Economic activity significantly higher than pre-COVID levels: PHD Chamber

No. PR – 159

December 4, 2021

New Delhi  

PHDCCI Economy GPS Index for November 2021

Economic activity significantly higher than pre-COVID levels: PHD Chamber

According to the PHDCCI Economy GPS Index, the current economic activity has significantly surpassed the pre-COVID levels; the GPS Index for the month of November 2021 at 128.8 is 25.1 basis points higher than the 3 months (December 2019, January 2020 and February 2020) average of pre-COVID level of 103.8, said the Industry Body, PHD Chamber of Commerce and Industry, in a press statement issued here today.

Effective economic reforms along with the rapid vaccination drive in the country have significantly improved the consumer and business sentiments, said Mr. Pradeep Multani, President, PHD Chamber of Commerce and Industry.

PHDCCI Economy GPS Index captures the momentum in supply side business activity through growth in GST collections, demand side consumer behaviour through volume growth in passenger vehicle sales and sensitivity of policy reforms and impact of domestic and international economic and business environment through the movement of SENSEX, said the Industry Body. 

Sequentially, the PHDCCI Economy GPS Index for November 2021 has increased to 128.8 as compared to 127 for October 2021 (Base year 2018-19 = 100). Passenger vehicles recorded a sequential growth of 8.7%, increasing from 2,26,353 units in October 2021 to 2,46,000 units in November 2021.  The sequential growth of GST collections has been registered at 1.1% from Rs. 130,127 crore in October 2021 to Rs. 131,526 crore in November 2021. However, the sequential growth of SENSEX (average of daily close) has decreased by (-)1.7% in November 2021 from 60422 in October 2021 to 59416 in November 2021, said Mr. Pradeep Multani.

Economic recovery so far (Sequential)

 PHDCCI Economy GPS Index 2018-19=100 January 2021 February 2021 March 2021 April 2021 May 2021 June 2021 July 2021 August 2021 September 2021 October 2021 November 2021
121.7 122.0 122.9 124.3 91.5 107.5 119.7 116.7 113.1 127.0 128.8

Source: PHD Research Bureau, PHDCCI Economy GPS Index

The PHDCCI Economy GPS Index during the period April–November of FY 2021-22 stands at 116.1, which is 33.9 points higher than April–November FY 2020-2021 period index of 82.2, said Mr. Pradeep Multani.

The PHDCCI Economy GPS Index at 128.8 for November 2021 is higher by 22 points from the Economy GPS Index for November 2020 at 106.9, said Mr. Pradeep Multani.

Economic recovery so far (Y-o-Y)

PHDCCI Economy GPS Index 2018-19=100 November 2017 November 2018 November 2019 November 2020 November 2021
92.0 97.4 103.9 106.9 128.8

Source: PHD Research Bureau, PHDCCI Economy GPS Index

PHDCCI Economy GPS Index has shown sharp recovery from the lows of 39.6 for April 2020 to 124.3 for April 2021, 91.5 for May 2021 as compared with 50.1 for May 2020, 107.5 for June 2021 as compared with 75.1 for June 2020, 119.7 for July 2021 as compared with 85.6 for July 2020, 116.7 for August 2021 as compared with 90.5 for August 2020, 113.1 for September 2021 as compared with 100.2 for September 2020, 127.0 for October 2021 as compared with 109.6 for October 2020 and 128.8 for November 2021 as compared with 106.9 for November 2020.

Chart 1: GPS Index: Monthly Trend Chart 2: Movement of GDP and GPS over the quarters

Source: PHD Research Bureau, PHDCCI Economy GPS Index.

Though passenger vehicle sales have increased sequentially, however, shortages of raw material, high input prices, among others, are impacting the production possibilities and anticipated sales volumes. At this juncture, there is a need to address the high commodity prices and shortages of raw material to support the consumption and private investments in the country, said Mr Pradeep Multani.

The drivers of household consumption needs to be further strengthened to enhance the aggregate demand as it will have an accelerated effect on expansion of capital investments, said Mr Pradeep Multani.

More and more direct benefit transfers needs to be enhanced for the urban and rural poor under the various welfare schemes of the Government to strengthen and sustain the recovery in the economic growth, said Mr Pradeep Multani.

As the uncertainty about the third wave with new variants of COVID-19 is looming large, there must be more and more focus on ensuring the COVID appropriate behaviour among the people, said Mr Pradeep Multani.

Mitigation of the pandemic impact with effective adoption of COVID appropriate behaviour and protocols would further enhance the consumer and business sentiments and pave way for a higher growth trajectory, going forward, said Mr Pradeep Multani.

PHD Chamber of Commerce and Industry (PHDCCI) Economy GPS Index is a composite index of 3 lead economic and business indicators with base year at 2018-19=100, which measures the broad economic and business activity. The PHDCCI Economy GPS Index, based on the monthly values of three high frequency indicators viz., GST collection (Rs. Crore), Passenger Vehicle Sales (units) and SENSEX (daily average), helps to find the direction of the economy.  The three broad indicators are representing not only demand and supply in the economy but also revenue growth of the government and movement of financial markets in the country. GST collections indicate the momentum of business activity, passenger vehicle sales is broad indicator of demand activity in the economy and movement of SENSEX indicate mood of both domestic and foreign investors.

Movement of Economy GPS over the months

Month- Year Economy GPS Index
Jul-17 72.3
Aug-17 96.8
Sep-17 98.2
Oct-17 94.9
Nov-17 92.0
Dec-17 88.0
Jan-18 96.7
Feb-18 93.6
Mar-18 97.8
Apr-18 102.1
May-18 100.1
Jun-18 97.7
Jul-18 100.9
Aug-18 101.2
Sep-18 101.4
Oct-18 99.8
Nov-18 97.4
Dec-18 93.7
Jan-19 101.4
Feb-19 98.8
Mar-19 105.6
Apr-19 104.0
May-19 98.1
Jun-19 97.3
Jul-19 94.3
Aug-19 91.0
Sep-19 92.4
Oct-19 102.0
Nov-19 103.9
Dec-19 101.0
Jan-20 107.1
Feb-20 103.2
Mar-20 80.0
Apr-20 39.6
May-20 50.1
Jun-20 75.1
Jul-20 85.6
Aug-20 90.5
Sep-20 100.2
Oct-20 109.6
Nov-20 106.9
Dec-20 114.8
Jan-21 121.7
Feb-21 122.0
Mar-21 122.9
Apr-21 124.3
May-21 91.5
June-21 107.5
July-21 119.7
August-21 116.7
September-21 113.1
October -21 127.0
November-21 128.8

Source: PHD Research Bureau, PHDCCI GPS Index


Media Division

PHD Chamber of Commerce and Industry