INDIA ECONOMY NEWS
India's GDP calculations set for an upgrade as MOSPI sets up panel to revise base year
The Ministry of Statistics and Programme Implementation (MoSPI) has formed a 26-member committee led by Biswantah Goldar to update the base year for national accounts, aiming to align key economic indices with current economic trends. This includes potentially shifting from the current base year of 2011-12 to 2020-21 for indices like the Wholesale Price Index (WPI), Producer Price Index (PPI), and Consumer Price Index (CPI).
Fiscal deficit hits 3% of full FY25 target in April-May at Rs 50,615 crore
India's fiscal deficit for April-May reached approximately 3% of FY25's target, totaling Rs 50,615 crore. PM Narendra Modi's third term priorities include tackling agricultural distress, job creation, sustaining capital expenditure, and enhancing revenue growth for fiscal consolidation. S&P upgraded India's sovereign rating outlook to positive, contingent on fiscal discipline
Guyana diaries: Bhojpuri nights, ubiquitous Hindu temples & booming economy
Guyana exudes a strong sense of Indianness that resonates deeply with visitors from India, particularly noticeable in Georgetown, its capital and the only English-speaking country in South America. The Providence Cricket Stadium greets visitors with a prominent "Bhojpuri Nights" banner, reflecting the cultural blend. Nearby, ISKCON stands as one of Georgetown's largest temples, underscoring the presence of Indian culture. Renowned eateries like the one owned by former West Indies cricketer Ramnaresh Sarwan offer a taste of familiar cuisine.
India's bubbling water crisis can spark social unrest, exacerbate volatility in economy's growth: Moody's
Reduced water availability has the potential to interrupt both agricultural and industrial activities, leading to increased food prices and income reductions for impacted businesses and workers, particularly farmers. This situation may lead to social unrest, further destabilizing India's economic growth and its resilience to unforeseen challenges, considering that over 40% of the nation's workforce is engaged in agriculture.
India's FY24 CAD reduces to 0.7% of GDP from 2% in FY23, records surplus of 0.6% in Q4
India's current account deficit improved significantly to 0.7% of GDP, or $23.2 billion in FY24, down from 2% of GDP, or $67 billion the previous year, attributed to a decrease in merchandise trade deficit, according to the Reserve Bank of India. The country's current account balance showed a surplus of 0.6% of GDP in Q4 FY24, a turnaround from deficits in earlier quarters.
Joint press conference by PM Modi and Bangladeshi PM Sheikh Hasina | Live
Joint press conference by PM Modi and Bangladeshi PM Sheikh HasinaJoint press conference by PM Modi and Bangladeshi PM Sheikh Hasina | Live
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Rising vegetable prices strain household budgets across India: Survey
A survey by LocalCircles highlighted significant consumer concerns over rising prices of essential vegetables—onion, potato, and tomato. It found that 16% of households are cutting consumption or feeling financial strain due to these price hikes, with another 31% anticipating impact if prices exceed INR 50 per kg. Currently, 2 in 3 households are paying above-average prices: Rs 25/kg or more for tomatoes, Rs 30/kg or more for potatoes, and Rs 35/kg or more for onions.
India's disinflation process proving to be arduous thanks to stubborn food inflation: RBI Guv Das
RBI Governor Shaktikanta Das stated that bringing India's retail inflation to the 4% target is challenging due to persistent food price inflation, driven by weather-related supply issues. Speaking at an event, he highlighted that despite moderating core inflation, food inflation remains high, averaging 8% over the past seven months.
India's fast-growing economy has a problem
India faced criticism for withholding a labor survey revealing high unemployment until after Modi's re-election in 2019.
Knowledge economy, not silly conformity
The fact that 'unpleasantness' is perceived as a criterion for textbook excision tells a sad story about NCERT's understanding of pedagogy and knowledge. If fake facts for our young are to join the trough of fake news to maintain some skewed notion of national 'pleasantness', we'll be entering pamphleteering territory of 'Mao's Little Red Book' variety instead of one that encourages critical thinking and disparate ideas, and prepares our young to engage and navigate the difficult questions of life and society.
Services activity growth eases to 5-month low in May
India's services sector output growth moderated in May, reaching its lowest level in five months, according to the HSBC India Services Business Activity Index. The index slipped to 60.2 from 60.8 in April, indicating a softening in services activities due to factors like severe heat waves and price pressures. While domestic new orders eased slightly, they remained robust, supported by strong demand conditions and successful advertising. Export demand also provided support, with new orders rising at the fastest pace in nearly a decade.
Past reforms will continue to drive economy over next 2 years: Neelkanth Mishra
In fact, with the RBI dividend being significantly better than what was budgeted, I would not be surprised if in the July budget, the government chooses to bring down its FY25 fiscal deficit target from 5.1% to 4.9% because that money is there.
Rising heat cools mfg PMI to 3-mth low as input costs bite
Manufacturing activity decreased to 57.5 in May from 58.8 in the previous month due to heatwaves and rising costs, as per a private survey by HSBC. The sector saw a softer rise in new orders and output, impacting work hours and production volumes for manufacturing firms.
Big Daddy LIC manages money nearly double the size of Pakistan's economy
LIC assets have exceeded Rs 50 lakh crore, marking a significant milestone and overshadowing Pakistan's GDP. In FY24, LIC reported a profit of Rs 40,676 crore and total premium income of Rs 4,75,070 crore. The company, with a market share of nearly 59% in the Indian life insurance sector, is now eyeing entry into the health insurance domain. Its market value has surged by nearly 52% in the past six months, making it the seventh-largest stock by market capitalization.
