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State of the Indian Economy

By Spotlight - 26-03-2019

India has emerged as the fastest growing major economy in the world as per the Central Statistics Organisation (CSO) and International Monetary Fund (IMF) and it is expected to be one of the top three economic powers of the world over the next 10-15 years, backed by its strong democracy and partnerships. 

Market size: India's gross domestic product (GDP) grew by 6.3 per cent in July-September 2017 quarter as per the Central Statistics Organisation (CSO). Corporate earnings in India are expected to grow by over 20 per cent in FY 2017-18 supported by normalisation of profits, especially in sectors like automobiles and banks.

The tax collection figures between April-June 2017 Quarter show an increase in Net Indirect taxes by 30.8 per cent and an increase in Net Direct Taxes by 24.79 per cent year-on-year, indicating a steady trend of healthy growth. The total number of e-filed Income Tax Returns rose 21 per cent year-on-year to 42.1 million in 2016-17 (till 28.02.17), whereas the number of e-returns processed during the same period stood at 43 million.

India has retained its position as the third largest startup base in the world with over 4,750 technology startups, with about 1,400 new start-ups being founded in 2016, according to a report by NASSCOM.

India's labour force is expected to touch 160-170 million by 2020, based on rate of population growth, increased labour force participation, and higher education enrolment, among other factors. India's foreign exchange reserves were US$ 404.92 billion in the week up to December 22, 2017.

Recent Developments
With the improvement in the economic scenario, there have been various investments in various sectors of the economy. The M&A activity in India increased 53.3 per cent to US$ 77.6 billion in 2017 while private equity (PE) deals reached US$ 24.4 billion. Some of the important recent developments in Indian economy are as follows:

•    Indian companies raised Rs 1.6 trillion (US$ 24.96 billion) through primary market in 2017.
•    Moody’s upgraded India’s sovereign rating after 14 years to Baa2 with a stable economic outlook.
•    India received net investments of US$ 17.412 million from FIIs between April-October 2017.
•    The top 100 companies in India are leading in the world in terms of disclosing their spending on corporate social responsibility (CSR), according to a 49-country study by global consultancy giant, KPMG.
•    The bank recapitalisation plan by Government of India is expected to push credit growth in the country to 15 per cent.
•    India has improved its ranking in the World Bank's Doing Business Report by 30 spots over its 2017 ranking and is ranked 100 among 190 countries.
•    India's ranking in the world has improved to 126 in terms of its per capita GDP, based on purchasing power parity (PPP) as it increased to US$ 7,170 in 2017.
•    The Government of India has saved US$ 10 billion in subsidies through direct benefit transfers with the use of technology, Aadhaar and bank accounts.
•    India is expected to have 100,000 startups by 2025, which will create employment for 3.25 million people and US$ 500 billion in value.
•    The total projected expenditure of Union Budget 2018-19 is Rs 23.4 lakh crore (US$ 371.81 billion), 9 per cent higher than previous year's budget, as laid out in the Medium Term Expenditure Framework (MTEF).
•    India received the highest ever inflow of equity in the form of foreign direct investments (FDI) worth US$ 43.4 billion in 2016-17 and has become one of the most open global economies by ushering in liberalisation measures.
•    The World Bank has stated that private investments in India is expected to grow by 8.8 per cent in FY 2018-19 to overtake private consumption growth of 7.4 per cent, and thereby drive the growth in India's gross domestic product (GDP) in FY 2018-19.
•    The Niti Aayog has predicted that rapid adoption of green mobility solutions like public transport, electric vehicles and car-pooling could likely help India save around Rs 3.9 trillion (US$ 60 billion) in 2030.
•    Indian impact investments may grow 25 per cent annually to US$ 40 billion from US$ 4 billion by 2025.
•    The Union Cabinet, Government of India, has approved the Central Goods and Services Tax (CGST), Integrated GST (IGST), Union Territory GST (UTGST), and Compensation Bill.
•    Indian merchandise exports in dollar terms registered a growth of 30.55 per cent year-on-year in November 2017 at US$ 26.19 billion.

