<h1>RBI Report Highlights GST's Impact on India's Economy, Growth, and State Finances; Stresses Need for Strong Dispute Resolution Mechanism.</h1> The Reserve Bank of India's report, 'State Finances: A Study of Budgets of 2016-17,' emphasizes the significant impact of the Goods and Services Tax (GST) on India's economy. GST is expected to influence growth, inflation, government finances, and external competitiveness, while promoting cooperative federalism between the Centre and states. It is seen as crucial for states to achieve fiscal consolidation without reducing productive expenditure. The report suggests that challenges in GST implementation be addressed through a robust dispute resolution mechanism and highlights the importance of debt sustainability for state finances. The report is prepared by the Fiscal Analysis Division of the RBI.