Though the growth of GDP has decelerated sharply in the last quarter to 4.5%, string of reforms undertaken during the last few months will refuel the growth trajectory of the country and we are very much hopeful that growth will rebound in the next quarter, said Dr D K Aggarwal, President, PHD Chamber of Commerce and Industry in a press statement issued here.
The GDP in Q2 FY2020 grew at 4.5% supported by growth in the public administration, defence and other services (11.6%), Financial, Real Estate & Professional Services (5.8%), Trade, Hotel, Transport, Communication &Services related to Broadcasting (4.8%), Electricity, Gas, Water Supply &Other Utility Services (3.6%), Construction (3.3%) and Agriculture, Forestry & Fishing (2.1%). However the mining and quarrying grew at (0.1%) and Manufacturing sector at (-)0.1%.
The recent reforms such as reduction in corporate tax rates, 2-year moratorium on spectrum-related dues, cabinet approval to Industrial Relations Code and special fund for stuck housing projects would enhance production possibility frontiers and generate employment opportunities in the economy in the coming quarter, said Dr D K Aggarwal.
Going ahead, we urge the government to focus more on the demand boosting measures particularly in the rural areas such as boosting the income of the farmers, promoting rural based industries and more handholding to the MSMEs.
At this juncture, transmission of the cut in RBI's policy repo rate by the banking sector becomes crucial to boost the credit growth and to bring down the cost of doing business particularly for the MSMEs, said Dr Aggarwal. Reforms in the direct taxation are required for individuals to boost their personal disposable income so that saving-investment rates are enhanced, said Dr D K Aggarwal.
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