GST Journalbranding

The excitement following the passage of the Goods and Services Tax (GST) Bill by the Indian Parliament on August 8, 2016, continues to resonate, as optimism both in the India Inc and in the general public grows. For one, this is an idea that has taken nearly sixteen years to come to fruition. While the implementation is currently slated for April 01, 2017, the transition from vagueness to clarity and resolving of political differences to support this development are major factors for its smooth and successful implementation.

The benefits and the expected impact may be couple of years away as implementation, technological glitches, and most importantly, the final GST rate to be finalized. However, even in its present form, the general consensus is that it will add 1-2 percent to the National GDP. It is being viewed as an image revival of the business environment in India from the global perspective as Ravi Kirpalani, CEO, Thyssenkrupp India expresses "The fact that there is a political consensus to pass the GST bill, will also improve global confidence in India as an ideal investment destination." Ashok P. Hinduja, Chairman, Hinduja Group of Companies, opines, "GST will be the biggest reform since 1991, which will make India an attractive destination for foreign investments."

Ease of doing business
Several sectors, including Manufacturing and Logistics in particular, are looking forward to lower production costs. With the application of uniform taxation, the Logistics and Warehousing Sector is keen to see their own efficiency improve with a boost in supply chain management and reduced transit-time. K. Ravichandran, Senior Vice President, Co-Head, Corporate Sector Ratings, ICRA Ltd. "Implementation of GST will be positive for some of the port logistics players, as it will lead to a realignment of their warehousing and supply chain requirements". Vipin Sondhi, MD and CEO, JCB India Limited summed up the passage of GST in Rajya Sabha as a landmark reform and a critical milestone towards Free Trade within India. He adds, "It will also give a massive push to Make in India especially MSMEs. The ease and cost of doing business will receive a fillip and the width of the tax base will be enhanced". Anand Sundaresan, Vice-Chairman & Managing Director, Schwing Stetter India Limited, says, "We are sure that this will improve our efficiency, reduce unnecessary administrative efforts, and could also increase profitability."

Lowering of interstate barriers is another expected benefit. Prakash Tulsiani, Executive Director & Chief Operating Officer, Allcargo Logistics comments "GST Bill is set to revolutionize logistics with unified and simplified structure versus multiple taxes at various levels. It will lower the inventories and working capital; reduce documentation, improve asset utilization, ensure higher turnaround time and efficiencies. We expect the industry to move away from pure vanilla warehousing needs to contract logistics."

Technologically speaking
Connecting over-expectations of clearing current ambiguities and facilitating smoother business processes, the ICT sector too has welcomed a 'transformational' legislation, as termed by Sunil Mittal, Chairman, Bharti Enterprises. Increase in GDP would also encourage job creation. "The development will address the ambiguities of the current indirect tax landscape, proving beneficial for the economy at large", hopes Bhaskar Pramanik, Chairman, Microsoft India. Besides a stronger economy, another positive likely with overall tax-reduction is cheaper consumer products, possibly triggering increased consumption. However, the final rate would determine the increased affordability of both consumer products and the services for the Digital India vision.

A concern for the ICT sector and elsewhere would be transference of responsibility of tax compliance and remittance to customers making them eligible for input credit, a quoted viewpoint of Bharat Goenka, Co-Founder & MD, Tally Solutions.

Service with a smile, still possible?
On one side, entertainment segment, especially Multiplex companies, which currently are being taxed under three separate heads, will benefit under the single umbrella taxation. "The Indian cinema industry has been taxed as a vice by a host of regulatory bodies including local, state and central authorities at extremely high rates, which have stunted the growth of the industry. We are hopeful that subsuming of all these taxes under GST will ease the pressure on the industry and allow it to grow to its full potential" is the positive outlook of Alok Tandon, CEO, INOX Leisure Ltd., said. On the other hand, the hotel and hospitality sector also has its reservations. The higher rate of GST proposed for aerated beverages, a major part of the bill, especially in fast serve restaurants and the fact that liquor is left under the States is likely to impact consumers feels Rahul Singh, Founder of Beer Café, and Honorary Secretary, National Restaurants Association of India.