Government Initiatives
In the Union Budget 2017-18, the Finance Minister, Mr Arun Jaitley, verified that the major push of the budget proposals is on growth stimulation, providing relief to the middle class, providing affordable housing, curbing black money, digitalisation of the economy, enhancing transparency in political funding and simplifying the tax administration in the country.
India's unemployment rate has declined to 4.8 per cent in February 2017 compared to 9.5 per cent in August 2016, as a result of the Government's increased focus towards rural jobs and the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme.
Numerous foreign companies are setting up their facilities in India on account of various government initiatives like Make in India and Digital India. Mr. Narendra Modi, Prime Minister of India, has launched the Make in India initiative with an aim to boost the manufacturing sector of Indian economy, to increase the purchasing power of an average Indian consumer, which would further boost demand, and hence spur development, in addition to benefiting investors. The Government has also come up with Digital India initiative, which focuses on three core components: creation of digital infrastructure, delivering services digitally and to increase the digital literacy.

Some of the recent initiatives and developments undertaken by the government are listed below:
•    The Government of India has succeeded in providing road connectivity to 85 per cent of the 178,184 eligible rural habitations in the country.
•    All villages have been electrified in India by May 2018.
•    The Government of India has decided to invest Rs 2.11 trillion (US$ 32.9 billion) to recapitalise public sector banks over the next two years and Rs 7 trillion (US$ 109.31billion) for construction of new roads and highways over the next five years.
•    The mid-term review of India's Foreign Trade Policy (FTP) 2015-20 has been released by Ministry of Commerce & Industry, Government of India, under which annual incentives for labour intensive MSME sectors have been increased by 2 per cent.
•    The India-Japan Act East Forum, under which India and Japan will work on development projects in the North-East Region of India will be a milestone for bilateral relations between the two countries.
•    The Government of India will spend around Rs 1 lakh crore (US$ 15.62 billion) during FY 18-20 to build roads in the country.
•    The Government of India plans to facilitate partnerships between gram panchayats, private companies and other social organisations, to push for rural development under its 'Mission Antyodaya' and has already selected 50,000 panchayats across the country for the same.
•    The fiscal deficit of the Government of India, which was 4.5 per cent of the gross domestic product (GDP) in 2013-14, has steadily reduced to 3.5 per cent in 2016-17 and is expected to further decrease to 3.2 per cent of the GDP in 2017-18.
•    The Government of India plans to implement a new scheme, named 'Sasti Bijli Har Ghar Yojana' with an outlay of Rs 17,000 crore (US$ 2.64 billion), to provide electricity to around 40 million un-electrified households in the country.
•    India's revenue receipts are estimated to touch Rs 28-30 trillion (US$ 436- 467 billion) by 2019, owing to Government of India's measures to strengthen infrastructure and reforms like demonetisation and Goods and Services Tax (GST).

Road Ahead
India's gross domestic product (GDP) is expected to reach US$ 6 trillion by FY27 and achieve upper-middle income status on the back of digitisation, globalisation, favourable demographics, and reforms.
India is also focusing on renewable sources to generate energy. It is planning to achieve 40 per cent of its energy from non-fossil sources by 2030 which is currently 30 per cent and also have plans to increase its renewable energy capacity from 57 GW to 175 GW by 2022.
India is expected to be the third largest consumer economy as its consumption may triple to US$ 4 trillion by 2025, owing to shift in consumer behaviour and expenditure pattern and is estimated to surpass USA to become the second largest economy in terms of purchasing power parity (PPP) by the year 2040.


India tops list of fastest growing economies for coming decade

India tops the list of the fastest growing economies in the world for the coming decade and is projected to grow at 7.9 per cent annually, ahead of China and the US, according to a Harvard University report. 

The Centre for International Development (CID) at Harvard University said that countries that have diversified their economies into more complex sectors, like India and Vietnam, are those that will grow the fastest in the coming decade. "India tops the list as the fastest growing country for the coming decade, at 7.9 per cent annually, in the economic complexity growth projections. India has made inroads in diversifying its export base to include more complex sectors, such as chemicals, vehicles, and certain electronics," the report said. 

