Loss of 0.01 jobs.

"India is currently the world's fastest growing major economy," but "During the 1990s, every percentage point of GDP growth yielded roughly 0.41% growth in formal employment. By early 2026, that employment elasticity had plummeted to 0.01." It means GDP growth is not creating jobs for labor. "This is the '0.01 trap' - a state where the economy can double in size while people's economic well-being does not improve," wrote Ejaz Ghani. There is another problem with the growth. "While India's GDP is expected to grow at a healthy 7.4% in 2025-26 in real terms, nominal growth is likely to be just 8%." HT found that "the post-pandemic period has seen the lowest nominal GDP growth since the 1970s despite real growth not doing so badly." The reason is low inflation due to low global commodity prices and deflationary pressures because of China's massive excess capacity in manufacturing, wrote  Roshan Kishore. High inflation helps the government by increasing tax collections and decreasing the real value of its debt. Economics Help. Despite lower inflation, "India's Goods and Services Tax Collections (GST) rose to a record high of Rs 2.43 trillion in April 2026." "The government data show gross GST collections rising 8.7%." "Strong indirect tax collections work well for government finances." TOI. GST came into force on 1 July 2017, replacing all central and state level taxes such as excise duty, VAT, services tax etc. cleartax.in. Since then it has been increasing every year, except for the Covid year of 2020-21. The average monthly collection has more than doubled from Rs 980.83 billion in 2018-19, the first full financial year of collections, to an expected Rs 1.9 trillion in 2025-26. blog.tatanexarc.com. This mirrors consumer price index (CPI) inflation rising to 4.07% in September 2019, soaring to 7.32% in December 2019 and then staying above an average of 6% till about January 2025. RI. GST is a percentage of the cost, so higher the price, the higher is the tax collection. The rate of inflation may be falling since last year, but, since inflation compounds from year to year, even smaller rises on a high base lead to higher GST collections. Not surprisingly "Profit before taxes for 33,000 sampled companies nearly quadrupled between 2019-20 and 2022-23." "Over that period, employment in these firms grew a mere 1.5%," and "real wages for regular workers contracted by 0.7%," wrote Ajit Ranade. India's net direct tax collections rose 5.12% to around Rs 23.40 trillion, while gross direct tax collections rose 4% year-on-year to Rs 28.1 trillion in the financial year ending 31 March. ET. The government is worried about the high cost of oil because of the Middle East conflict but not that worried about a poor monsoon. At worst, growth will fall to 6.7% from 6.9% and retail inflation will rise to 5%. BT. With employment elasticity of 0.01, jobs will fall from 0.069 to 0.067. No one will notice the difference. No worries.