EXPERTS ADVISORY

After months of delay, India’s parliament has passed the much awaited Goods and Services Tax bill, India’s biggest tax reform since independence. University of Michigan experts can comment on the impact of the GST bill:

Puneet Manchanda, professor of marketing at the Ross School of Business, is an expert on business in emerging markets, business in India, and strategy and marketing issues.

“Passing the Goods & Services Tax is one of the biggest tax reforms ever in India,” he said. “It has the potential, after an initial period of procedural development, to accelerate the economy’s growth significantly. This should be seen as a win for economics over politics, a very refreshing change from the norm. While an important factor in getting this passed was a very weak opposition party (Congress), the Modi government’s persistence deserves plaudits for making this happen. This could very well be a defining economic moment for this government.

“There will be some pain in that this could increase inflationary pressures and will penalize rich states that prefer to have more oversight over their own tax revenues. The benefits will also be apparent only after a couple of years at the minimum.”

Contact: 734-936-2445, pmanchan@umich.edu

Vikramaditya Khanna, professor at the U-M Law School, is an expert on global corporate and financial law and policy.

“The enactment of the GST in India heralds one of the most significant post-Independence reforms making doing business in India easier and facilitating the easier flow of goods and services across states,” he said. “Estimates are that it is likely to increase GDP by up to 2 percent in India, which is already the fastest growing of the world’s large economies.”

Contact: 734-369-2026, vskhanna@umich.edu

M.S. Krishnan, associate dean of global initiatives at the Ross School of Business, studies business in India, computer information systems and has led several projects in India.

Contact: 734-763-6749, mskrish@umich.edu