It said that India's productive capabilities far exceed expectations for its current income level, which contributes to the projection of rapid growth for the coming decade. The researchers also find India ranks the best on the criteria termed the Complexity Opportunity Index (COI), which measures how easy it is to redeploy existing knowhow to enter new complex products. 
India's existing capabilities have not only diversified its exports, but also allow for easy redeployment into related products that depend on those capabilities, making further diversification relatively easy. China is projected to grow at 4.9 per cent annually to 2026, the US three per cent and France 3.5 per cent. 

The top ranking in COI means India has many "unrealised opportunities" to diversify into related, high-value sectors to continue to drive productivity growth and job creation. Up to now, that potential remains unrealized, however, as India's complexity has not changed over the past decade. The rapid growth that is predicted is effectively capitalizing on previous gains in complexity.

It stressed that ensuring the long-run potential of India's economic growth will rely on realizing diversification into related products. The other major challenge will be to ensure the inclusive nature of this productive transformation, as the gains made in new chemical, vehicle and electronics exports are highly concentrated in specific localities of the subcontinent. "Whether that knowhow can be disseminated into new areas of India will in part determine whether rapid growth can be sustained in the long-term," it said.    

"Others like India, Turkey, and the Philippines have successfully added productive capabilities to enter new sectors and will drive growth over the coming decade," said Sebastian Bustos, a lead CID researcher in trade and economic complexity methods.  

Economic Survey 2017-18

The Economic Survey 2017-18, was tabled in the Parliament on January 29, 2018, by Arun Jaitley, Union Minister for Finance, Government of India. The Survey forecasts a growth rate of 7 to 7.5 per cent for FY19, as compared to the expected growth rate of 6.75 per cent in FY18. Focus on private investments and exports, two truly sustainable engines of economic growth, will be crucial in improving the climate for rapid economic growth.

Key Highlights:
Fiscal Deficit:
•    Central Government is confident of achieving fiscal deficit of 3.2 per cent of GDP for 2017-18.
•    The fiscal deficit during April-November 2017 has reached 112 per cent of budgeted expenditure as compared to 85.8 per cent during the corresponding period last year.
•    Revenue and fiscal deficits of states as a percentage of corresponding budget estimates is lower in the current year as compared to the previous year.

GDP Growth:
•    GDP growth expected to be between 6.5 and 6.75 per cent in 2017-18.
•    Real GDP growth expected at 6.5 per cent in 2017-18
•    GVA growth at basic prices is expected to be 6.1 per cent in 2017-18

Inflation and monetary policy:
•    Average retail inflation, measured by Consumer Price Index (CPI), in 2017-18 (April – December) seen at 3.3 per cent.
•    Average Wholesale Price Index (WPI) inflation, in 2017-18 (April – December) seen at 2.9 per cent from 1.7 per cent in 2016-17.
•    The Reserve Bank of India (RBI) has cut the repo rate by 25 basis points to 6.0 per cent in August 2017.

External Sector:
•    The current account deficit has declined to reach about 1.8 per cent of GDP in the first half of FY2018.
•    During April-December 2017, trade deficit increased by 46.4 per cent over corresponding period of previous year.
•    During April-December 2017, exports grew 12.1 per cent to US$ 223.5 billion, while imports increased by 21.8 per cent to US$ 338.4 billion.
•    Private transfer receipts, most of which is composed of remittances from Indians working abroad, increased by 10 per cent to US$ 33.5 billion in first half of 2017-18.

