Key Points

Lower tax rates will bring down prices for consumers, ease working capital for MSMEs, and expand market competitiveness for exporters. The impact will be visible across fisheries, dairy, automobiles, pharmaceuticals, medical devices, renewable energy, handicrafts, and everyday essentials.

Andhra Pradesh contributed 41 per cent of India’s fish production in 2022–23. The sector accounts for 7.4 per cent of the state’s GSDP and provides employment to around 14.5 lakh people in the 9 coastal districts of the state.

With GST reduced from 12 or 18 per cent to 5 per cent on fish oils, extracts, preserved products, fishing gear, diesel engines, pumps, aerators and key chemicals, input costs will decline, easing the burden on small processors and traditional fishing communities. Andhra Pradesh accounts for over 30 per cent of India’s seafood exports shipped mainly from Visakhapatnam Port to markets such as the US, China, the EU, Southeast Asia and the Middle East. These reforms will improve affordability, boost competitiveness in global trade, and strengthen livelihoods along the state’s coastline, the statement said.

The state’s dairy sector is ranked 4th nationally in milk production and supports 24 lakh farmers, many of them women in self-help groups and cooperatives. Major brands like Heritage and Vijaya anchor collection, chilling, processing and retail networks across the state.

With GST reduced to zero on UHT milk and paneer, from 12 per cent to 5 per cent on ghee and butter, and from 18 per cent to 5 per cent on ice-cream, these products will become cheaper for consumers. This will boost demand and generate higher incomes for dairy farmers and SHG-led cooperatives in districts such as Krishna, Srikakulam, West Godavari, East Godavari, Guntur, Chittoor, and Vizianagaram.

Andhra Pradesh has also emerged as a key auto hub, with major plants of Kia, Isuzu, Hero, and Ashok Leyland alongside over 100 auto-component MSMEs in districts such as Anantapur, Chittoor, Visakhapatnam, and Nellore. The sector employs more than 11,000 people, including skilled technicians, ITI diploma holders and engineers. The GST rate cuts have made three-wheelers, small cars and motorcycles (up to 350cc engine capacity) and all auto parts more affordable. This will increase consumer demand and reduce working capital pressures for manufacturers, which also strengthens the competitiveness of Andhra’s auto exports to Europe, the US, and South Korea, according to the statement.

In the pharma sector, the state is home to over 250 bulk drug and API units across Anakapalli, Visakhapatnam, Atchutapuram, Naidupeta, and Pydibhimavaram. The sector employs more than 89,000 highly skilled workers, supporting both manufacturing and R&D.

GST cuts from 12 per cent to nil on 30 cancer drugs, and from 12 per cent to 5 per cent on medicines for personal use, make healthcare more affordable across India. Global companies such as Dr Reddy’s, Aurobindo Pharma, GSK, Lupin and Biocon operate in the state, while exports, led by the USA (52 per cent), South Africa and China, reinforce Andhra’s role as a pharma powerhouse.

The state’s AP MedTech Zone (AMTZ) in Visakhapatnam houses over 100 manufacturing units producing medical devices, diagnostics and healthcare technologies. With GST reduced from 18 per cent to 5 per cent on devices like thermometers and medical apparatus, and from 12 per cent to 5 per cent, healthcare has become more affordable and accessible for domestic patients, while strengthening Andhra Pradesh’s exports to over 80 countries.

With capacity growing more than seven-fold between 2014 and 2024, clusters in Kurnool, Kadapa and Anantapur have positioned the state as a front-runner in renewable energy adoption. The GST rate cuts are poised to boost this sector further.

Similarly, the state’s handicrafts sector also stands to benefit from the GST rate cuts. Andhra Pradesh is famous for its GI-tagged Etikoppaka & Kondapalli Toys, stone carvings and leather puppetry, which will get a boost, the statement added.

- IANS