The manufacturing sector contributes 17% to the country’s overall GDP of which 45% of the manufacturing sector’s output is contributed by the SME sector alone. The SME sector forms an integral part of the Indian manufacturing sector and enjoyed a sheltered existence with a high tariff on imports, fiscal incentives and a monopoly on the manufacture of certain goods. However, the reform era beginning 1991 opened India to trade agreements with other countries that proved advantageous to organizations that held a monopoly in their respective trades. To help with this and augment the global competitiveness of the Indian micro, small and medium enterprises (MSME), the Government of India in partnership with the MSME ministry launched a set of schemes under the National Manufacturing Competitiveness Programme (NMCP). These schemes which began to be implemented in 2006 aim to give these enterprises a competitive edge to survive in a liberalised economy.
India has one of the most rapidly expanding service sectors in the world with the least portion of services employment, contributing to around 66% of the Indian GDP. According to data analysis, India has had a 9.2% growth in the service sector in the year 2015-16 but in the year 2014, it had the smallest share of services employment in the world. Following this, the Government made several amendments to develop India’s commercial services exports share in the global services market and this has facilitated multi-fold growth in the GDP. If you look at the manufacturing industry too, about 34% of the manufacturing jobs are service oriented functions. The dollar’s value of final demand for manufacturers comes up to $1.48 in other services and production, thereby boosting the importance of services in the economy and in employment generation.
India’s distinctive competencies and competitive advantage formed by the knowledge-based services makes it a truly unique emerging market. Backed by several government initiatives, the services sector in India has the potential to unlock a multi-trillion dollar opportunity which can create a symbiotic growth for all nations. Here’s a look at how the Indian service industry performed in Q1, 2017.
Amidst the entire economic crisis across the globe, India is demonstrating hope with determined growth targets, supported by a slew of important projects like “Make in India”, “Digital India”, etc. The biggest tax reform since Independence, the Goods and Service Tax (GST), is all set to transform the Indian tax system.
The Goods and Services Tax (GST) is expected to act as the much-needed catalyst for economic growth in India and is expected to alter the indirect taxes levied on goods and services within the economy and also eliminate the cascading effect of the tax system. GST has created high anticipation not only in India but also among all the neighboring and developed economies of the world. India will be playing a vital role in the global economy in the coming years because of GST implementation. Among all the rumours about the negative impact of this bill on the SME sector, would the pros outweigh all the cons?
We wanted to give our readers something informative yet different and thought what better way for that than with a quick recap of the major events from 2016 to early 2017 from across the globe, India and us at KredX. 2016 has been quite a rollercoaster ride for the world and us in India. From terrifying events to groundbreaking changes and new opportunities, it certainly was a mixed bag of emotions. Let’s take a look back at some of the most impactful stories from the last year and early 2017.
As the country inches closer to the final rollout of GST, economists, financial experts and entire industries are preparing themselves for the potential impact GST would have on the various sectors. GST, touted as one of the most revolutionary bills to ever be implemented, is expected to benefit the common man and make a positive impact on most industries barring a few. Let’s take a quick look at the tax rates and tax slabs recently announced by the GST Council.