SINGAPORE: International Monetary Fund (IMF) welcomed passage of the long-pending Goods and Services Tax (GST) by the Indian parliament, saying it will lead to long-term sustainable growth in the country.

"We welcome the introduction of GST and one of the fiscal reforms and it is one of the key elements for the long-term sustainable growth in India," IMF's Director for Asia and Pacific Department Changyong Rhee said.

"It would be one of the most important agenda of (Prime Minister Narendra) Modi government," he said.

But it remains a very important question as how to implement at the state levels and coordinate, he said at a press conference here presenting IMF's Regional Economic Outlook for Asia and Pacific.

Responding to questions, Rhee said, "We have already count on the implementation of the GST in the 2016 GDP forecast (of 7.5 per cent)."

The GST - originally mooted by the UPA - will subsume excise, service tax, state Value Added Tax (VAT), entry tax, octroi and other state levies after its implementation from April 1, 2016.

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