The retail sector, which is currently in a sluggish mode, may hope to recover better margins as costs go down. "Implementation of GST is likely to reduce transaction cost of doing business. I am confident that once implemented, it will not only bring relief to the consumers, but also help the retail sector in a big way" hopes Krish Iyer, President & CEO, Walmart India. The ecommerce players are encouraged with the possibilities of strengthening seamless logistic networks with the free movement and supply of goods countrywide. The expectation is elimination of border barriers of especial concern to surface logistics services.

Construction Credit
Builders and developers are encouraged with the scope of free input credits on GST paid for services and goods purchased. This should reduce overall costs and allow the benefit sharing with customers, particularly commercial property, where inputs credits for construction services can be balanced against lease rental applicable GST. In the view of Mr. Navin Makhija, Managing Director, The Wadhwa Group "There will be a drop in raw material prices, which in turn may create enhanced demand as it is likely to be passed on to the consumers directly. This, in turn, may see some renewed interest of buyers towards buying properties". Concurring with this thought Parveen Jain, President, National Real Estate Development Council (NAREDCO) said "The enactment of this law will single-handedly solve many of the challenges faced by the real estate sector and help in pulling the sluggish sector out of its long slumber." "However, with the stamp-duty remaining with the states the benefit may reduce. "Exclusion of Stamp Duty charges from the GST is a setback, as home buyers will have to pay stamp duty too other than GST. Still, the benefit may go to home buyers if lower rate of GST is levied. Also it is very important that GST be implemented at the same rate in all the states to bring in uniformity", specifies Deepak Kapoor, President CREDAI Western U.P. The availability of credit more conveniently has Neha Hiranandani, Director, House of Hiranandani satisfied. She says "It would be a harbinger of change for the real estate sector which is currently plagued with a myriad of indirect tax issues both at the centre and state level. We hope that the bill brings in a more comprehensive and uniform tax structure that will ensure greater transparency in the sector."

Will the GST be a game changer?
From the view point of ease of doing business, especially for the manufacturing sector it will score positively. Clearing tax hurdles conveniently will benefit most sectors and encourage MNCs to conduct their business from India. Two primary aspects and possible sticking points are Firstly, the rate itself: Secondly, the implementation process. In an interview Ajit Gulabchand, Managing Director, Hindustan Construction Company expressed concern "Implementation of GST Bill will require a huge electronic platform on one hand and changing the practices of filing returns on the other. There is a very complex structure that would be required, which must work with the system integration, in a seamless manner for it to succeed," he said.

The roll out, implementation and teething period are all going to be dealt with before the full benefits, or otherwise are realized – that is the reality. Meanwhile, the motivated unification over a governance issue, clearly a game changer and a Swachh message going out.

"One Nation, One Tax"

GST is a destination based tax that is, the taxing right is with the state in which goods or services are ultimately consumed by the final consumers. It is the greatest Indirect Tax reform to present the country as a single market with a single tax system consonant with the provision of Article 301 of Part XIII of the Constitution of India "Subject to the other provisions of this Part, trade, commerce and intercourse throughout the territory of India shall be free".

Mooted in 2000, it has taken sixteen years for passing of the Bill. India shall adopt the Dual GST Model where both the State and the Centre levy the tax. This model is operational in countries like Canada and Brazil.
  1. Sale within the state will attract State GST (SGST) + Central GST (CGST)
  2. Sale outside the State will attract Integrated GST (IGST)
The effect will be on Indirect taxes like Value Added Tax (VAT), Sales Tax, Octroi, Luxury Tax by applying a single rate through a single tax. There is expectation that it would contribute up to 2 percent of the national GDP.

The ultimate aim is to improve compliance, sort out administrative tangles through uniformity in tax computing right from the input for raw materials.