Performance of key sectors:
Agriculture and food management:
•    The growth rate in Gross Value Added (GVA) by the agriculture and allied sectors is estimated to be 4.9 per cent for 2016-17, as per provisional estimates.
•    The production of Kharif food-grains during 2017-18 is estimated at 134.7 million tonnes compared to 138.5 million tonnes in 2016-17.
•    The area sown under rabi crops during 2017-18 has reached 61.78 million hectares as of January 19, 2018.
•    Around 840,000 hectares of land was brought under micro-irrigation during 2016-17.
•    Coverage of non-loanee farmers under the Pradhan Mantri Fasal Bima Yojana (PMFBY) increased 123.5 per cent in 2016-17 and the scheme is being implemented in 25 states/UTs in 2017. The scheme covers farmers from pre-sowing to post harvest against natural non-preventable risks.

Industries, corporate and infrastructure sector:
•    Growth rate in the Gross Value Added (GVA) by the industrial sector was 5.6 per cent in 2016-17 and 5.8 per cent in the second quarter of 2017-18.
•    During April-November 2017, the Index of Industrial Production (IIP) grew 3.2 per cent, while registering a growth rate of 8.4 per cent in November 2017, the highest in 25 months.
•    The eight core infrastructure supportive industries, viz. coal, crude oil, natural gas, refinery products, fertilizers, steel, cement and electricity that have a total weight of nearly 40 per cent in the IIP, registered a cumulative growth of 3.9 per cent during April-November 2017.
•    The performance of corporate sector highlighted that the growth in sales of more than 1700 non-government non-financial (NGNF) listed manufacturing companies was 9.5 per cent in Q2 2017-18 compared to 3.7 per cent in Q2 2016-17.
•    As of September 2017, India had 115,530 km of national highways, 176,166 km of state highways and 53,26,166 km of other roads. Under the new umbrella program ‘Bharatmala Pariyojana’ the government is aiming holistic development of highways in the country.
Services sector:
•    The services sector is projected to grow at 8.3 per cent in 2017-18, as against 7.7 per cent in 2016-17.
•    As per World Trade Organisation (WTO) data, India’s share in the exports of commercial services in the world increased to 3.4 per cent in 2016 from 3.3 per cent in 2015.
•    In terms of growth in tourism sector, between January-December 2017, Foreign Tourist Arrivals (FTAs) were 10.2 million with a growth of 15.6 per cent and foreign exchange earnings (FEE) were at US$ 27.7 billion with a growth of 20.8 per cent.

Public Finance:
•    The growth in non-debt receipts at 4.58 per cent during April-November 2017 as against the growth rate of 25.8 per cent in the previous year.
•    The realisation of the gross tax revenue during April-November 2017 as ratio of the budget estimates for 2017-18 was 56.9 per cent compared to 57.2 per cent in the corresponding period of the previous year.

Ease of Doing Business in India:
•    Various reforms taken by the Government of India have led to increase in India’s ranking in the World Bank’s Ease of Doing Business Index from 130 in 2017 to 100 in 2018.
•    India’s ranking in the taxation and insolvency parameters improved by 53 and 33 spots, respectively, on the back of administrative reforms undertaken by the Government of India in the areas of taxation and passage of Insolvency and Bankruptcy Code (IBC), 2016.
•    To improve the ease of doing business in the country, the government has taken various initiatives to improve contract enforcement. Over 1,000 redundant legislations have been scrapped.
•    The Commercial Courts, Commercial Division and Commercial Appellate Division of High Courts Act, 2015 have been passed while intra-government litigation has been reduced.
•    The National Judicial Data Grid (NJDG) is being expanded under which every high court in the country will be digitized very soon. The same was recognized in the rankings by the World Bank.

GST data and the Indian Economy:
•    The number of indirect taxpayers in the country witnessed growth of 50 per cent to 9.8 million unique GST registrants, as of December 2017.
•    India’s internal trade in goods and services (excluding non-GST goods and services) at 60 per cent is even higher than that estimated in last year’s economic survey.
•    The current GST tax base (excluding exports) is around 6.5 to 7 million, broadly similar to the estimates of Revenue Neutral Rate Committee and GST Council.
•    Based on the average collections from GST, the implied weighted average collection rate (incidence) is 15.6 per cent. This is similar to the estimate of 15-16 per cent made by the RNR committee.
•    Non-agricultural workforce in the formal sector in India is considerably greater than previously held beliefs about the size of formal sector non-farm payroll. Estimates, on the basis of enterprise-based definition of employment, imply that nearly 53 per cent of non-agricultural workforce is in the formal sector.

