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A slew of important economic data was released this week. Let us take a look at the economic indicators.
Gross Domestic Product (GDP)
India’s economic growth slowed down to 6.3% in the July-September quarter of FY23, as manufacturing output contracted. However, strong activity was witnessed in the services sector.
In comparison, the economy had expanded 13.5% in the quarter-ended June of FY23 due to a low base in the same period of FY22 on account of severe covid-19 restrictions.
Chief Economic Advisor V Anantha Nageswaran said that the Indian economy is on track to achieve a 6.8-7% GDP growth in the current fiscal. He further said the economic recovery momentum is continuing and the GDP is averaging the 2019-20 level.
Growth in private final consumption expenditure (PFCE), which is also know as private spending, grew at 9.7%, according to government data. The spending was attributed to robust consumption by consumers despite rising prices.
Gross fixed capital formation (GFCF), which represents investment demand in the economy, grew at a robust 10.4%, helped by strong capital expenditure by the central government and improvement in private investment activity.
Gross Value Added
India’s Gross Value Added, also known as GVA, in Q2FY23 grew by. 5.6% YoY, according to Ministry of Statistics and Programme Implementation (MoSPI). The National Statistical Office released the data which showed that manufacturing industry contracted 4.3% in the September 2022 quarter due to rising raw material costs weighing on corporate India’s profit margins. Mining & quarrying contracted 2.8 per cent, while agriculture, forestry and fishing industry rose 4.6%.
However, the three industries — trade, hotel, transport, communication and broadcasting services; financial, real estate & professional services; and public administration, defense and other services — grew 14.7%, 7.2% and 6.5%, respectively. Construction industry expanded 6.6% year-on-year in Q2FY23.
Export and Imports
Exports rose 11.51% to Rs 8,87,678 crore in constant price terms in the second quarter of FY23. Exports made up 23.3% as a share of GDP. Meanwhile, imports jumped 25.4% to Rs 12,16,365 crore. Imports as a shares in the GDP rose to 31.9% in Q2FY23 from 27% in Q2FY22.
GST Collection For November 2022
India’s gross GST revenue came in at Rs 1,45,867 crore in November 2022, 11% higher during the same period a year ago, but about 4% below October’s collections which stood at Rs 1.52 lakh crore on the back of festive spending. Among industrial states, Maharashtra (16%), Karnataka, Haryana (13% each), Andhra Pradesh (14.6%) and Tamil Nadu (10%) reported healthy double-digit growth. Gujarat did not make the cut.
During November 2022, revenues from import of goods were 20% higher and the revenues from domestic transaction, which included import of services, were 8% higher over November 2021.
Fiscal Deficit
India’s fiscal deficit during April to October 2022 widened to Rs 7.58 lakh crore, over 45.6% of FY23’s annual estimates, the central government reported. The fiscal deficit widened from 36.3% reported in the comparable year-earlier period, and the budget gap then was 5.47 lakh crore rupees. The data showed that the Total receipts stood at 13.86 lakh crore rupees, while overall expenditure in April to October was at 21.44 lakh crore rupees. Revenue receipts stood at 13.50 lakh crore rupees, of which tax revenue was 11.71 lakh crore rupees and non-tax revenue was 1.79 lakh crore rupees.
The spending on-year increased by Rs 3.17 lakh crore, from Rs 18.26 lakh crore to Rs 21.43 lakh crore. The capital expenditure increased from Rs 2.53 lakh crore to Rs 4.09 lakh crore on-year. The tax revenue for the April to October period in FY22 was Rs 13.64 lakh crore, increasing by Rs 2.45 lakh crore to Rs 16.09 lakh crore for the first seven months of this fiscal year.
Core Sector Output Growth
The growth rate in the production of eight key sectors slowed down to a 20-month low of 0.1% in October 2022 on account of contraction in the output of crude oil, natural gas, refinery products, and cement, according to the official data released. In October 2021, these sectors expanded by 8.7%. In September 2022, the core sectors’ output growth stood at 7.8%.
The government data showed sequential deceleration in output growth rate in sectors like coal (3.6% ), steel (4% ), electricity (0.4% ) and fertilisers (11.8% ). Crude oil (-2.2%), natural gas (-4.2%), cement (-4.3% ) and refinery products (-3.1% ) output contracted during the said period.
Retail Inflation For Industrial Workers
Retail inflation for industrial workers rose to 6.08% year-on-year in October 2022 compared with 6.49% YoY in September 2022 mainly due to lower prices of certain food items, according to data released by the labour department. Similarly, it stated that food inflation stood at 6.52% as against 7.76% in September 2022 and 2.2% during October 2021.
The consumer price index for industrial workers for October 2022 increased by 1.2 points and stood at 132.5 points. It was 131.3 points in September 2022.
All-India Group-wise CPI-IW for September 2022 and October 2022
Groups | Sep-22 | Oct-22 |
Food & Beverages | 131.9 | 133.9 |
Pan, Supari, Tobacco & Intoxicants | 147.3 | 148.5 |
Clothing & Footwear | 129.7 | 131.9 |
Housing | 121 | 121 |
Fuel & Light | 177.8 | 177.8 |
Miscellaneous | 127.5 | 128.4 |
General Index | 131.3 | 132.5 |
Manufacturing PMI
India’s manufacturing sector activity rose to a 3-month high in November as new orders and exports increased, according to a monthly survey by S&P Global. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) stood at 55.7 in November, up from 55.3 in October, signalling the strongest improvement in operating conditions in three months.
The November PMI data pointed to an improvement in overall operating conditions for the 17th straight month. A reading above 50 signals expansion of the sector, while a score below 50 indicates contraction.
Unemployment
India’s unemployment rate rose to a three-month high at 8% during November 2022, according to data by the Centre for Monitoring Indian Economy (CMIE). India’s unemployment rate in October was at 7.77%, while in September it stood at 6.43%, according to the data.
The CMIE report said that the unemployment rate in urban India was higher at 8.96%, while in rural areas, it was at 7.55%. In October 2022, the urban joblessness was at 7.21% and the rural unemployment rate was at 8.04%.
Among the states, Haryana continued to have the highest unemployment rate in the country in November at 30.6% , followed by Rajasthan at 24.5%, Jammu and Kashmir at 23.9%, Bihar at 17.3% and Tripura at 14.5%, the data showed.