-Samriddhi Singh Mahar and Suhani Prakash
In October 2024, the Indian economy showed mixed performance based on key macroeconomic indicators.
GST revenues increased significantly and tax revenues stood at Rs 1.87 Lakh Crore, growing at 7.9% YoY. UPI transactions continued to grow, reaching a volume of 16,584.97 million.
However, unemployment spiked to 10.1%, driven by rural areas. Inflation rose slightly, while industrial production and PMI signaled growth. Goods exports grew significantly, although trade deficits widened.
Overall, the economy was mixed in October, with some sectors performing well, while some sectors continued to face challenges and resistance to growth.
As we go through these fluctuations in India’s economy, here is what the macroeconomic indicators for the month of October 2024 reveal:
Goods and services tax:
The goods and services tax collection stood at Rs 1.87 Lakh Crore for October 2024, which is a sharp spike from the Rs 1.73 Lakh Crore collection in September 2024. The GST revenue recorded a YoY growth of 7, 9% for October 2024.
Maharashtra has continued to maintain its position as the top collector with Rs. 31,030 crore GST collection for the month of October, a significant increase over the September revenue of Rs 26,369 crore.
The CGST collections rose to Rs 33,821 crore, while the SGST collections rose to Rs 41,864 crore. IGST, including import revenue, rose to Rs 99,111 crore, and collections stood at Rs 12,550 crore.
UPI transactions:
UPI transactions reached a volume of 16,584.97 million and a value of Rs 23,49,821.46 crore in October, with a revival fueled by the inclusion of 10 new banks. This highlights the growing adoption of digital payments and the growing financial ecosystem in India.
Unemployment:
The unemployment rate among people aged 15 and over rose to 10.1% in October 2023, up from 7.1% in September. This is the first time in 29 months that the rate has exceeded 10%.
The rural unemployment rate rose sharply from 6.2% to 10.8%, while the urban unemployment rate fell slightly to 8.4%. Although unemployment typically rises in October, this year’s increase has been noticeably steep, with the increase entirely attributable to rural India.
Inflation:
The year-on-year retail inflation (CPI) for the month of October 2024 is 6.21%, up from last month’s 5.49%. The corresponding retail inflation rates for rural and urban areas are 6.68% and 5.62% respectively.
As of October 2024, the preliminary annual inflation rate as measured by the All-India Consumer Food Price Index (CFPI) was 10.87%, with rural inflation at 10.69% and urban inflation of 11.09%.
Industrial Production Index:
According to the data released by the Ministry of Statistics for the month of September, the Index of Industrial Production (IIP) increased from 145.7 in August 2024 to 146.7 in September 2024, indicating an improvement in the growth rate of a negative -0.1% to 3.1%. growth in the previous month.
The index for primary goods stood at 141.3, a growth of 1.8% compared to September 2023, while capital goods stood at 115.8, with a growth rate of 2.8% year-on-year.
Intermediate goods saw a growth of 4.2% with an index value of 160.7, infrastructure/construction goods reached 178.5 and a growth of 3.3%, consumer durables and consumer non-durables had an index value of 133.1 and 145.5 and a growth rate of 6.5% and 2.0% respectively.
The three largest contributors to the IIP are the manufacture of base metals (weight: 12.8043), the manufacture of coke and refined petroleum products (weight: 11.7749) and electricity (weight: 7.9943).
Index of purchasing managers:
The Purchasing Managers’ Index (PMI) rose to 57.5 for the month of October 2024, according to S&P Global’s report. In September 2024, the PMI was recorded at 56.5, indicating growth in India’s manufacturing sector.
Companies reported better sales, helped by new products and marketing. Demand for Indian goods increased both in India and abroad, with new deals coming from Asia, Europe, Latin America and the US.
There was also more hiring and an increase in raw material purchases. However, costs for materials, labor and transportation increased, leading to higher prices.
“India’s manufacturing purchasing managers index rose significantly in October as conditions in the economy continue to improve overall.” says Pranjul Bhandari, chief India economist at HSBC.
FII and DII:
In October 2024, India’s net Foreign Portfolio Investment (FPI) showed an outflow of Rs 94,017 crore in equities and an outflow of Rs 4,406 crore in debt, according to data from the National Securities Depository Limited (NSDL). Total net outflows stood at Rs 96,358 crore across asset classes.
Indian stock indices closed with small losses in October 2024. The BSE Sensex ended at 80,065.16, down 16.82 points (0.02%). The NSE Nifty50 closed at 24,399.40 and fell 36.10 points (0.15%).
Merchandise:
In October 2024, India recorded total exports of USD 73.21 billion, reflecting a growth of 19.08% compared to October 2023. Total imports stood at USD 83.33 billion, an increase of 7.77% over the previous year.
Non-petroleum exports rose to $34.61 billion, an increase of 25.63%. Exports of non-petroleum, non-precious stones and jewelry rose 27.68% to $31.36 billion.
Services exports were estimated at $34.02 billion, up from $28.05 billion in October 2023. Services imports amounted to $17 billion.
October 2024 resulted in a trade deficit of $27.14 billion. Merchandise exports amounted to $39.20 billion, up 17.23% from October 2023, while merchandise imports amounted to $66.34 billion, up from $63.86 billion in October 2023.
From April to October 2024, India’s top import sources that showed growth included the UAE (55.12%), Angola (99.84%), Taiwan (45.45%), China (9.8%) and Russia (8.85%).
The key drivers of goods export growth in October 2024 include engineering goods, electronic goods, organic and inorganic chemicals, rice and RMG of all textile products, according to the data released by the Ministry of Trade and Industry.