Changing face of Science, Research and Technology in India
•    Public expenditure on R&D as a percentage of GDP has remained constant between 0.6-0.7 per cent over the past two decades; however in value terms, the gross expenditure on R&D has increased at a CAGR of 13.03 per cent from Rs 24,117 crore (US$ 3.8 billion) in 2004-05 to Rs 104,864 crore (US$ 16.5 billion) in 2016-17.
•    The number of students enrolled in PhD programs in India has increased over the years, with 126,451 PhD enrolments in 2015-16, backed by concerted efforts by the Government of India such as increase in the number and quantum of fellowships like the Prime Minister Research Fellowships at the IITs.
•    The number of annual publications in India grew 14 per cent between 2009-14, which increased India’s share in global publications from 3.1 per cent in 2009 to 4.4 per cent in 2014.
•    India was ranked 13 in 2017 by Nature Index, which publishes tables based on counts of high-quality research outputs based on natural sciences in the previous year.
•    As per WIPO, India’s Patent Filing Office is the 7th largest in the world with 45,658 registered patents as of 2015.
•    About 200,000 patents were pending for examination as there were only 132 patent examiners as of 2016-17; however the government has hired 450 patent examiners and created an expedited filing system for Indian residents in 2017, which will improve the existing patent system.
•    In order to encourage investigator-led research, the Science and Engineering research Board (SERB) was established in 2008, which has sanctioned nearly 3,500 new R&D projects to individual scientists so far.
•    India can become a global leader outright in various areas with willingness to invest and focus on key areas. For this purpose, the government has chosen few missions for their strategic importance and potential for societal impact such as National Mission on Dark Matter, National Mission on Genomics, National Mission on Energy Storage Systems, National Mission on Mathematics, National Mission on Cyber Physical Systems, and National Mission on Agriculture.

 

India Economy Data

 

2012

2013

2014

2015

2016

Population (million)

1,243

1,259

1,276

1,292

1,309

GDP per capita (USD)

1,465

1,477

1,597

1,611

1,729

GDP (USD bn)

1,821

1,860

2,038

2,082

2,264

Economic Growth (GDP, annual variation in %)

5.5

6.5

7.2

8.0

7.1

Consumption (annual variation in %)

5.3

7.4

6.8

6.1

8.7

Investment (annual variation in %)

4.8

1.8

4.1

6.6

2.4

Industrial Production (annual variation in %)

1.1

-0.1

2.8

3.4

5.0

Public Debt (% of GDP)

69.1

68.5

68.6

69.6

69.5

Money (annual variation in %)

7.5

12.3

10.7

11.5

6.3

Inflation Rate (CPI, annual variation in %, eop)

10.5

8.2

5.3

4.8

3.9

Inflation Rate (CPI, annual variation in %)

10.2

10.0

5.9

4.9

4.5

Inflation (PPI, annual variation in %)

7.4

6.0

2.0

-3.6

1.8

Policy Interest Rate (%)

7.50

8.00

7.50

6.75

6.25

Stock Market (annual variation in %)

8.2

18.9

24.9

-9.4

16.9

Exchange Rate (vs USD)

54.28

60.02

62.29

66.25

64.86

Exchange Rate (vs USD, aop)

54.37

60.42

61.14

65.42

67.04

Current Account (% of GDP)

-4.8

-1.8

-1.4

-1.1

-0.7

Current Account Balance (USD bn)

-87.4

-32.8

-27.6

-22.1

-15.2

Trade Balance (USD billion)

-189.5

-136.6

-137.5

-117.8

-105.7

Exports (USD billion)

300

314

311

262

275

Imports (USD billion)

490

451

448

380

380

Exports (annual variation in %)

-1.9

4.6

-1.2

-15.7

4.9

Imports (annual variation in %)

0.1

-8.0

-0.6

-15.3

0.2

 

Overview

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

 

