Is Indian Economy ‘Recovering’ – Burning Issues – Free PDF Download

• But steeply falling revenues and central grants has led to- 18 biggest states reporting a collective revenue deficit of 285% of Budget Estimates in April-June.
• The consolidated fiscal deficit of the Centre and the states is expected to touch 13% of GDP this fiscal, said an SBI report.

Automobile sales

• Car companies like Maruti (33%) and Hyundai (4%) reported an increase in sales in September,
• Mahindra & Mahindra reported a 17% increase in tractor sales and
• Bajaj Auto registered its highest exports ever last month.

• Automobile manufacturers showed significant signs of recovery as they dispatched 13% more vehicles to dealers in September

As compared to the same period last year.

• But corporate India’s credit profiles have hit the lowest in a decade and the stress is likely to continue this year.

• Crisil’s credit ratio of Indian companies for April-September was at 0.54, the lowest in more than a decade,
• With 296 downgrades and 161 upgrades.
• Credit ratio is number of upgrades to downgrades.

• The Unified Payments Interface (UPI) transactions stood at Rs 3.29 lakh crore in September with number of transactions at 180 crore, NPCI data showed on Thursday.
• The transactions were higher by over 10% from Rs 2.98 lakh crore in August.
• Volume wise, it grew nearly 12%.

Bank’s credit growth

• But The banking system’s credit growth will plummet to a multi-decadal low of up to 1% in 2020-21, Ratings agency Crisil said.

• Generally, bank credit growth is said to be directly linked to the economic activity, which is set to contract by over 10 per cent in FY21.
• “Given the grim economic outlook, the banking system’s credit growth will come at between 0-1 per cent in FY21. This will be a multi-decade low”

Petrol & diesel

• Petrol sales rose 2% in September, the first increase since the lockdown in March,
• But diesel consumption was down 7.3%.

Manufacturing PMI grows fastest in 8 years

• However, the job scenario remained bleak due to social-distancing norms.

Q) Which of the following statements regarding GDP is/are correct?

1.  The growth rate of GDP has steadily increased from FY 16 to FY 20.
2.  Per capita income has steadily increased from FY 16 to FY 20.

1. 1 only
2. 2 only
3. Both 1 & 2
4. None of the above

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