Finance Minister Arun Jaitley has said that rolling out of the GST as planned is high on the Modi government's list of priorities. He has also said that the Indian Public Sector banks (PSBs) are not yet ready for privatisation.
Addressing a press conference on Wednesday, the finance minister said with the upcoming state elections and a general election in three years time, the country's economic policy must deliver growth benefits to the citizens. "The advantages of reforms are the advantages of growth," Jaitley told the media at the Economist India Summit.
Talking about the GST bill, Jaitley said the bill (when implemented) will have a "transformational" impact by the creation of a common market place in the country for the first time. It would also act as a transfer mechanism, which would assist poorer states, Reuters reported.
The main goal of the central and state governments would be that the taxation system should become revenue neutral. The GST rate is speculated to be around 18 percent according to the central government's economic advisory; however Jaitley did not disclose what rate he would prefer.
PSB's not ready for privatisation
Arun Jaitley said it was crucial to restore India's banking sector, but he ruled out the possibility of selling stakes in public sector banks, which control 70 percent of the assets in India's financial system.
"I don't think that public or political opinion has converged to the point where we can think of privatisation in the banking sector," Jaitley said at the Economist India Summit. He said the government is planning to consolidate some of the public sector banks in order to strengthen them, but it will not reduce the state's shareholding below 52 percent.