The PHDCCI Economic and Business Momentum (EBM) Index

No. PR- 279

March 22, 2021

New Delhi

The PHDCCI Economic and Business Momentum (EBM) Index

Economic activity at pre-COVID levels, Q4 FY 2020-21 GDP growth seen at more than 1%: PHD Chamber

With sharp recovery in the key economic and business indicators in the recent months, the economy is returning to the pre-COVID levels, said Mr. Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry in a press statement issued here today.

PHDCCI Economic & Business Momentum (EBM) Index of the 25 lead economic and business indicators has improved to the level of 99.7 in January 2021 as compared to 99.2 in December 2020, said Mr Sanjay Aggarwal.

On the basis of recent movement of PHDCCI EBM Index, PHD Chamber projects more than 1% growth rate of GDP in Q4 FY 2020-21, said Mr Sanjay Aggarwal.

GDP growth rate at 0.4% for Q3 FY 2020-21 has been very much in line with our projections in the PHDCCI Economic and Business Momentum (EBM) Index released on February 22, 2021, in which we had estimated that the GDP growth will be at around 0.1% to 1% in Q3 FY 2020-21, said Mr Sanjay Aggarwal.

Chart-1 : PHDCCI EBM Index: Monthly Trend (Base: 2018-19=100) Chart-2 : PHDCCI EBM Index (Base: 2018-19=100) and GDP Growth Rates (in %): Quarterly Trend

Source: PHD Research Bureau, PHDCCI EBM Index; GDP growth figures compiled from MOSPI

Note: GDP growth figure for Q4 FY 2020-21 is projection based on PHDCCI EBM Index

Lead economic and business indicators such as cement, steel, consumer durables, capital goods, GST collections, external commercial borrowings and FDI equity inflows have shown a marvelous improvement in the recent months, said Mr. Sanjay Aggarwal.

PHDCCI EBM (Economic and Business Momentum) Index has shown steady recovery from the lows of 78.3 in April 2020 to 85.7 in May 2020, 91.6 in June 2020, 95.5 in July 2020, 95.9 in August 2020, 96.5 in September 2020, 96.8 in October 2020, 98.4 in November 2020, 99.2 in December 2020 and 99.7 in January 2021, with a base of 2018-19=100, said Mr. Aggarwal.

The 25 indicators composite EBM Index of the January 2021 at 99.7 is very near the level of 100.3 in January 2020, he said

However, the EBM index during the period April –January of FY 2020-21 stands at 93.8 as compared with April –January FY 2019-2020 at 99.6, said Mr. Aggarwal.

PHDCCI EBM Index is a composite index of 25 lead economic and business indicators with base year at 2018-19=100, which considers the demand and supply parameters to present a broad perspective of the economy. Out of the 25 lead economic and business indicators, 21 have shown a remarkable improvement in January 2021 from their lows of April 2020, said Mr. Sanjay Aggarwal.

The growth trend of PHDCCI EBM Index suggests that economy has potential to accelerate a growth rate of 11% in the next financial year 2021-22 on the back of various effective and meaningful reforms undertaken by the Government, said Mr. Sanjay Aggarwal.

At this juncture, immediate policy attention is required towards credit access to industry and services sectors. Credit disbursement should be at the top priority at this juncture by the banking sector, he said.

The focus should be on ensuring provision of hassle free disbursements of loans vis-à-vis enhanced liquidity for MSMEs, especially in rural sectors, said Mr Sanjay Aggarwal.

Going ahead, demand creation will have a multiplier effect on enhanced production possibilities, expansion of employment in factories, expansion of capital investments and overall virtuous circle of growth and development of Indian economy.

The increased spending on infrastructure will give a multiplier effect to rejuvenate the aggregate demand in the economy and to mitigate the daunting impact of COVID-19 on the economy. Undoubtedly, robust growth of infrastructure is the key ingredient to realize the vision of Aatmanirbhar Bharat, said Mr Sanjay Aggarwal.

Also, there is a need to lower interest rates for consumers and businesses, lesser compliances for MSMEs vis-à-vis ease of doing business at the ground level and a lower tax regime to increase the personal disposable income of the people, said Shri Sanjay Aggarwal.

PHDCCI EBMI (Economic and Business Momentum Index) is a composite index of lead economic and business indicators including IIP Consumer durable goods, IIP Consumer non-durable goods, IIP Capital Goods, IIP Intermediate Goods, Coal, Crude Oil, Natural Gas, Petroleum Refinery Products, Fertilisers, Steel, Cement, Electricity, Consumption of Petroleum products, Export Merchandise, Export Services, India Freight Traffic, Credit to Agriculture, Credit to Industry, Credit to service sector, Personal Loans, GST Collections, SENSEX, FDI Equity Inflows, External commercial borrowings and Unemployment.

Full PHDCCI EBM Index report attached




Base: 2018-19=100

Sr No Economic Indicators April 2020 January 2021 Improvement (January ’21 – Apr’20)
1 IIP Consumer durable goods 5 106 101
2 IIP Consumer non-durable goods 64 106 42
3 IIP Capital Goods 8 94 86
4 IIP Intermediate Goods 39 119 80
5 Coal 97 112 15
6 Crude Oil 86 84 (-)2
7 Natural Gas 86 94 8
8 Petroleum Refinery Products 81 107 26
9 Fertilisers 101 112 10
10 Steel 22 112 90
11 Cement 17 131 114
12 Electricity 88 118 30
13 Consumption of Petroleum products 61 111 53
14 Export Merchandise 50 123 73
15 Export Services 121 125 4
16 India Freight Traffic 98 107 9
17 Credit to Agriculture 104 110 6
18 Credit to Industry 102 99 (-)3
19 Credit to service sector 111 108 (-)3
20 Personal Loans 112 109 (-)3
21 GST Collections 32 120 88
22 SENSEX 112 176 64
23 FDI Equity Inflows 74 192 118
24 External commercial borrowings 54 204 149
25 Unemployment 84 98 13
Composite Weighted Index 78 100 21

Source: PHD Research Bureau, PHDCCI EBM Index

Note: For calculation purpose, the January 2021 FDI figures are estimated on the basis of available data of last 3 months; figures and difference are rounded off


Media Division

PHD Chamber of Commerce and Industry