changes.
"These are informal occasions, and it is not necessary that you get into a discussion at these forums. I certainly didn't have any political discussions," the minister said, adding that he had earlier talked about GST with Congress leaders on several occasions.

Jaitley made it clear that economic legislations are not about BJP versus all and it would be "very good" if the constitutional amendment Bill to roll out GST is passed by consensus.
"... It is very good to have laws passed by consensus. A law like this which impacts taxation structure of India being passed by consensus is our preference, otherwise it can be put to vote," the minister said.
The minister said several important legislations concerning coal, mining and the like were passed by Parliament with support from several Opposition parties with the exception of the Congress.
The Congress has stalled the passage of the Constitution Amendment Bill, derailing the government's plan to roll out GST from April 1, 2016.

Its three demands are a cap on the GST rate in the Constitution itself, removal of the proposed 1 per cent additional tax on inter-state movement of goods and setting up a judicial panel to adjudicate disputes among states.
Jaitley said since coming to power, the NDA government decided not to use retrospective tax legislation to raise revenue. "We promised that no new notices will be sent," he stressed.
A number of issues were allowed to be settled by courts and the government decided not to appeal against the rulings that went against it.
"The spiral effect of that is dozens of cases are now getting settled," he said. "Today, 18-19 months after this government has taken over, there are about 2-3 of those issues left. Personally, I would like to see them sorted out as expeditiously as possible either through a tribunal or judicial process."

Governments have no power to set aside an assessment order, he said, adding it could only be done by judicial procedure.
"There has to be a due process which has to be carried out. Only when assessees are able to establish (that) there is an unfair order, we will accept that verdict," Jaitley added.