Overview
- The government has removed the 12% and 28% slabs, reallocating many items to 5% and 18%, alongside fixes for inverted duty structures and process reforms.
- Companies have announced price cuts and leading automakers report a surge in bookings and sales, though costlier inventory and logistics are delaying full pass-through in some categories.
- Inflation readings have eased sharply, with September CPI at 1.54% and WPI at 0.13%, while GST revenues reached Rs 1.89 lakh crore, up 9.1% year on year.
- The RBI has raised its GDP growth forecast to 6.8% and trimmed its inflation outlook, and the IMF lifted India’s FY2025–26 growth projection to 6.6%, citing the GST overhaul.
- Ambit Capital cautions the consumption boost may be modest given weak hiring, slower retail credit, debt repayments accounting for about 13% of recent UPI flows, and potential job losses from US tariffs in export-exposed sectors.