Vishakapatnam: Union finance minister Arun Jaitley said on Friday that Andhra Pradesh is expected to grow 4-5% more than the national average in the coming years.

The environment for policy formulation and reform is far more positive in India than anywhere else in the world, he said.

Speaking at the inaugural session of the Andhra Pradesh-Confederation of Indian Industries (CII) Partnership summit in Visakhapatnam, Jaitley said that there three important directions to this change in the country.

JAM, an acronym used to describe the Jan Dhan accounts, aadhaar, mobile phones, Goods and Services Tax (GST) and finally demonetisation are powering the change.

He said that India, which was a largely non-compliant society in direct and indirect taxes, will now become part of the system.

Jaitley on Friday put up a spirited defence of demonetisation, saying the drive “shook" the financial system for a short while, but will integrate the shadow economy with the formal economy in the long run and ensure better tax compliance.

He said most contentious issues regarding the GST have been sorted out between the Centre and states and the new indirect tax regime is in its final stages of implementation.

“Demonetisation shook the system for some time but is now gradually increasing the process of integrating India’s shadow economy with the formal economy," he said.

Jaitley, who will present the Union budget on 1 February, said that the currency is back in the banking system and the GST will help increase revenues for the state and Central coffers as it will widen scope of formal economy.

Union commerce and industries minister Nirmala Sitharaman, Urban development ninister Venkaiah Naidu along with chief executives representing about 100 global companies are expected to attend the summit.

Andhra Pradesh chief minister Chandrababu Naidu said that the state grew 12.23% in the first half of the current financial year while the national average was 7.2%.

“The state will aim at moving to 13% and higher growth rates. Naidu said despite the 28% deficient rainfalls, agriculture in the state had grown 24.5% due to water management including linking of two important rivers,’ Naidu said.

Jaitley assured more support for the state, which he said was disadvantaged in the bifurcation process in 2014.

Telangana was carved out of a unified Andhra Pradesh in 2014.

It is expected that over 400 memorandums of understanding (MoU) will be signed during the two-day event amounting to upwards of Rs7 trillion being signed across sectors such as aerospace and defence, oil and natural gas, automobiles, life sciences, electronics, energy and minerals among others.

PTI contributed to this copy

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