Steady interest rates, more tax collection

Initial reports on the GST rollout suggest that collection of the new tax exceeded government expectations by 1.5% in spite of the fact that 36% of projected assessees failed to file. It does appear, however, that some small and medium enterprises are suffering cash flow problems when their input GST rates differ from their output rates, given the delay in recovering input deductions. Meanwhile, Aadhaar-based direct benefit transfers have exceeded $13bn. First quarter GDP growth was a disappointing 5.9%. Manufacturing grew by a mere 1.2% and agriculture just 2.3%. Services grew by 8.7%, with a 6.4% contribution coming from financial services. September’s manufacturing PMI was 51.2, the same as August and the Services PMI recovered from two months of contraction to register 50.7 in September. August CPI inflation was 3.4%, up slightly on firmer food prices, but the WPI number was softer at 3.2%. The RBI monetary policy committee held interest rates steady at its latest review.