new delhi the world bank has maintained its growth forecast for the indian economy for the current fiscal year and expects it to expand by 75 in 201516 it has backed implementation of three key reforms including the goods services tax gst to sustain the momentum in its development update a twice a year report on the indian economy and its prospects the bank expects growth to accelerate to 78 in 20162017 and 79 in 20172018 but it said acceleration in growth is conditional on the growth rate of investment picking up to 88 during 20162018 the reserve bank of india expects the economy to grow by 74 in the current fiscal year while the government pegs it at over 75 the international monetary fund expects growth to be 75 the update noted that while public investments have helped kickstart the investment cycle increased participation of the private sector will be required going forward in the near term india is relatively well positioned to weather the global volatility its low trade exposure to china and considerable foreign exchange reserves provide ample buffer in the medium term however the indian economy is not immune to a slowdown in global demand and heightened volatility there are good reasons for confidence in indias nearterm prospects to lay the foundation for sustainable growth and accelerate job creation implementing the governments reform programme is key said onno ruhl world bank country director in india while progress is visible in several areas including improvements in the ease of doing business some key reforms most notably the implementation of the goods and services tax gst can be a potential game changer for india he said for the economy to achieve its potential the update calls for three key domestic reforms these include boosting the balance sheets of the banking sector by addressing the underlying challenges in the infrastructure sector especially power and roads improving the ease of doing business and enacting the gst and enhancing the capacity of states and local governments to deliver public service as more resources are devolved from the centre it suggests eventually bringing in alcohol electricity and real estate under the purview of the proposed gst which are currently excluded from it according to the update even though alcohol and petroleum account for over 40 to 45 of vatsales tax revenues for the states there are few technical reasons for excluding them from the gst exclusion of electricity would mean that manufacturing firms are unable to claim credits for the duty they pay and are therefore taxed twice in the case of alcohol including it in gst would help address concerns about state excise rate arbitrage bringing real estate under the gst umbrella may complement the governments efforts to curb undeclared black money in the sector according to the report