GDP Growth Rate

1.80

1.7

1.6

1.4

1.5

1.3

percent

Unemployment Rate

3.46

4.8

4.8

4.8

4.8

4.6

percent

Inflation Rate

4.44

5.1

5.1

5.5

4.7

4.8

percent

Interest Rate

6.00

6

6

6

5.75

4.75

percent

Balance of Trade

-11979.21

-14500

-16200

-14300

-14900

-11100

USD Million

Government Debt to GDP

69.50

69.2

69.2

69.2

69.2

70

percent

 

 

 

 

 

 

 

 

MARKETS

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Currency

65.18
 

64.09

64.69

65.3

65.91

68.42

Stock Market

32968.68
points

34044

33292

32557

31837

26625

Government Bond 10Y

7.40
percent

7.76

7.97

8.18

8.4

9.33

 

 

 

 

 

 

 

GDP

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

GDP Growth Rate

1.80
percent

1.7

1.6

1.4

1.5

1.3

GDP Annual Growth Rate

7.20
percent

7

7.3

7.4

7.2

5.7

GDP

2263.79
USD Billion

2500

2500

2500

2500

3100

GDP Constant Prices

32495.60
INR Billion

34500

33180

34300

35600

40100

Gross National Product

12865461.00
INR Tens Of Million

12865461

12865461

12865461

12865461

12865461

Gross Fixed Capital Formation

10519.30
INR Billion

10006

9876

9843

9832

11000

GDP per capita

1861.50
USD

2500

2500

2500

2500

3500

GDP per capita PPP

6092.60
USD

6500

6500

6500

6500

7000

GDP From Agriculture

5722.27
INR Billion

3138

4926

3689

4275

4130

GDP From Construction

2379.51
INR Billion

2153

2349

2179

2297

2530

GDP From Manufacturing

5247.83
INR Billion

5247

5248

5248

5248

4620

GDP From Mining

880.10
INR Billion

912

911

911

952

925

GDP From Public Administration

3994.68
INR Billion

3816

3781

3775

3773

3773

GDP From Utilities

641.71
INR Billion

648

645

646

630

713

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LABOUR

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Unemployment Rate

3.46
percent

4.8

4.8

4.8

4.8

4.6

Employed Persons

29650.00
Thousand

30737

30737

30737

30737

32200

Unemployed Persons

44.85
Million

41.7

41.7

41.7

41.7

40.33

Labor Force Participation Rate

52.50
percent

53.54

53.54

53.54

53.54

55.32

Population

1299.00
Million

1320

1320

1320

1320

1340

Retirement Age Women

60.00
 

60

60

60

60

60

Retirement Age Men

60.00
 

60

60

60

60

60

Living Wage Family

17400.00
INR/Month

18500

18500

18500

18500

19800

Living Wage Individual

11000.00
INR/Month

14000

14000

14000

14000

18000

Wages

272.19
INR/Day

330

330

330

330

360

Wages High Skilled

44000.00
INR/Month

65500

65500

65500

65500

46500

Wages In Manufacturing

347.30
INR/Day

450

450

450

450

500

Wages Low Skilled

10300.00
INR/Month

16000

16000

16000

16000

18000

Youth Unemployment Rate

12.90
percent

15.2

15.2

15.2

15.2

13.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PRICES

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Inflation Rate

4.44
percent

5.1

5.1

5.5

4.7

4.8

Consumer Price Index CPI

136.40
Index Points

138

139

143

144

158

GDP Deflator

128.80
Index Points

130

