The uptick in sales of commercial vehicles reflects the growth in economic activity in the country

Analyzing the recently released data on growth in various economic sectors in India, it is noted that India continues to be the fastest growing economy in the world. India’s GDP has registered a growth of 7.8 percent in the April-June 2023 quarter. Whereas China has registered an increase of 6.3 percent, Indonesia 5.2 percent, Russia 4.9 percent, America 2.1 percent, Japan 2 percent, South Korea 0.9 percent, Britain 0.4 percent and Germany 0.2 percent.

India’s services sector continues to show strong growth, maintaining its share in India’s GDP above 60 percent. In the April-June 2023 quarter also, the growth rate in the service sector has been 10.3 percent. This includes a 12.2 percent growth rate in sectors such as the financial sector, real estate, and professional services. Similarly, a growth of 9.2 percent has been recorded in services related to trade, hotel, transport, communication and broadcasting. The growth rate in agriculture sector has been 3.5 percent. The construction sector had a 16 percent growth rate in the first quarter of the financial year 2022-23, which has come down to 7.9 percent in the first quarter of the financial year 2023-24. The fastest growing sectors in India in the first quarter of the financial year 2023-24 are – Financial Services and Real Estate 12.2 percent, Trade, Hotel and Transport 9.2 percent, Public Administration and Defense 7.9 percent, Construction 7.9 percent, Mining 5.8 percent and manufacturing 4.7 percent. There is still a need to take more steps to increase the rate of growth in the manufacturing sector.

Exports of products from India have shown a decrease for the 6th consecutive month. In the month of July 2023 also a decrease of 15.9 percent has been observed in the export of products. Out of 30 main products being exported from India, there has been a decrease in the export of 19 products. In the April-June 2023 quarter as well, exports across various products have remained low. Due to the problems arising in the economies of various countries at the global level, exports of products from India are decreasing. Until the economic condition of these countries does not improve, there is little chance of improvement in the export of these products from India.

Secondly, Monsoon activities have been very weak in the month of August 2023 over India. Monsoon rainfall in the month of August 2023 has been 35 percent less than the long period average, which is the lowest monsoon rainfall in the month of August in almost a century. Overall, monsoon rainfall over the country is likely to be 3 to 18 per cent below normal. Deficit monsoon rains will have a direct impact on the agriculture sector of the country. The Kharif crop has been affected to some extent. Due to less rainfall in the country, the storage of water is also showing adverse effect. Water scarcity may be felt in some parts of the country in the coming times, due to which the rabi crop may also be adversely affected. However, according to a study conducted by the State Bank of India, the areas of India where food grains are produced, there may not be much deficit of monsoon rains till the end of the monsoon season. Therefore, in the financial year 2023-24, the production in the agriculture sector will be much less as compared to the previous year, it is not even necessary.

Tremendous increase in capital expenditure has been registered by the Central Government and some State Governments. Along with this, due to improvement in profitability of many companies, these companies have also increased their capital expenditure. Thus, many companies in the public and private sector have now entered the cycle of capital expenditure, which can accelerate the economic development of the country in the coming times. The tourism sector was greatly affected due to the Corona epidemic, but this year there has been a tremendous boom in the tourism sector. Due to this, incomparable activities have been visible in tourism related areas like hotel, transport, retail trade etc. These activities are expected to gain more momentum in the coming times.

Even after the first quarter (April-June 2023) of the financial year 2023-24, the development activities in various economic sectors of India remain fast. This gives an impression that the growth rate in the country will be able to remain at a high level even in the remaining period of the financial year 2023-24. Good growth rate in India’s manufacturing sector has continued in the month of August 2023. The S&P Global Purchasing Managers’ Index (PMI) has reached a three-month high of 58.6. This index has become possible due to the new orders being received by the manufacturing units and the increasing production in these units. This also means that the possibilities of continuing the growth in the manufacturing sector have increased in the times to come.

The growth rate during the month of July 2023 has been 8 percent in the 8 basic industry sectors of India, it was the highest level of 8.3 percent in the month of June 2023, the last 5 months. Whereas in the month of July 2022, this growth rate was 4.8 percent. The above 8 basic industry sectors include coal industry, steel industry, natural gas, cement industry, power generation, refinery products, fertilizer industry and crude oil production. An increase in the production of all these 8 basic industries has been recorded in the month of July 2023. The cumulative growth rate during the period April-July 2023 has been 6.4 per cent.

There has been an incomparable increase in the sale of four wheelers (including commercial vehicles) in the month of August 2023. Maruti Suzuki Company’s four wheeler sales have increased by 14.48 percent to 1.89 lakh vehicles. Mahindra Company’s vehicle sales have increased by 19 percent, while Eicher Motor Company’s vehicle sales have increased by 10.66 percent to 77,583. Similarly, the sales of commercial vehicles of Ashok Leyland Company have increased by 10.30 percent to reach the level of 15,576. Commercial vehicles also include truck sales. If there is a boom in the sale of commercial vehicles in India, it means that business activities in the country are increasing at a rapid pace due to which there is a need to transport products from one corner of the country to another and ultimately Sales of commercial vehicles like trucks etc. are also increasing.

Goods and Services Tax collection in the month of August 2023 has also been Rs 159,069 crore, registering an increase of 11 percent. Rs 187,035 crore was collected in April 2023, Rs 157,090 crore in May 2023, Rs 161,497 crore in June 2023, Rs 165,105 crore in July 2023 and Rs 143,612 crore in August 2022.

The number of financial transactions on the UPI platform has crossed the 1000 crore mark in August 2023. This behavior in August 2023 has been 61 percent more than the behavior during the same period last year. These financial transactions were worth 996 crores in the month of July 2023 and 934 crores in the month of June 2023. This financial transaction was of Rs 15.76 lakh crore in the month of August, while it was Rs 15.34 lakh crore in the month of July 2023 and Rs 14.75 lakh crore in the month of June 2023. There has been a 47 percent increase in the amount of these transactions done in the month of August 2023 as compared to the amount of transactions done in the same month last year.

It is a matter of pride for all of us Indians that RBI Governor Shaktikanta Das has been awarded A+ rating by ‘Global Finance Central Banker Report Card 2023’. Shaktikanta Das has been given the first ranking among the governors of central banks of all countries across the world. However, the governors of two other countries, Mr. Thomas Jordan, Governor of the Central Bank of Switzerland and Mr. Nguyen Thi Hang, Governor of the Central Bank of Vietnam have also received A+ rating. The decisions taken from time to time by the Reserve Bank of India to control inflation in the country and especially to strengthen the financial condition of public sector banks have also been highly praised.

– Prahlad Sabnani

retired deputy general manager

state Bank of India