~Shrishti Sharma
In April 2024, India’s economy showed resilience amidst global uncertainty. GDP growth surged to 8.4%, driven by manufacturing, mining, and construction sectors. Projections revised upwards to 7.6-7.8% by Deloitte and PwC. Nifty index rose steadily ahead of Lok Sabha elections, though market volatility concerns remained. RBI maintained interest rates but potential cuts expected later due to global trends.
Amid the current backdrop, here is how the macroeconomic indicators performed in the first month of FY25.
Goods and Service Tax
The Goods and Services Tax (GST) collections hit an unprecedented high of Rs. 2.10 lakh crore in April 2024, reflecting a 12.4% year-on-year growth. This surge was driven by a strong increase in domestic transactions (up 13.4%) and imports (up 8.3%). Among the states, Mizoram and Lakshadweep registered the highest growth rates at 52% and 57%, respectively.
Inflation
The annual inflation rate based on the all-India Consumer Price Index (CPI) stood at 4.83% in April 2024, slightly down from 4.85% in March. This rate varied between rural (5.43%) and urban (4.11%) areas. Notably, inflation in the categories of ‘Clothing & Footwear,’ ‘Housing,’ and ‘Fuel & Light’ saw a decline compared to the previous month.
CPI Inflation Rates (Jan-Apr 2024)
Unemployment
Unemployment saw an uptick, rising to 8.1% in April 2024 from 7.4% in March. This increase was observed across both urban and rural regions. Rural unemployment rose to 7.8% from 7.1%, while urban unemployment climbed to 8.7% from 8.1%. Concurrently, the labour participation rate (LPR) decreased to 40.9%, and the employment rate fell to 37.6%.Unemployment Rates (March-April 2024)
Purchasing Manager’s Index
The HSBC India Manufacturing Purchasing Manager’s Index (PMI) was revised lower to 58.8 in April 2024 from 59.1 in March, yet it remained the second-fastest growth rate in over three years. This robust performance was driven by a sharp increase in new business intakes and production. Despite moderate job creation, it was the fastest since September 2023. Cost pressures saw a slight uptick, pushing output charge inflation to a three-month high.
India’s Index for Industrial Production
The Index of Industrial Production (IIP) for March 2024, released in April, indicated a growth rate of 4.9% year-on-year. The manufacturing sector contributed significantly with a growth rate of 5.2%. Within manufacturing, the standout segments included basic metals (7.7%), pharmaceuticals (16.7%), and other transport equipment (25.4%).
Trade Merchandise
India’s merchandise and services exports began FY 2024-25 with a 6.88% growth, amounting to USD 64.56 billion in April 2024. Merchandise exports alone grew by 1.08% to USD 34.99 billion. Key drivers included electronic goods (up 25.8%), organic and inorganic chemicals (up 16.75%), petroleum products (up 3.10%), and drugs and pharmaceuticals (up 7.36%).
Merchandise Export Growth Drivers (April 2024)
FII and DII Statistics
Foreign portfolio investors (FPIs) recorded net outflows of Rs. 16,260 crore in April 2024. Conversely, domestic institutional investors (DIIs) reported net investments of Rs. 44,186.28 crore. The equity markets ended the month with the NSE Nifty 50 and the BSE Sensex closing at 22,605 and 74,482.78, respectively.
UPI Transactions
The Unified Payments Interface (UPI) continued its upward trajectory, with 581 banks participating. The volume of transactions reached 13,303.99 million, and the value hit Rs. 19,64,464.52 crore.
UPI Transactions (April 2024)
Foreign Exchange Reserves
As of April 26, 2024, India’s foreign exchange reserves stood at Rs.53,17,256 crore (USD 637,922 million), marking a weekly decline of Rs. 27,665 crore (USD 2,412 million) and a monthly decrease of Rs. 74,000 crore (USD 8,497 million). However, compared to the previous year, the reserves have increased by Rs. 4,98,798 crore (USD 49,142 million).
