Indian Economy Relying On GST 2.0 Impetus, Says Manish Chokhani

Manish Chokhani, Director at ENAM Holdings Ltd., believes India may lose its spot as the third biggest economy if recent Goods and Services Tax (GST) reforms fail to revive consumption, calling it the country's most critical lever to revive growth.

Speaking to NDTV Profit, Chokhani explained that exports and investments are no longer India's growth levers, leaving the domestic consumption cycle as the only real driver of growth in the country.

“Export looks difficult given the current geopolitical scenario and we don’t have the scale because we haven’t given the purchasing power to our people by reverse currency and interest rates,” he said.

Chokhani added that corporate tax cuts have failed to boost the investment cycle and this has added to the woes.

"You’re not getting the investment cycle kickstart despite the government dropping the corporate tax rate. They dropped corporate tax rates long ago, but until you don’t see the local demand in front of you, you’re not really going to put up capacity based on exports,” Chokhani explained.

The lack of investment cycle can be tied to low demand and negligible export opportunities, he argued.

Formerly the CEO of ENAM Securities, Manish Chokhani is one of India's most respected financial advisors. According to Chokhani, India's export window has narrowed while the investment cycle has already been stretched. The lack of private capex has only made things worse.

“Export is gone, and your investment cycle is not kickstarting. In the first three/four years, the government took the onus by taking on bulk of the capex. But they can’t compound beyond a certain point. So you need the private sector capex to pick up. But the private sector in India is having its own issues," he added.

A government survey conducted in April 2025 suggested that intended private expenditure of private corporate secret is expected to decline by about 25% to Rs 4.88 lakh crore in 2025/26 versus Rs 6.56 lakh in FY25.

That leaves the consumer demand as the only growth lever, and while the GST cuts will undoubtedly help, Chokhani warns that the road ahead could be difficult if the tax cuts fail to have any meaningful impact.

“The only logical thing eventually was that you need domestic consumption to be kick-started, because if you see people go and buy more cars and more white goods, you’ll put up capacity. So the GST reform is a very important bet for India, and it has to stimulate demand and create jobs,” he said.

Chokhani concluded that technology, branding and jobs will be critical for India going forward, and if the country fails to capitalise on these levers, there is a possibility of India losing its place as the third biggest economy.

“Jobs, tech and branding are the three things to watch out for in the next couple of years. If we crack it, we are going to move up; otherwise, currency is gone, and instead of number three [economy], we may remain number four or five,” he concluded.