Finance Ministry reports economy revival on track. The finance ministry has reports that “green shoots” have started to emerge in the economy. Highlighting several data points in its monthly macro-economic report, the department of economic affairs said total digital retail financial transactions via NPCI platforms rose from Rs 6.71 lakh crore in April to Rs 9.65 lakh crore in May. Consumption of petroleum products jumped 47% from 99.37 lakh tonnes in April to 146.46 lakh tonnes in May. Kharif sowing climbed 104.3% year on year, with Rabi procurement in full flow with respect to oilseeds, pulses and wheat due to a bumper harvest.

The report headed by FM Nirmala Sitharaman says within just two months, India, starting from scratch, has become the world’s second largest manufacturer of personal protective equipment (PPE). Electricity consumption saw lower y-o-y contraction from minus 24% in April to minus 15.2% in May to minus 11.3% in June (until June 28). Total assessable value of e-way bills picked up by a massive 130% in May, compared with April, tracking a surge in inter and intra-state road-based movement of tradable goods.In June, it further rose by 34% over the preceding month.

India Back On Track

Average daily electronic toll collections. Yet another indicator of freight movement by road. Which increased from Rs 8.25 crore in April to Rs 36.84 crore in May. And further to Rs 50.9 crore in June (till June 28), the report has highlighted.

The IMF has predicted a contraction of 4.5 per cent (-4.5 per cent growth) for India in 2020. A 6.4 percentage point downward revision compared to the April 2020 forecast. The Department of Economic Affairs said in its macroeconomic report for June.

India’s forex reserves at $505.6 billion, continue to provide a crucial cushion to external shocks on the back of higher FDI, portfolio flows and low oil prices. This recovery is also evident in the Goods & Services Tax (GST) collections for June 2020 that clocked Rs 90,917 crore at gross levels, 46% higher than May and 181% over April. “These green shoots have a conducive policy environment to grow further. And nudge the economy early on the path of economic recovery and growth”. It said.

The Union Government with the aid of Central Bank have been active in announcing relief packages. Like extension of loan moratorium. Reduction in lending rates among others to boost the economy in th ecurrent times. PM Modi has also launched a campaign for ‘Aatmanirbhar’ and go ‘Vocal for Local’. Which is expected to give an impetus to the MSMEs and domestic companies.

The country’s trade deficit narrowed to $3.1 billion in May 2020 – the lowest since February 2009.

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TOPICS: Covid19 Indian Economy Nirmala Sitharaman