Home » Commerce and Industry » FY 2021-22: Rising Industrial growth, Restrained Inflation and Strong Services Revival

FY 2021-22: Rising Industrial growth, Restrained Inflation and Strong Services Revival

The release of quick estimates of Index of Industrial Production (IIP) for the month of September, 2021 shows a sustained increase in industrial production. The IIP, in FY 2021-22, has grown from an average of 121.3 in Q1 to 130.2 in Q2. The IIP in Q2 would have been still higher but for heavy monsoons disrupting mining activity, especially coal and consequently electricity generation, that repressed the growth of overall production index.

The manufacturing index in IIP has held steady and is likely to rise in subsequent months mirroring the eight-month high in Purchasing Manager’s Index (PMI) for manufacturing reaching 55.9 in October, 2021.

A sharp increase in capital goods index from an average of 74.0 in Q1 of FY 2021-22 to 91.7 in Q2 underscores a significant recovery in investment.

There are clear signs of investment being induced by rise in consumption in FY 2021-22 as consumer durables index increases from 91.7 in Q1 to 121.2 in Q2 while consumer non-durables index also moves up from 139.1 to 146.9 across the two quarters.

The release of Consumer Price Index (CPI) numbers for the month of October 2021 shows that the decline in annual consumer price inflation has now gradually set in FY 2021-22. The annual CPI inflation has declined from 5.6 per cent in Q1 to 5.1 per cent in Q2 and it is lower still at 4.5 per cent in October of FY 2021-22.

Similarly, Consumer Food Price Inflation (CFPI) has declined from 4.0 per cent in Q1 of FY 2021-22 to 2.6 per cent in Q2 and further to 0.8per cent in October showing that supply side disruptions to food distribution have considerably eased.

Activity levels have been steadily increasing in FY 2021-22 as reflected in the latest levels of several High Frequency Indicators including E-way bills, power consumption and GST collections. GST collections have soared in FY 2021-22 to reach its second highest monthly collections ever ofRs.1.3 lakh crore in October, 2021, reflecting robustness of growth revival. Tractor sales hit a record high of 1,15,615 units in October 2021, 25 % higher than September, 2021 volumes, indicative of sustained growth in the agricultural sector.

PMI services has accelerated to a decadal high of 58.4 in October, 2021, suggesting a strong revival in contact-based services sector with the weakening of the pandemic. Average Hotel Occupancy rate in leisure destinations rising from about 55 per cent in Q1 of FY 2021-22 to over 60 per cent in Q2 underscores the service sector growing optimism.

Exports are visibly emerging as the engine of growth for India’s economy having crossed $30 billion for the seventh successive month in October of FY 2021-22. On a cumulative basis, India’s merchandise exports in April-October stood at $232.58 billion, up 54.5% over the same period in 2019.

Outstanding credit of the scheduled commercial banks has been steadily rising in FY 2021-22. Retail credit in particular has been noticeably increasing suggestive of strengthening consumption in the economy. According to CIBIL, inquiry volumes have increased by 54 per cent between February and October of 2021 as economic activity has gained momentum.

About IIPnews

Leave a Reply

Your email address will not be published. Required fields are marked *

*

x

Check Also

RBI plays a pivotal role in advancing our nation’s growth trajectory

The Prime Minister, Shri Narendra Modi addressed the opening ceremony of RBI@90, a program marking ...

GeM crosses ₹ 4 Lakh Crore in GMV at the end of this Fiscal Year, doubles business in a year

Government e Marketplace has closed this financial year with ₹ 4 lakh crore in Gross ...

Combined Index of Eight Core Industries increases by 6.7% (provisional) in Feb 2024 as compared to Index of Feb 2023

The combined Index of Eight Core Industries (ICI) increased by 6.7per cent (provisional) in February 2024 ...

Highest monthly merchandise exports, in the current FY so far, recorded in February 2024. India’s merchandise exports in February 2024 stands at USD 41.40 Billion; an increase of 11.86% over USD 37.01 Billion in February 2023

India’s overall exports (Merchandise and Services combined) in February 2024* is estimated to be USD ...

Index Numbers of Wholesale Price in India for the Month of February, 2024 (Base Year: 2011-12)

The annual rate of inflation based on all India Wholesale Price Index (WPI) number is ...

Government of India notifies extension of Remission of Duties and Taxes on Exported Products support to Advance Authorisation Holders, Export Oriented Units and Special Economic Zones Units

Union Minister of Commerce & Industry, Consumer Affairs, Food and Public Distribution, and Textiles, Shri ...

Financial assistance under ‘Tea Development & Promotion Scheme’ increases by 82% from Rs. 290.81 crores to Rs.528.97 crore for 2024-25 and 2025-26

The financial assistance for the Tea sector under the ‘Tea Development & Promotion Scheme’ has ...

Cabinet approves Uttar Poorva Transformative Industrialization Scheme, 2024

The Union Cabinet chaired by Prime Minister Shri Narendra Modi approved the proposal of the Ministry of ...

Union Finance Minister Smt. Nirmala Sitharaman inaugurates first-ever National Conference of Enforcement Chiefs of the State and the Central GST Formations in New Delhi

Union Minister for Finance and Corporate Affairs Smt. Nirmala Sitharaman inaugurated the first-ever National Conference ...

Financial Intelligence Unit-India (FIU-IND) imposes penalty of Rs. 5,49,00,000 on Paytm Payments Bank Ltd with reference to violations of its obligations under PMLA

The Financial Intelligence Unit-India (FIU-IND), in furtherance of the powers conferred upon the Director FIU-IND ...

WP2Social Auto Publish Powered By : XYZScripts.com