Nifty muted on a potential chaotic next-generation GST reform

 

·         Apart from the Trump tariff tantrum, the market is also concerned about a potential GST chaos due to complexities and no ITC for the 5-0% items

·         Overall weighted average GST rate would be ~12.50% vs earlier 14.5%

·         Theoretically, GST 2.0 reform may boost 0.5% GDP against a 0.5% drag from Trump tariffs

·         But the actual transmission of GST rate cuts to the real economy is vital without the profiteering and bypassing attitude of producers

·         India’s weak labor/job market and already high cost of living may not permit additional discretionary consumer spending meaningfully, even if there are some price cuts

On August 15, 2025, in his Independence Day speechto the nation, Indian Prime Minister (PM) Narendra Modi announced a transformative "next-generation GST reforms" plan, aimed at simplifying India's complex Goods and Services Tax (GST) structure and stimulating economic growth after Trump imposed 25% tariffs and threatened another 25% tariffs as ‘punishment’ for buying ‘dirty’ Russian oil and to fund the Ukraine war. These reforms, expected to be implemented before Diwali (October 2025), involve consolidating the current five-slab tax structure ()%, 5%, 12%, 18%, and 28+12=40%) into a streamlined four-slab system (0%, 5%, 18% and 40%), with a special 40% rate for luxury and sin goods & service like tobacco and online gaming.  The so-called sin/luxury GST was already 40% if we consider the additional 12% cess on top of 28%.

On September 3, 2025, as highly expected, the 56^th GST Council meeting was held in New Delhi under Union Finance Minister Nirmala Sitharaman. It approved the implementation of GST 2.0 from September 22, an auspicious ‘Navratri’ day, just ahead of the Diwali festival shopping season. India’s Goods and Services Tax (GST) reform, termed GST 2.0, effective from September 22, 2025, represents a significant overhaul of the indirect tax system introduced in 2017. The reform simplifies the tax structure, reduces rates on essentials, and aims to boost consumption, ease compliance, and foster economic growth.

The GST 2.0 reform simplifies the tax structure, reduces rates on essentials, and aims to boost consumption, ease compliance, and foster economic growth. Approximately 99% of items in the 12% slab will move to 5%, and 90% of items in the 28% slab will shift to 18%. Compensation cess, previously levied on luxury and demerit goods, will be eliminated by March 31, 2026, creating fiscal space for rate rationalization. The overall weighted average rates should be around 12.5% if we consider 60% of items are in 5%, 30% are in 18% and 10% are in 40% GST category. The current average weighted GST rate is around 14.5%.

Key GST Rate Changes- Simplified Tax Structure: Replaced the 4-tier GST structure with a 3-tier system.

·         Standard Rate: 18%

·         Merit Rate: 5%

·         Special De-merit Rate: 40% for select goods (e.g., pan masala, Gutkha, cigarettes, tobacco products

Exemptions for the Common Man: NIL GST on:

·         All individual life and health insurance policies (including family floater, senior citizen policies) and their reinsurance.

·         Ultra-High Temperature (UHT) milk, prepackaged Chena/paneer, all Indian breads (chapatti, roti, paratha, etc.).

·         33 lifesaving drugs for cancer, rare diseases, and chronic conditions; 3 additional drugs reduced from 5% to NIL

5% GST on:

·         Common items like hair oil, shampoo, toothpaste, toothbrushes, bicycles, tableware, and kitchenware

·         Food items like packaged nankeens, bhujia, pasta, instant noodles, chocolates, coffee, cornflakes, butter, and ghee.

·         All other drugs and medicines (reduced from 12%).

·         Medical apparatus/devices (e.g., glucometers, bandages, diagnostic kits) and renewable energy devices.

·         Tendu Leaves: Reduced to 5% to align with tobacco leaves and support minor forest produce.

·         Renewable Energy Devices: Reduced from 12% to 5%, with refund mechanisms for deepened inverted duty structures.

·         Electric vehicles (EVs) and renewable energy devices (e.g., solar cookers) retain or move to a 5% rate

·         Marble/Granite Blocks: Reduced from 12% to 5% as intermediate goods.

·         Spectacles/Goggles: Vision-correcting spectacles/goggles at 5% (down from 12%/18%); others at 18%.

·         Batteries: Uniformly taxed at 18% (lithium-ion from 18%, others from 28%).

Sector-Specific Reductions:

·         Agriculture: GST on tractors, agricultural machinery, and bio-pesticides reduced from 12% to 5%.

