PHDCCI Quick Economic Trends for January 2021

No. PR- 221

February 12, 2021

New Delhi

 

PHDCCI Quick Economic Trends for January 2021

 

Speedy economic recovery continues, positive GDP growth soon: PHD Chamber

 

Improvement in unemployment rate, strong stock market, high GST collections and elevated manufacturing PMI in January 2021 indicate speedy economic recovery, says the industry body PHDCCI

 

Mr Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry has appreciated the movement of Indian economy in right direction and expressed confidence in the speedy economic recovery, in a press statement issued here today.

 

Mr Sanjay Aggarwal has congratulated Mrs Nirmala Sitharaman, Hon’ble Finance Minister for presenting a historic budget and considering the aspirations of all sections of the society for the improvement of standards of living and ease of doing business in industry across the segments.

 

On the back of various reforms undertaken by the Government in last 10 months along with a demand boosting & investment inducing Budget, the expectations of a positive GDP growth in Q3 and in Q4 FY 2020-21 are becoming strong, said Mr. Sanjay Aggarwal.

 

The Economic Survey 2020-21 projections for India’s growth at (-)7.7% in FY2020-21 with significant growth rebound to the level of 11% in FY2021-22, following a v-shaped growth recovery is highly encouraging for businesses to move forward with a strong zeal and strength, said Mr. Sanjay Aggarwal.

 

Out of the 10 indicators of QET (Quick Economic Trends) of economic and business activity tracked by the industry body PHDCCI, 9 have performed positive of which unemployment rate has shown a highest sequential improvement of around 28% in January 2021 over the previous month, December 2020.

 

10 economic and business indicators of QET include demand and supply side indicators along with external sector and financial indicators, said Mr. Sanjay Aggarwal.

 

Economic and business indicators such as unemployment rate, Stock Market, GST Collections, Manufacturing PMI, Forex Reserves, Railway Freight, Merchandise Exports, Exchange Rate and Passenger Vehicle Sales have shown positive sequential growth in January 2021 as compared with December 2020, he said.

 

However, E-way Bill generation has recorded decrease to 62.9 million in January 2021 as compared to 64.1 million in previous month of December 2020, said Mr. Sanjay Aggarwal.

 

Going by the performance of 10 economic and business indicators of QET, the performance in January 2021 is in sync with the performance of December 2020, while it is better as compared to October and November 2020, as  9 out of 10 economic and business indicators have improved in January 2021 and December 2020 each as against 8 in October 2020 and 6 in November 2020.

 

PHDCCI Quick Economic Trends : Growth Performance of Economic & Business activity so far

S. No. Economic and Business Indicators September 2020 October 2020 Growth (Sequential) November 2020 Growth (Sequential) December 2020 Growth (Sequential) January 2021 Growth (Sequential)
1 2 3 4 5 6 7 8 9 10 11
1 GST Collection (in Rs crore) 95480 105155 10.1% 104963 (-)0.2% 115174 9.7% 119847 4.1%
2 E way bill  (in Millions) 57.4 64.1 11.7% 55.3 (-)13.7% 64.1 15.9% 62.9 (-)1.9%
3 Unemployment Rate (in %) (Sign Changed)* 6.67 6.98 (-)4.6% 6.51 6.7% 9.06 (-)39.2% 6.53 27.9%
4 Railway Freight (MT) 102 108 5.8% 110 1.6% 118.13 7.4% 119.8 1.4%
5 Passenger  Vehicle Sales (units) 272027 310294 14.1% 264898 (-)14.6% 276412 4.3% 276554 0.1%
6 Forex Reserves (in US$ Billion) 499.9 518.3 3.7% 575.2 11.0% 581.1 1.0% 590.2 1.6%
7 Exchange Rate (INR/USD) (Sign changed)* 73.56 74.55 (-)1.3% 73.99 0.8% 73.04 1.3% 72.88 0.2%
8 Stock Market (SENSEX monthly average) 38379 40115 4.5% 43011 7.2% 46212 7.4% 48580 5.1%
9 Merchandise Exports (US$ Billion) 27 25 -7.4% 23 -8% 27.15 18.1% 27.24 0.3%
10 Manufacturing PMI (points) 56.8 58.9 3.7% 56.3 (-)4.4% 56.4 0.2% 57.7 2.3%
Overall growth performance of indicators of QET 8↑/10 6↑/10 9↑/10 9↑/10

Source : PHD Research Bureau, PHDCCI, compiled from various sources

Note : *Growth calculations of indicators such as exchange rate and unemployment are adjusted such that the decrease in the said indicators depicts improvement and vice-versa; figures are rounded off

 

At this juncture, to continue the recovery momentum of economic and business activity, immediate policy attention is required towards credit access to industry and services sectors. Credit disbursement should be the top most priority at this juncture by the banking sector. 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.

 

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, said Mr. Sanjay Aggarwal.

 

Ends

Media Division

PHD Chamber of Commerce and Industry