A likely Modi 3.0 might just give Indian economy what it wanted for so long
India's chances of soverign rating upgrade is likely high. Exit polls predict Narendra Modi's BJP-led NDA will secure a third term with a significant majority. The NDA is expected to surpass its 2019 tally, easing concerns about replicating previous success. This likely continuity boosts economic confidence, with S&P upgrading India's outlook to "positive" and fiscal indicators showing robust growth and reduced deficit.
GST collection in May moderates from record high to Rs 1.73 lakh crore
In May, the Centre collected Rs 1.73 lakh crore in GST, a 10% annual increase. This is down from April's record Rs 2.1 lakh crore. The growth stemmed from a 15.3% rise in domestic transactions and a 4.3% decline in imports. Net GST revenue, after refunds, was Rs 1.44 lakh crore.
FY24 GDP growth at 8.2 pc great news for India: Panagariya
Arvind Panagariya, the chairman of the 16th Finance Commission, praised India's GDP growth rate of 8.2% for the fiscal year 2023-24, calling it "great news for India." However, the National Statistical Office (NSO) reported that India's economy grew at a four-quarter low of 7.8% in the March quarter. The GDP growth rate for the fiscal year 2023-24 surpassed the 7% recorded in the previous fiscal year. ICRA Chief Economist Aditi Nayar noted a sequential slowdown driven by investment activity, while PHDCCI President Sanjeev Agrawal highlighted the growth as a reflection of efforts towards "Viksit Bharat by 2047."
India's fiscal deficit improves to 5.6% of GDP in FY24, lower than target of 5.8%
India's FY24 fiscal deficit hit Rs 16.54 lakh crore, 95.3% of target. Central government's FY24 fiscal deficit stood at at 5.6% GDP, below 5.8% estimate. Tax receipts surpassed at Rs 23.27 trillion, 100.1% target. Expenditure at Rs 44.43 trillion, 99% target. Capital expenditure at Rs 9.49 lakh crore. Fiscal discipline aims for 5.1% deficit in FY25.
India's core sector growth rises 6.2% in April
India's index of eight core sectors saw a 6.2% annual growth in April, following a 6.6% growth in March. The eight sectors had grown 4.6% in April 2023. The production of electricity, natural gas, coal, steel, refinery products, crude oil, and cement showed positive growth. However, coal sector output decreased by 7.5% YoY, while crude oil sector saw a 1.6% growth.
RBI projects real GDP growth at 7% in FY25, says outlook for Indian economy remains bright
The Reserve Bank of India's annual report projects a 7% growth for the Indian economy in the current fiscal year. It highlights the economy's resilience and sustained strengthening of macroeconomic fundamentals. The report notes a robust expansion in the previous fiscal year, with real GDP growth reaching 7.6%. Despite headwinds, the outlook remains positive due to government investments and consumer optimism.
RBI's balance sheet size is now 2.5x the size of Pakistan's GDP
The Reserve Bank of India's balance sheet grew by 11.08% to Rs 70.48 lakh crore as of March 31, 2024. The RBI's income rose by 17.04%, while expenditure decreased by 56.30%. Consequently, the RBI's surplus increased by 141.23% to Rs 2.11 lakh crore, transferred to the Centre.
S&P Global will likely raise India's rating within 2 years, Citi says
Citi anticipates S&P Global Ratings will upgrade India's sovereign rating by late 2026, following S&P's recent outlook improvement to 'positive' from 'stable'. Citi cites S&P's confidence in India's economic fundamentals and fiscal trajectory. India's fiscal health, aiming to reduce its deficit, is key to the potential upgrade.
RBI approves dividend of Rs 2.11 lakh crore to Centre for FY24, up 140% YoY
RBI DIVIDEND: At its 608th meeting in Mumbai, the Reserve Bank of India approved a dividend of Rs 2.11 lakh crore for the Central government for FY24, marking a 141% increase from FY23's Rs 87,416 crore. This move, reported earlier by ET, aids the Centre in reaching its fiscal deficit target for FY25.
Extreme deprivation, once synonymous with India, is set to become extinct: RBI
The Reserve Bank of India, in its monthly bulletin, highlighted India's imminent economic upturn, noting international recognition and anticipation of poverty eradication. The central bank emphasized growing optimism globally and cited commendation from external agencies like the International Monetary Fund for India's significant strides in reducing poverty.
India's services sector shows strongest growth rates in around 14 years: PMI data
In April, India's services sector saw a slight moderation, but maintained strength due to robust domestic and international demand, boosting business confidence to a three-month high. Despite a dip in the HSBC Services PMI to 60.8 from March's 61.2, it remained among the fastest growth rates in nearly 14 years.
Manufacturing activity eases slightly to 58.8 in April; optimism improves
Buoyant domestic demand ensured a strong start for the fiscal, with the manufacturing activity easing slightly to 58.8 in April compared with 59.1 in the previous month, according to results of a private survey released Thursday.
India's manufacturing sector still strong even as PMI eases from a 16-year high in April
In April, India's manufacturing sector saw a slight slowdown, yet remained strong due to high demand, revealed by a private business survey. This surge in demand drove companies to increase raw material procurement nearly to record levels. The HSBC final India Manufacturing Purchasing Managers' Index dipped to 58.8 from March's 16-year high of 59.1.
GST revenue collection hits record high of Rs 2.10 lakh cr in April
India's Goods and Services Tax (GST) collections soared to a new peak of Rs 2.10 lakh crore in April, marking a 12.4% increase from the previous year, according to the Finance Ministry. The surge was fueled by a 13.4% rise in domestic transactions and an 8.3% increase in imports.
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