New Delhi, May 24 (FN Bureau) A host of key high-frequency indicators such as monthly GST collections, e-way bills, electronic toll collections and sale of vehicles show growing strength of Indian economy and point to continuing growth momentum in the April-June quarter (Q1) of the current financial year 2024-25, as per the latest edition of monthly economic review released by Finance Ministry on Friday. The report noted that the Indian economy closed FY24 strongly with its growth surpassing market expectations despite strong external headwinds. “Industrial activity is gaining momentum. This is clear from improving industrial capacity utilisation and volume indicators like the Index of Industrial Production and Purchasing Managers’ Index (PMI) for manufacturing.
Concurrently, fixed investment is gathering pace on the back of the focus of the Government on capital spending and the resultant crowding in of private investment,” said the Monthly Economic Review for the month of April 2024. The report said that job market trends are reassuring while noting that urban unemployment rate declined year-on-year during the quarter ending March 2024. It further said that labour force participation rate and worker-to-population ratio have improved. “Formal jobs are rising, as indicated by the growing net payroll additions under the Employee Provident Fund Organisation,” it said. The report said that along with growth and employment, the other macroeconomic indicators are also improving. “Retail inflation clocked 4.83 percent in April 2024, the lowest in the past 11 months. On the external front, despite global challenges, India’s foreign exchange reserves are comfortable, and the Indian rupee has been one of the most resilient vis-à-vis the US dollar in recent months,” the report said.
The report said that domestic economic activity remained buoyant in FY24, and the momentum has continued in FY25. As per the official data, goods and services tax (GST) collection jumped to a high of Rs 2.1 lakh crore in April 2024 on the back of increase in domestic transactions and imports. “India’s merchandise exports in FY25 began on a positive note, recording a growth of 1.08% year-on-year in April 2024. This comes amid marginally improved economic activity and consumer sentiment in Europe and a steady US economy,” the FinMin report said. The report stated that the crux of the foregoing discussion is that the industrial and service sectors of the Indian economy are performing well, backed by brisk domestic demand and partially by tentative external demand. “Domestic manufacturing will likely receive stronger external support in the upcoming months,” it said.