The full Union Budget 2024 was released on 22nd July, and the day before India’s Economic Survey forecasted the GDP growth at 6.5-7 per cent.
Retail Inflation in India decreased to 5.4 per cent in FY24 to 6.7 per cent in FY23, the current account deficit also improved to 0.7 per cent of GDP in FY24 from 2 per cent in FY23.
The Union Budget introduced allocations for infrastructure, MSME support, and renewable energy projects. The budget also outlined plans for developing cities as growth hubs, enhancing energy security, and supporting climate-friendly initiative
While the Indian economy is depicting healthy variables, Here is how India’s macroeconomic indicators performed in July:
Goods and Service Tax
The Goods and Services Tax (GST) collections stood at Rs 1.82 Lakh crores in July 2024, reflecting a 10.3% year-on-year growth. Among the states, Ladakh and Lakshwadeep registered the highest growth and the lowest growth rates at 67% and -51%, respectively.
Inflation
Retail Inflation for July stood at 3.54% which is the lowest in nearly 5 years. Food Inflation marked another low at 5.42% in July compared to 9.36% in June.
Economists suggested that such a low has been observed due to the base effect, given the retail inflation in July 2023 was recorded at 7.4% and hence bringing down the number.
July witnessed the subgroup of vegetables, fruits, and spices recording a significant decline.
Inflation Rates (Jan-July 2024)
Unemployment
Unemployment rate in India, among persons aged 15 years and above, saw a drop in July 2024 to 7.9. It fell to 7 per cent in the month, which was its lowest recorded since September 2022.
In June 2024, the unemployment rate experienced a sharp increase to 9.2 per cent.
Unemployment Rates (Jan-Jul 2024)
Purchasing Manager’s Index
The seasonally adjusted HSBC India composite PMI fell to 60.7 in July from 60.9 in June 2024.
India’s manufacturing PMI dipped to 58.1 in July from 58.3 in June, despite a slight deceleration in new orders and outputs in July, international sales was one of the fastest in 13 years.
The services PMI also declined to 60.3 in July from 60.5 in June, the overall rate of change in inflation climbed to seven year high.
India’s Index for Industrial Production
The Index of Industrial Production (IIP) for June 2024, released in August, indicated a growth rate of 4.2% year-on-year which was 4% in June 2023.
The Indices of Industrial Production for the Mining, Manufacturing and Electricity sectors for the month of June 2024 stand at 134.9, 145.3 and 222.8 respectively.
IIP Growth Rates by Sector for June 2024
Trade Merchandise
India’s trade deficit expanded in July 2024 at USD 23.5 Billion, driven by a combination of declining merchandise exports and rising imports.
Imports rose 7.5% year-on-year to USD 57.48 billion, up from USD 53.49 billion in the same period last year. This resulted in a merchandise trade deficit of USD 23.50 billion.
Exports and imports in services stood at USD 28.43 billion and USD 14.55 billion respectively this month.
The overall trade balance, which includes both merchandise and services, also declined, with a deficit of USD 9.61 billion in July 2024, compared to a deficit of USD 6.52 billion in July 2023.
FII and DII Statistics
Foreign portfolio investors (FPIs) recorded net inflows of Rs. 48,796 crore in July 2024. Conversely, domestic institutional investors (DIIs) reported net investments of Rs. 23,486.02 crore. The equity markets ended the month with the NSE Nifty 50 and the BSE Sensex closing at 24,951.40 and 81,741 respectively.
UPI Transactions
The Unified Payments Interface (UPI) continued its upward trajectory, with 605 banks participating, compared to 602 in June 2024. The volume of transactions reached 14,435.55 million, and the value hit Rs. 20,64,292.40 crore.
UPI Transactions (July 2024)
UPI Transaction Volume and Value in July 2024
