“The economy is going through a phase of readjustment to a system of formalisation that entails greater tax compliance and transparency in financial transactions," said finance secretary Ashok Lavasa.
The Government of India says decline in growth is a short term phenomena, which will not last for long.
It expects the economy to pick pace in the second quarter of 2017-18, as the issues around GST get resolved and the effect of demonetisation fades.
“The economy is going through a phase of readjustment to a system of formalisation that entails greater tax compliance and transparency in financial transactions," finance secretary Ashok Lavasa was quoted as saying.
"Things are beginning to settle down and we are on the recovery path," he added.
A few experts had speculated about destocking of goods prior to GST roll-out to have an impact on the economy, but restocking has also been taking place with the festive season well underway. That should be reflected in the coming quarters, he said.
Tata Motors registered a growth of 29 per cent in commercial vehicles category in September as against a year ago. Car sales also have also gone up.
According to rating agency Crisil, the credit ratio — upgrades to downgrades — improved to 1.88 in the first half of the current fiscal compared with 1.22 for all of fiscal 2017.