India’s festive season delivered a blockbuster ₹6 lakh crore in consumer spending, an 8.5% jump from last year, as sweeping GST reductions timed for Navratri unlocked pent-up demand across automobiles, electronics and apparel.
Finance Minister Nirmala Sitharaman’s September 3 announcement slashed rates on nearly 400 everyday items – from televisions and refrigerators to packaged sweets and two-wheelers – collapsing the old four-tier structure into a cleaner 5% and 18% slab, with sin goods bumped to 40%. The cuts kicked in September 22, the first day of Navratri, handing households savings of up to ₹2.5 lakh crore and turning the nine-day festival-to-Diwali window into a retail bonanza.
Who benefited? Urban shoppers drove 10% growth, snapping up big-ticket items as car loans rose 12% and two-wheeler sales leapt 15-18%. Rural India chipped in with 5% gains, buoyed by steady farm incomes and cheaper appliances.
Maruti Suzuki and Tata Motors reported their strongest October in years; LG and Samsung showrooms ran out of 55-inch TVs.
Why now? Private consumption, 58% of GDP, had stalled under high interest rates, sticky inflation and U.S. tariffs hammering textile exports. Officials say the stimulus will add 0.3-0.4 percentage points to Q3 GDP while keeping GST collections steady.
How it played out: Prices dipped 2-5% overnight. A ₹45,000 refrigerator fell ₹2,200; a ₹1.2 lakh hatchback shed ₹8,000. E-commerce platforms and kirana stores alike logged double-digit volume spikes. The BSE Sensex vaulted from 81,000 to breach 85,000 in the festive fortnight, rewarding FMCG and auto stocks.
“The GST gift arrived exactly when wallets were opening,” said B.C. Bhartia, president of the Confederation of All India Traders. “Rural markets that skipped last year came roaring back.”
Yet economists caution the party may fade. Demand-pull inflation looms if wages don’t catch up. Exports still face 25% U.S. duties on garments. And the revenue forgone – roughly ₹35,000 crore annually – must be offset by broader compliance.
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