GDP to face GST hiccups: Economists

However, under GST regime, CPI inflation might decline

The goods and services tax (GST) might adversely affect economic growth in the initial part of 2017-18 before providing a boost from the fourth quarter onwards, economists said.

They added retail price inflation would largely remain unaffected but inflationary expectations would persist as prices would rise for services such as premium air travel and air-conditioned hotels as well as goods such as aerated drinks, hybrid cars and fertilisers. These items have negligible weights in the consumer price index (CPI). 

Rigid inflationary expectations would not allow inflation to decline significantly, though taxes paid on inputs would be reimbursed, which would have