GST 2.0: Empowering livelihoods and growth in Uttar Pradesh

New Delhi, Oct 2 (IANS) The GST reforms provide targeted relief to Uttar Pradesh's diverse economy spanning GI-registered carpets, brassware, Zardozi, footwear, ceramics, sports goods and cement.

Lower tax rates are expected to improve affordability for households, ease working-capital pressures on artisans, and strengthen MSME competitiveness in both domestic and global markets, according to an official statement issued on Thursday.

Bhadohi carpets, Moradabad brassware, and Saharanpur woodcraft are expected to become 6–7 per cent cheaper, boosting exports and sustaining lakhs of artisan jobs. The Bhadohi–Mirzapur–Jaunpur region is one of India's largest hand-knotted and handwoven carpet clusters.

Following the GST cut from 12 per cent to 5 per cent, handmade carpets will become cheaper. This is likely to improve affordability in domestic markets, strengthen export competitiveness, and ease working-capital pressures for family looms and SMEs that dominate the cluster.

The leather and footwear clusters in the Kanpur–Agra belt, employing 1.5 million workers, will also benefit from the GST rate cut which will improve the competitiveness of MSME and lead to higher exports.

The Firozabad glassware, Khurja ceramics, and Gorakhpur terracotta stand to gain from lower costs, supporting fragile clusters and festival demand as prices come down due to the reduction in GST.

The GST rate cut will boost Lucknow's Zardozi, a GI-registered craft and an ODOP-promoted product, which provides livelihood to around 1.5-2 lakh artisans, with women forming a large share of the workforce in cottage and small-scale units producing these embellished fabrics . The craft serves strong domestic demand from weddings and festivals, along with exports to the Middle East, Europe and the USA.

Agra's famed marble inlay craft (Parchinkari), carried forward by artisan families in Agra, Firozabad and Mathura, remains closely tied to tourism. The cluster sustains 5,000–20,000 workers, including carvers, polishers and inlay artists, many supported under ODOP initiatives.

The sector is closely tied to tourism and décor markets, with additional sales through online gifting and limited niche exports to Europe and the Gulf. A GI application for Agra Parchinkari is under examination, and the craft is globally recognised for its link to the Taj Mahal's heritage.

The GST rate reduction from 12 per cent to 5 per cent is expected to make stone handicrafts more affordable for tourists and domestic buyers, boosting sales and easing cost pressures on small workshops.

GST 2.0 will boost cottage-based and family-run units that dominate Uttar Pradesh’s embroidery sector, with nearly 2.5–3 lakh artisans engaged across Lucknow, Varanasi and Bareilly (NIFT and MSME reports).

Women make up a large share of the workforce, particularly in semi-urban and rural households. Lucknow Chikan Craft and Varanasi Zardozi Work are both GI-registered and recognised ODOP products, receiving special promotional support.

The GST reforms will give a fillip to the wooden toy and craft sector in Uttar Pradesh is sustained by family artisans, many of whom work from their homes.

The clusters in Varanasi and Chitrakoot alone employ around 15,000–25,000 artisans, while Saharanpur is home to thousands more engaged in woodworking and carving. Rampur is also part of this traditional craft network. The clusters cater to strong domestic demand through fairs, religious toys and décor, with modest exports reaching Europe and the Gulf.

With GST reduced from 12 per cent to 5 per cent, toys and small crafts are expected to become cheaper, improving affordability in local markets and helping artisans compete with machine-made plastic products.

The GST reforms will also benefit sports good clusters of the state in Meerut and Modinagar, with 30,000–35,000 workers engaged in small units, MSMEs and larger factories. The sector produces cricket and hockey equipment for a domestic market worth about Rs 250 crore, while also exporting to the UK, Australia, Africa and the Middle East. It is supported under ODOP with marketing and MSME assistance.

With GST reduced from 12 per cent to 5 per cent, sports goods are expected to be cheaper. This is likely to boost demand in the domestic market, improve export competitiveness, and support employment stability across small and medium enterprises.

The GST reduction from 28 per cent to 18 per cent will spur growth in Uttar Pradesh’s cement industry, spread across Mathura, Chunar (Mirzapur), Firozabad and Aligarh, is dominated by large-scale industrial plants. The sector employs about 15,000–20,000 direct workers and another 10,000 in transport, raw material supply and construction-linked services.

These clusters are located around limestone-rich areas, ensuring efficient supply chains. While the domestic market is driven by housing, infrastructure and construction, limited clinker exports also go to Nepal and Bangladesh.

The GST rate reduction will make cement more affordable, lowering construction costs for developers and households, improving competitiveness against imports, and encouraging expansion of industrial plants and logistics services.

--IANS

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