·         Labour-Intensive Goods: Handicrafts, marble/granite blocks, intermediate leather goods reduced from 12% to 5%

·         Textiles: Manmade fibre and yarn GST reduced from 18%/12% to 5%, correcting the inverted duty structure.

·         Fertilizers: Sulphuric acid, nitric acid, ammonia reduced from 18% to 5%.

·         Automotive: Small cars, motorcycles (≤350cc), buses, trucks, ambulances, auto parts, three-wheelers reduced from 28% to 18%.

·         Cement: Reduced from 28% to 18%.

·         Hotel Accommodation: Services ≤₹7,500/day reduced from 12% to 5%.

·         Beauty/Wellness Services: Gyms, salons, barbers, yoga centres reduced from 18% to 5%.

Increased Rates:

·         Pan Masala, gutkha, cigarettes, unmanufactured tobacco, and certain beverages (e.g., aerated waters, caffeinated drinks) increased to 40% (subject to compensation cess obligations); will not be implemented for some time (months) due to payment of earlier compensation cess along with interest payment obligations.

·         Coal: Increased to 18% from 5% plus ₹400/ton compensation cess, merging cess into GST with no additional burden.

Implementation Timeline

·         Effective Date: Most changes are effective from September 22, 2025

·         Exceptions: Pan Masala, gutkha, cigarettes, and tobacco products will retain existing rates until compensation cess obligations are cleared, with the transition date to be decided by the Union Finance Minister.

Trade Facilitation Measures

·         Goods and Services Tax Appellate Tribunal (GSTAT): Operational by the end of September 2025, with hearings starting by December 2025.

·         Deadline for filing backlog appeals: June 30, 2026.

·         Principal Bench to serve as the National Appellate Authority for Advance Ruling.

·         Process Reforms: Detailed in Annexure-V, to be notified later.

·         Provisional Refunds: 90% provisional refunds for inverted duty structure based on data analysis and risk evaluation.

Other Changes

·         Retail Sale Price (RSP) Taxation: Applied to pan masala, gutkha, cigarettes, and tobacco products

·         Exemptions: Ad hoc IGST and compensation cess exemption for armored sedan cars imported by the President’s Secretariat.

·         Restaurant Services: Clarified that standalone restaurants cannot declare themselves as ‘specified premises’ to pay 18% GST with ITC.

·         Valuation Rules: Amended for lottery tickets to align with tax rate changes.

Vehicles:

·         Small cars (petrol/LPG/CNG ≤1200cc, diesel ≤1500cc, length ≤4000mm): Reduced from 28% to 18%.

·         Mid-size/large cars (>1500cc or >4000mm), utility vehicles (SUVs, MUVs, MPVs, XUVs with ground clearance ≥170mm): 40% GST, no cess.

·         Three-wheelers, buses, trucks, ambulances: Reduced from 28% to 18%.

·         Motorcycles: ≤350cc at 18%; >350cc at 40%.

·         Bicycles and parts: Reduced from 12% to 5%.

Services

Insurance: All individual life insurance (term, ULIP, endowment) and health insurance (family floater, senior citizen) policies, including reinsurance, are exempt.

Transportation:

·         Passenger transport: 5% (no ITC) or 18% (with ITC) option.

·         Air passenger transport: 5% for economy class, 18% otherwise; no dual-rate option.

·         Goods transport by GTA/CTO: 5% (no ITC) or 18% (with ITC) option.

·         Multimodal goods transport: 5% (restricted ITC) if no air transport; 18% (full ITC) if air transport is involved.

Job Work:

·         Pharmaceutical products and hides/skins/leather (Chapter 41): Reduced from 12% to 5% with ITC.

·         Leather goods/footwear (Chapters 42/64) and alcoholic liquor: Remain at 18%.

·         Residuary job work: Increased from 12% to 18%.

Hotel Accommodation: ≤₹7,500/day at 5% (no ITC).

·         Beauty/Wellness Services: Health clubs, salons, barbers, fitness/yoga centres reduced from 18% to 5% (no ITC).

·         Actionable Claims: Lottery, betting, gambling, horse racing, casinos, and online gaming at 40%.

·         Sporting Events: IPL admission at 40%; other events exempt if ticket ≤₹500, else 18%.

·         Oil and Gas Works Contracts: Offshore exploration/production works contracts at 18%.