Vipin Sondhi


"The passage of GST is a landmark reform. A critical milestone towards Free Trade within India. It will also give a massive push to Make in India especially MSMEs. The ease and cost of doing business will receive a fillip and the width of the tax base will be enhanced."
Vipin Sondhi, MD and CEO, JCB India Limited


Anand Sundaresan


"We are sure that this will improve our efficiency, reduce unnecessary administrative efforts, and could also increase profitability."
Anand Sundaresan, President, iCEMA.



Anshuman Magazine


"This is a major tax reform for our economy, which will transform India into a single market. The passage of this Bill is likely to positively impact the real estate sector, which has linkages with over 250 ancillary industries. Unified taxation will also infuse the much needed transparency into our taxation system."
Anshuman Magazine, Chairman, CBRE – India and South East Asia


Niranjan Hiranandani

This is a major reform undertaken by the government and it will be impacting the economy positively. If managed well, this alone has potential to add at least 1% to India's GDP growth. Capping the rate of tax is good. However, if the rate is increased later then it will prove to be tricky. Duality of tax authorities at state and central level is not a happy situation. If the states continue to levy stamp duty, other local taxes like labor cess and municipal taxes then it will add burden to home-buyers' cost.
Niranjan Hiranandani, Founder & MD, Hiranandani Group

Rajat Wahi
"The introduction of GST would positively impact the entire value chain of the consumer markets sector. A majority of consumer companies which are looking to rationalise their supply chain cost will benefit from a uniform inter-state GST which will ease the movement of goods across states, encourage business expansion and facilitate easy procurement. The manufacturers and retailers stand to benefit with GST implementation, in terms of reducing their supply chain logistics costs, as it would result in lessening the numbers of their warehouses."
Rajat Wahi, Partner and Head, Consumer Markets, KPMG

Anshul Jain


The clearance of the Goods and services tax (GST) Bill in the Rajya Sabha is a laudable step that would remove cascading taxes and make India's manufacturing sector more competitive.
Anshul Jain, Managing Director, India, Cushman & Wakefield

Colliers leads AI revolution in construction with remote monitoring tool CoGence
Real estate advisor, Colliers, has been carving a niche in the tech space with its AI-enabled platform CoGence. Designed to detect anomalies at construction sites and generate a high precision quality report, the tool is widely being applied at several of the

Read more ...

Cement volumes to expand by 9-10% in FY 2024 despite moderation in growth in H2: operating margins to improve by 260-310 bps to 16.0-16.5%: ICRA
ICRA expects cement volumes to rise by a healthy 9-10% in FY2024 supported by demand from infrastructure and urban housing sectors. In H1 FY2024, the volumes increased by 11-12% YoY. Nevertheless, the below normal monsoons could impact the

Read more ...

Polls Perk Up Realty & Infra Projects And Vice Versa
The ruling government is pushing speedier completion of real estate, housing, and infrastructure projects to win the confidence of voters in the upcoming elections in five states and the General elections in 2024. In turn, the polls are providing a renewed

Read more ...

Critical Considerations for Effectively Digitalizing the Engineering & Construction Industry
The Engineering & Construction (E&C) industry has typically lagged behind its peers in adopting cutting-edge technology. However, E&C companies have now begun to witness the humungous benefits that digitalization can reap. From increased productivity

Read more ...

IMEC:  A Big Booster for India’s Infra Construction Sector
The 8000 km multimodal transport corridor known as the India Middle-East Europe Corridor (IMEC) initiated at the recent G20 Conclave in New Delhi, is set to open up a multi-billion dollar opportunity for the growth of India’s infrastructure and construction companies

Read more ...

Considerations for Site Selection for Engineering Plant Projects
Site selection is the first and most important factor for location of any Engineering Plant Project as they involve huge construction costs. An unsuitable or wrong project site can result in great loss and may also lead to delays or failure of the project. Anil Kumar Nanda

Read more ...