130

130

130

145

Producer Prices

115.80
Index Points

116

116

118

119

131

Producer Prices Change

2.48
percent

2.6

3

3.2

2.9

5.9

Export Prices

372.00
Index Points

381

381

381

381

399

Import Prices

518.00
Index Points

520

520

520

520

510

Food Inflation

3.26
percent

3.5

4.3

4

4.2

4.7

CPI Transportation

120.20
Index Points

125

128

130

133

151

Inflation Rate Mom

-0.40
percent

0.5

0.1

0.58

0.2

0.32

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

MONEY

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Interest Rate

6.00
percent

6

6

6

5.75

4.75

Cash Reserve Ratio

4.00
percent

4

4

4

4

4

Interbank Rate

6.15
percent

6.32

6.4

6.3

6.3

5.5

Money Supply M1

29203.50
INR Billion

28733

28315

28095

27861

27851

Money Supply M2

31201.67
INR Billion

30871

32654

32293

30863

28517

Money Supply M3

136775.74
INR Billion

135979

139593

141145

134702

126972

Central Bank Balance Sheet

17014.09
INR Billions

17069

17348

17510

17597

17596

Foreign Exchange Reserves

421330.00
USD Million

421128

416165

411604

408098

397173

Loan Growth

11.50
percent

10.82

11.71

10.41

8.5

7

Reverse Repo Rate

5.75
percent

5.75

5.75

5.75

5.5

5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

TRADE

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Balance of Trade

-11979.21
USD Million

-14500

-16200

-14300

-14900

-11100

Exports

25834.36
USD Million

24700

24600

25000

24500

28900

Imports

37813.57
USD Million

39200

40800

39300

39400

40000

Current Account

-13465.11
USD Million

-7100

-15000

-7344

-4100

-2460

Current Account to GDP

-0.70
percent

-1.3

-1.3

-1.3

-1.3

-1.2

External Debt

513438.00
USD Million

509000

514000

517000

519000

517000

Terms of Trade

71.80
Index Points

73

73

73

73

78

Capital Flows

33.39
USD Million

-11.42

14.56

-0.5

5.38

5.03

Foreign Direct Investment

1921.00
USD Million

1763

3336

2511

2794

2786

Remittances

11623.76
USD Million

11185

10939

10802

10636

10627

Tourist Arrivals

1053000.00
 

974700

766100

834100

904200

762000

Gold Reserves

558.10
Tonnes

555

552

549

546

525

Crude Oil Production

720.00
BBL/D/1K

728

731

732

732

732

Terrorism Index

7.53
 

7.63

7.63

7.63

7.63

7.72

Weapons Sales

56.00
USD Million

56

56

56

56

56

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

GOVERNMENT

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Government Debt to GDP

69.50
percent

69.2

69.2

69.2

69.2

70

Government Budget

-3.50
percent of GDP

-3.4

-3.4

-3.4

-3.4

-3

Government Budget Value

-7156.99
INR Billion

-6393

-6213

-5000

-2131

-1932

Government Spending

3228.15
INR Billion

3586

3405

3497

3320

3520

Government Revenues

12834.72
INR Billion

7387

3710

2707

2712

2711

Fiscal Expenditure

19991.71
INR Billion

13780

9923

7707

4842

4643

Military Expenditure

55630.70
USD Million

58836

58836

58836

58836

58902

 

 

 

 

 

 

 

 

 

 

 

 

 