Rationale for Non-Exemptions

·         Agricultural Machinery, Medicines, GTA Services, and Job Work: Non-exemption maintains the ITC chain, preventing cost increases that would arise from reversing the ITC, which could raise prices for consumers/farmers.

·         Coal and Carbonated Beverages: Rate increases offset the removal of compensation cess to maintain tax incidence.

·         Textiles (Chemical Dyes, Plastics, etc.): Rates unchanged to avoid end-use-based exemptions, aligning with policy to simplify tax structure.

·         Technical Textiles: Treated as textiles, not plastics, with refund mechanisms for inverted duty structures.

·         Toilet Soap Bars vs. Liquid Soap: Bars reduced to 5% to benefit lower-income groups; liquid soap remains at higher rates.

·         Face Powder/Shampoos: Reduced to 5% as daily-use items, despite benefiting luxury brands, to simplify the tax structure.

·         Mouthwash: Not reduced (unlike toothpaste, brushes, and floss) as it’s not considered basic dental hygiene.

·         Raw Cotton: Taxed on reverse charge to maintain the ITC chain for the textile industry, benefiting consumers.

Additional Notes

·         Special Rate (40%): Applied to sin goods (e.g., tobacco, betting) and select luxury goods, merging compensation cess into GST to maintain tax incidence.

·         Wood Pulp: Differential rates reflect separate paper and textile supply chains.

·         Process Reforms: Expedited refunds for inverted duty structures to support manufacturers.

Ease of Compliance:

·         Introduction of pre-filled GST returns, automated refunds, and tech-based registration to simplify compliance, particularly for MSMEs

·         Resolving inverted duty structures to reduce working capital blockages and improve manufacturing competitiveness.

·         Support for MSMEs and Formalization: Simplified compliance and lower tax rates reduce costs for MSMEs, encouraging formalization of the unorganized sector and expanding the tax base.

·         Faster refunds and pre-filled returns ease working capital constraints, enabling MSMEs to redirect resources to growth.

Potential Theoretical Impact on the Economy

·         Boost to Consumption: Lower taxes on essentials (e.g., FMCG, dairy, personal care) and aspirational goods (e.g., small cars, appliances) are expected to increase disposable income, driving consumption, which accounts for ~60% of India’s GDP.

·         Savings estimates include ₹9,000 annually on a ₹50,000 insurance premium, ₹2–3 lakh on a ₹50 lakh property (due to cement tax cuts), and ₹1,000–2,000 monthly on groceries.

·         Analysts predict a “multiplier effect” on the economy, reigniting the “animal spirits” of spending, especially in rural and middle-class households

Resilience against Global Trade Disruptions:

·         GST 2.0 aims to cushion the impact of 50% US tariffs on Indian exports by boosting domestic demand and reducing costs for exporters

·         Sectors like textiles, automobiles, and agriculture benefit from lower input costs and tax inversions, enhancing competitiveness.

·         The US’s 50% tariffs on Indian exports posed a risk to markets, but GST 2.0’s consumption boost has limited corrections. The Nifty 50 fell only 1% in August 2025, with consumption stocks outperforming.

·         Analyst Chris Wood noted that GST rationalization prevented a deeper market correction by sustaining demand momentum.

Inflation Control: RBI may cut 50 bps in H2FY26

·         Lower GST rates on essentials are expected to reduce consumer price inflation (already at an eight-year low of 1.6% in July 2025). This could provide the Reserve Bank of India (RBI) with flexibility for monetary easing

·         However, higher taxes on sin goods (e.g., aerated beverages, tobacco) may marginally increase prices in those categories.

Fiscal Impact: Estimated revenue loss of ₹93,000 crore (~0.26% of GDP), reduced to ₹48,000 crore (~0.13% of GDP) after higher revenues from the 40% slab. States will bear ~70% of the loss, but it’s still not clear whether ~₹0.50T revenue loss for the full or half year. Increased consumption and compliance are expected to offset revenue shortfalls in the long term, maintaining the fiscal deficit at ~4.4% of GDP for FY26.

Sectoral Growth:

·         Healthcare: Tax exemptions on medicines and insurance improve affordability, potentially increasing insurance penetration (currently 3.8% of GDP)

·         Real Estate: Lower cement taxes (28% to 18%) reduce construction costs, boosting affordable housing and infrastructure.    

·         Automobiles: Reduced GST on small cars (28% to 18%) and EVs (retained at 5%) could revive demand, especially for companies like Maruti Suzuki.    