Construction Mishaps - A Question Mark on Quality & Safety
Zainab Faridi compiles a series of recent construction mishaps that not only underscore the perils faced by Indian construction workers but also expose the urgent need for stricter quality check parameters, a skilled workforce, accountable project management

Read more ...

Decarbonizing Construction Industry for a Greener Future
A recent report by Deliotte - Shell indicates that the construction sector accounts for 37% of global CO2 emissions, of which 16% represent embodied carbon, that is carbon dioxide coming from material sourcing and manufacturing, logistics, and construction

Read more ...

Policy Prescription for Circular Economy to Boost Infra Construction
At a time when India is pushing policy reforms in a big way to provide a major boost to its economy, the generation of colossal 9.46 million tons of plastic waste every year and 150 metric tons of construction waste annually (about 40% of the global

Read more ...

7 Years of RERA Of Promising Gains, Challenges & Pitfalls
After seven years of its journey, the landmark reform of RERA (Real Estate Regulatory Act) has made some remarkable gains in terms of regulating the sector and protecting the interests of homebuyers. Especially considering that two crucial years were

Read more ...

National Ropeway Development Programme to Boost Real Estate
A massive USD 15 billion National Ropeway Development Programme of the Central Government, currently underway, will provide a major aerial connectivity boost to real estate, especially in Tier 2-3 cities that have high tourism potential. A Rs 1.25 lakh crore

Read more ...

J&K Realty and Infrastructure Development on Fast Track
As Jammu & Kashmir prepares to host G-20 Tourism Meet in Srinagar from 22-24 May 2023, the strides made by the Union Territory on urban development (in a run up to this conclave following the abrogation of Article 370 in August 2019), will provide

Read more ...

Ashoka Buildcon Achieves Largest Continuous Concrete Pour for Building Project
Ashoka Buildcon Limited has several prestigious projects under its belt and has to its credit notable record-breaking achievements - the latest being casting of a raft with 12400 cubic meters of concrete. With this feat, the company is eager to get

Read more ...

Investment Bonanza in UP to Fast-Track - Real Estate & Infrastructure Development
Riding high on landmark reforms and performance-driven governance, Uttar Pradesh has received a record investment proposals of over 33.50 trillion from Indian and foreign investors at the recently organised 3-day Global Investor Summit (GIS) in Lucknow

Read more ...

Mega Projects: Redefining Geographies
Mega infrastructure projects like flyovers, elevated roads, highways, metros, bridges, tunnels, expressways, etc, are redefining how we interact with our surroundings; in fact, Infrastructure is intrinsically linked to everyday life and is a defining

Read more ...

Major Connectivity Projects to Transform Urban Development Landscape of Delhi-NCR
With some state elections and general elections in sight, the Modi government has pulled out all stops to put its mega infrastructure projects on fast track for the socio-economic upliftment of people. A number of such key infrastructure projects

Read more ...

Women in Construction - Diverse Perspectives Will Drive Progress
India’s construction industry is advancing and embracing new technologies, and thereby throwing up exciting opportunities for women to grow professionally in traditionally male-dominated roles. With the advent of robotics, digital twins, and remote

Read more ...

Dola Roychowdhury - Founder Director, GCube Consulting Engineers LLP
The pay parity issue is very subtle and fragmented. It doesn't exist at entry levels any longer - but tends to widen as you go up the chain and hit that invisible ceiling. Compared to the global gender ratio of about 12%, India's female ratio is much lowe

Read more ...

Minimol Korulla - Maccaferri ISEAP
The global Infrastructure Construction industry currently has a female workforce ratio of 10% to 14%, while in India it is 8% to 12%. However, the representation of women in senior managerial roles is less than 2% - both globally and in India. The lack

Read more ...

Rubee Kongbrailatpam - Public Works Department, Manipur
The shift in perspective towards women's roles in the construction industry and the de-genderization of roles is a significant step towards creating a more inclusive and diverse workforce. Stereotypes and prejudices against women in construction

Read more ...