business

Updated: Mar 17, 2017 18:14 IST

Terming India’s Prime Minister Narendra Modi is the most “successful” and “impressive” political leader in the world, leading foreign brokerage CLSA said the demonestisation and Goods and Services Tax will help spur economic growth.

“Modi is now being hailed, with good reason, as the most powerful political leader in India since Indira Gandhi,” said Christopher Wood, the chief equity strategist for Asia-Pacific Markets at CLSA.

“He is certainly the most successful, as well as the most impressive, political leader in the world today,” Wood wrote in a note.

On Thursday, Indian share benchmarks have touched record high recently tracking global cues and of course Modi’s reform agenda. The Centre and states recently finalised all the five draft bills for rolling out GST.

Modi spearheaded the successful election campaign for his Bharatiya Janata Party that led to a landslide victory in Uttar Pradesh has been applauded by global investors as an endorsement of his economic reform agenda.

Modi’s win strengthened his claim to a second term in 2019, and investors are betting it will embolden the ruling Bharatiya Janata Party (BJP) to embark on more reforms including launching the countrywide goods and services tax passage of labour and land acquisition bills.

CLSA termed the demonestisation drive three months before the UP polls as a “gamble” that has paid off in the “most spectacular fashion”.

The demonetisation coupled with the GST will help accelerate economic growth, CLSA said.

“There should only be an upside in terms of the trend in government revenues as a percentage of GDP, which are currently at 21%,” CLSA added.

India’s stats office CSO has projected GDP growth at 7.1% for 2016-17, slower than 7.9% in the previous year, as demonetisation crimped consumption and staggered investment. Most independent analysts forecast growth to pick up in 2017-18. The government Economic Survey forecast GDP to grow 6.75-7.5% in 2017-18.