Long-Term Economic Goals:

·         GST 2.0 supports India’s Atmanirbhar Bharat (self-reliant India) initiative by enhancing manufacturing competitiveness and reducing logistics costs.  

·         Simplified taxation and reduced disputes could improve India’s ease of doing business ranking, attracting investment.

Positive/neutral Market Sentiment:

Indian equity indices (Nifty, Sensex) rose over 1% post the GST Council’s approval, reflecting optimism about consumption-driven growth, but sizzled out amid concern over input tax credit and reality of implementations; many cement companies already hiked price equivalent to potential GST rate cuts later; i.e. most of the producers may be looking for profiteering, bypassing the system/law. - Sectors like auto, FMCG, consumer durables, and real estate saw gains of up to 6.5% in August 2025, driven by anticipated demand revival. Stocks like Maruti Suzuki, Mahindra & Mahindra, Hindustan Unilever, and ITC. Insurance stocks (e.g., ICICI Prudential, SBI Life, and LIC) gained 2–5% due to GST exemptions on health and life insurance, but most of them stumbled on the concern of non-availability of ITC under the 0% or even 5% GST slab to offset their GST payment for various other input costs.

Sector-Specific Impacts:

·         Consumer Durables & FMCG: Tax cuts on appliances, soaps, and dairy products are expected to boost demand, benefiting companies like Samsung, LG, and Hindustan Unilever (HUL)

·         Automobiles: Lower taxes on small cars and EVs favor Maruti Suzuki and Tata Motors, potentially reversing the decline in small car sales (down from 50% to 33% of the market pre-COVID).

·         Real Estate & Cement: Reduced cement taxes support developers and cement companies (e.g., UltraTech, Ambuja), enhancing housing affordability.

·         Healthcare & Insurance: Tax exemptions drive growth for insurance firms and pharma companies producing lifesaving drugs.

·         Sin Goods: Higher taxes on tobacco and aerated beverages may pressure companies like ITC (tobacco) and Coca-Cola/Pepsi, though their diversified portfolios may mitigate impacts.

Earnings and GDP Growth:

·         Analysts predict double-digit corporate earnings growth due to increased consumption and simplified compliance, improving valuations in consumption-driven sectors.

·         Q1FY26 GDP growth of 7.8% and GST reforms could attract foreign institutional investors (FIIs), supporting market stability.

Risks and Challenges:

·         SMEs in export-oriented sectors (e.g., textiles, diamonds) face tariff-related stress, which could impact microfinance and consumer finance stocks

·         Higher taxes on online gaming may dampen growth in that sector, affecting related tech firms

·         Short-term revenue losses could create volatility if consumption growth underperforms expectations.

·         While lower taxes are expected to boost consumption, the initial revenue loss (₹48,000–93,000 crore) could strain state finances, potentially leading to pushback from states in future GST Council meetings.

·         A Think Change Forum report warns that the 40% slab for sin goods could expand over time, undermining simplification efforts. It advocates for a single-rate GST in the future, capped at 18%.

·         Past GST rollouts faced technological hurdles (e.g., GSTN portal glitches), and similar issues could arise with pre-filled returns and automated refunds, especially for SMEs.

·         Classification disputes (e.g., salted vs. caramel popcorn) may persist unless fully resolved, impacting compliance costs.

·         The timing of GST 2.0 aligns with global trade tensions, particularly US tariffs, making domestic demand critical. The reform’s success depends on effective rate transmission to consumers.

·         GST 2.0 is a step toward a simpler, more transparent tax system, but analysts suggest a single-rate GST (e.g., 18%) could further reduce distortions and litigation, aligning with global best practices.

GST 2.0 is a transformative reform aimed at simplifying India’s sales/consumption tax system, reducing the tax burden on essentials, and boosting consumption. It is expected to drive economic growth (potentially 6.5–7% GDP over two years), support MSMEs, and enhance affordability in sectors like healthcare, automobiles, and real estate. The stock market has responded positively, with consumption-driven sectors (FMCG, auto, insurance) gaining, though tariff-related risks and short-term revenue losses remain concerns. By addressing structural issues, easing compliance, and aligning with India’s self-reliance goals, GST 2.0 could strengthen the economy’s resilience and global competitiveness, provided implementation is smooth and consumption growth meets expectations.