BUSINESS

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Business Confidence

59.70 Index Points

56.8

55.9

56.5

57

59

Manufacturing PMI

52.10
 

52.8

51.5

51.8

52.1

51.2

Services PMI

47.80 Index Points

51.9

52

51

52.1

51.9

Industrial Production

7.50 percent

3.2

2.9

3.9

4.1

6.5

Industrial Production Mom

1.50 percent

1.73

0.8

0.88

0.7

0.87

Manufacturing Production

8.70
percent

3.5

3.4

2.27

4.1

5.6

Changes in Inventories

228.82
INR Billion

381

332

348

344

344

Car Production

255196.00
Units

248342

241700

247522

245408

244087

Car Registrations

242411.00
 

263491

238308

254220

245086

247519

Internet Speed

6492.06
KBps

8654

9079

10309

11613

12592

IP Addresses

9378846.00
IP

9274399

9221603

9152764

9095799

8729667

Mining Production

0.10
percent

3.9

5.9

2.5

2.8

2.1

Steel Production

9028.00
Thousand Tonnes

9103

8450

8255

8581

8567

Cement Production

27151.00
Thousands of Tonnes

24335

22219

24720

23837

24351

Competitiveness Index

4.59
Points

4.61

4.61

4.61

4.61

5.51

Competitiveness Rank

40.00
 

44

44

44

44

51

Composite Pmi

49.70
 

53

51.4

50.73

53

51.6

Corruption Index

40.00
Points

40

40

40

40

42

Corruption Rank

81.00
 

81

81

81

74

72

Ease of Doing Business

100.00
 

128

128

128

128

126

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONSUMER

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Consumer Confidence

97.00
Index Points

139

137

130

133

133

Consumer Spending

19190.11
INR Billion

17950

18200

18500

19100

22000

Disposable Personal Income

169623970.00
INR Million

169623970

169623970

169623970

169623970

231000000

Personal Savings

26099.21
INR Billion

29077

29077

29077

29077

30171

Bank Lending Rate

9.45
percent

9.6

9.6

9.6

9.6

7.5

Households Debt To Gdp

11.10
percent of GDP

10.87

10.7

10.8

10.74

10.76

Gasoline Prices

1.10
USD/Liter

1.1

1.07

1.07

1.06

0.92

 

 

 

 

 

 

 

 

 

 

 

 

 

HOUSING

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Housing Index

138.00
Index Points

146

148

150

154

175

Construction Output

6.70
percent

3.9

3.3

2.2

4.5

3

 

 

 

 

 

 

TAXES

Actual

Q1/18

Q2/18

Q3/18

Q4/18

2020

Corporate Tax Rate

34.61
percent

34.61

34.61

34.61

34.61

25

Personal Income Tax Rate

35.54
percent

35.54

35.54

35.54

35.54

35.54

Sales Tax Rate

18.00
percent

18

18

18

18

18

Social Security Rate

24.00
percent

24

24

24

24

24

Social Security Rate For Companies

12.00
percent

12

12

12

12

12

Social Security Rate For Employees

12.00
percent

12

12

12

12

12

 

 

 

 

 

 

 

 

 

 

 

Global economy

The IMF is, however, more bullish about the global economy and has scaled up its forecast for world output to 3.9 per cent each in 2018 and 2019, which is 0.2 percentage points higher than its estimate in October.

For 2017, it has raised its estimate for global growth by 0.1 percentage points to 3.7 per cent.

“The revision reflects increased global growth momentum and the expected impact of the recently-approved US tax policy changes,” it said.

It has significantly raised the growth forecast for the US to 2.3 per cent in 2017, 2.7 per cent in 2018 and 2.5 per cent next year.

 

India's way to $1 trillion digital economy 
 

Digital is fast engulfing our lives. Users are consuming more of it, using an average of 4 GB of data a month on everything from entertainment to shopping. New users, all on smartphones, start using mobile internet with free services like email and regional language content, and “within weeks leapfrog to ecommerce and digital payments. There will be 600 million Indians with smartphones in five to seven years, each consuming content and transacting digitally. 

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That creates immense opportunities across the lives of those individuals and impacts nearly all industries they interact with, including financial services, retail, media, travel & hospitality and healthcare. 


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“In the next five years, India is really going to be a continuous story about user growth. And as India’s internet user base matures, there will be a significant impact on every vertical”, says Rajan Anandan, vice-president-South East Asia & India, Google. Poor bandwidth & technology could eclipse this the growth. A snapshot of the digital economy that is expected to balloon. 


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All-round Growth 

  • 500 millionn users will consume online videos by 2020
  • Fourth largest category will be online news, reaching 280 million users by 2020 from 106 million users today
  • 50% of internet users will pay digitally by 2020 
     

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Challenges to Digital Economy Growth

  • Slow roll-out of Wi-Fi hotspots
  • Most small & medium enterprises still not online & slow to adopt technology
  • Entry-level smartphones have limited capabilities to allow smooth internet access
  • Not enough skilled manpower in digital technologies

Lack of user education 
(Data sources: Ministry of Electronics & IT, IAMAI, Google-BCG report, FICCI-EY report)