Sectors Facing Higher Cost Pressure Due to Non-Availability of Input Tax Credit (ITC) in Zero or 5% GST Slab under GST 2.0

Under GST 2.0, effective from September 22, 2025, several goods and services have been moved to the zero-rated or 5% GST slab, which typically restricts or eliminates the availability of Input Tax Credit (ITC). This means businesses in these sectors cannot offset taxes paid on inputs against their output tax liability, leading to higher cost pressures.

Key Context on ITC and GST 2.0

·         Zero-Rated Supplies: Goods and services with a 0% GST rate (e.g., education services, certain lifesaving medicines) do not allow ITC, as no output tax is charged.

·         5% GST Slab: For goods and services taxed at 5%, ITC is generally restricted under Section 17(5) of the CGST Act unless specifically allowed, as the low tax rate assumes minimal input tax recovery to keep prices affordable.

·         Impact: Businesses in these sectors face higher input costs, as taxes paid on raw materials, services, or capital goods (often taxed at 18% or higher) cannot be claimed as credits, increasing the cost of production or operations.

Sectors Likely to Face Higher Cost Pressure

Healthcare Sector: Affected Segments

·         Manufacturers and suppliers of lifesaving medicines (33 drugs now exempt from GST).

·         Providers of health insurance services (GST-exempt for individual life and health insurance policies).

·         Medical equipment like oxygen concentrators and medical-grade oxygen (GST reduced to 5%).

·         Inputs such as active pharmaceutical ingredients (APIs), packaging materials, or logistics services are often taxed at 18%. Without ITC, manufacturers absorb these costs, squeezing margins.

·         Health insurance providers face non-recoverable taxes on operational inputs (e.g., IT services, office supplies), increasing premium costs, or reducing profitability.

·         A pharmaceutical company producing exempt lifesaving drugs cannot claim ITC on taxes paid for APIs (18%) or manufacturing equipment, raising production costs.

·         Some firms may pass costs to consumers via higher prices for non-exempt products or diversify into taxable segments.

Agriculture and Allied Sectors:

·         Manufacturers of tractors, farm machinery, fertilizers, and drip irrigation systems (GST reduced from 12–18% to 5%).

·         Suppliers of certain agricultural inputs (e.g., seeds, organic manure) that may fall under the 0% or 5% slab.

·         Inputs like steel, plastic components, or fuel for machinery are taxed at 18%, but ITC is restricted for 5%-rated outputs. This increases manufacturing costs for tractor and irrigation equipment producers.

·         Fertilizer manufacturers face similar issues with chemical inputs taxed at higher rates.

·         A tractor manufacturer like Mahindra & Mahindra cannot claim ITC on steel or components (18%), leading to higher production costs despite lower GST on the final product.

·         Mitigation: Companies may absorb costs to remain competitive or lobby for ITC eligibility on critical inputs.

Education Sector:

·         Providers of education services (schools, colleges, coaching centers) and books (now fully GST-exempt)

·         Educational institutions incur taxes on inputs like IT infrastructure, stationery, and facility maintenance (taxed at 18%), but cannot claim ITC due to the exempt status of their services.

·         Publishers of educational books face non-recoverable taxes on paper, printing, and logistics, increasing book production costs.

·         A coaching institute like Byju’s or a school cannot claim ITC on computers or software subscriptions, raising operational expenses.

·         Institutions may increase fees or rely on government subsidies to offset costs.

Food and Beverage Sector (Essential Goods):

·         Producers of dairy products (e.g., milk, curd), cereals (e.g., corn flakes), and essential food items (e.g., Atta, rice) moved to 0% or 5% GST.

·         Inputs like packaging materials, transportation, and processing equipment are taxed at 18%, but ITC is unavailable for zero-rated or 5%-rated outputs, increasing costs.

·         Small-scale food processors and dairy cooperatives face higher compliance costs without ITC relief.

·         A dairy company like Amul cannot claim ITC on plastic packaging or cold storage equipment, impacting margins on low-taxed products.

·         Large players may absorb costs due to economies of scale, but smaller firms may struggle or pass costs to consumers.

Renewable Energy and Sustainability:

·         Manufacturers of electric vehicles (EVs), solar cookers, and renewable energy devices (retained at or moved to 5% GST).

·         Inputs like batteries, semiconductors, and steel (taxed at 18%) result in non-recoverable taxes, increasing production costs for EV and solar equipment manufacturers.

·         Service providers in renewable energy (e.g., installation services) face similar ITC restrictions if outputs are low-taxed.

·         An EV manufacturer like Tata Motors cannot claim ITC on battery components, raising vehicle costs despite the 5% GST rate.

·         Government incentives for green energy or partial ITC relaxations could alleviate pressures.

Textile and Apparel (Low-Cost Segment):

·         Manufacturers of low-cost clothing and footwear (below a certain price threshold, moved to 5% GST).

·         Inputs like synthetic fibers, dyes, and stitching machinery are taxed at 18%, but ITC is restricted for 5%-rated outputs, increasing costs for budget apparel manufacturers.

·         A small-scale garment producer cannot claim ITC on fabric or dyeing services, squeezing margins in a competitive market.

·         Firms may focus on higher-priced apparel (18% slabs) to avail ITC or seek export markets (where ITC is allowed for zero-rated exports).

Broader Implications

·         Margin Compression: Sectors with restricted ITC face reduced profitability unless they pass costs to consumers, which may be challenging for essentials due to price sensitivity

·         Supply Chain Impact: Suppliers of inputs (e.g., packaging, logistics) taxed at 18% may face demand pressure from downstream businesses unable to claim ITC, affecting their pricing strategies.

·         Compliance Burden: Small and medium enterprises (SMEs) in these sectors, with limited resources, may face higher compliance costs to manage ITC restrictions, potentially discouraging formalization.

·         Rural and MSME Impact: Sectors like agriculture, dairy, and low-cost textiles, which employ large rural and MSME workforces, are particularly vulnerable to cost pressures, potentially affecting rural economies.

Potential Mitigation Strategies

Government Interventions:

·         The GST Council could allow partial ITC for specific inputs critical to zero-rate or 5% slab sectors, as proposed in some pre-GST 2.0 discussions.

·         Subsidies or exemptions on key inputs (e.g., APIs for medicines, steel for tractors) could reduce cost pressures.

·         Firms can diversify into taxable segments (18% slabs) to utilize ITC, e.g., a dairy company producing premium ice cream (18%) alongside milk (0%).

·         Larger firms may absorb costs through operational efficiencies or negotiate bulk discounts with suppliers.

·         Where feasible, businesses may pass costs to consumers, though this is limited for essentials due to demand elasticity.

·         Sectors like textiles and EVs can leverage zero-rated exports to claim ITC on inputs, mitigating domestic cost pressures.

Conclusions: GST 2.0 may not help in incrementally higher EPS for corporate India

Overall, GST 2.0 reform may turn out to be GST Chaos 2.0, like GST 1.0 during 2017-18:

·         Overall GST structure is still very complex, with luxury rates (popcorn tax) for the same goods & services based on price & quality

·         The issue of non-availability of ITC for most of the goods & services under 5% and 0% GST rate may increase the cost of producers as they can’t reimburse potential higher GST paid on input raw materials and services; thus they have to increase prices or absorb higher costs, something which may not be good for Dalal Street (lower profit) and also Main Street (higher costs).

·         An overall chaotic system may increase the cost of compliance burden of MSMEs, leading to the financial viability of their business and the eventual closing down.

·         Although there would be some consumption boost for automobiles, consumer durables, etc, overall it may be quite limited due to weak labor/job market, already higher cost of living, and cautious Banks/NBFCs to extend consumer loans due to rising NPA/delinquency issues.

·         Also, automobile sales in big tire one/two/three cities are facing various other issues, including E20 fuel blending, higher cost to maintain personal cars, etc.

·         The issue of compensation for various goods & services already in the market, the rate of which would be reduced from existing levels

·         The government may do the GST reform better by keeping only two rates (10% and 15%), averaging around 12.50% with full ITC rather than pretending it as a vote bank tool (consumers ahead of various state elections), which actually will help note bank (producers) in hiking prices before the 2029 general election.

·         Overall probabilities of full-scale transmission of any real GST rate cuts to the real economy would be negligible.

Technical outlook: Nifty Future and Bank Nifty Future

Looking ahead, whatever may be the narrative, technically Nifty Future (CMP: 24842) now has to sustain over 25100 for a recovery to 25250/25400-25500/2525800 and a further rally to 26000 and 26100/26300-26400/26500; otherwise, sustaining below 25050/25000-24900/24800, Nifty Future may again fall to 24600/24500-24400/24300 and 24000 and 23600/23350*-23900/23750 and 23400*/23100-22600/22200 and further 22000-21700* the coming days.