India’s economic recovery well underway

Going by the recent indicators, there are clear and happy signs that India’s economy, badly bruised by the Covid-19, is now recovering by and by.

The rail freight is up 15.33 % in comparison with the corresponding period during the previous years.

29 million sought work under MNREGS (Mahatma Gandhi National Rural Employment Gurantee Scheme), which was lowest since May. In fact, that the rural economy did grow even under Corona, is clearly evident from that the agricultural sector has done remarkably well with record food grain production. The move to front-load the PM Kisan Nidhi and other cash transfers, increase in MGNREGS wages, increase in MSPs combined with a good agricultural year led to a 3.4 per cent growth in the first quarter itself when the entire economy contracted.

Power demand in the country has gone up by 4.6 per cent, marking a growth in September at 113.5 billion units.

In the first fortnight of September, petrol consumption grew by 2% and diesel consumption grew by 5.5% compared to the previous years.

Exports stood at $27.4 billon in September (up by 5.27% in comparison to the corresponding period last year).

Growing demand for steel suggests that the real estate sector is changing gears and accelerating.

The aviation sector is becoming more active now. The average number of weekly air travellers increased from about 38,000 in the week starting May 29 to a whopping 135,000 in the week beginning September 25.

And now the most important indicator of the economic revival is manifested in the fact that GST collection crosses Rs 1 lakh crore mark for first time since February.

Goods and Services Tax (GST) collections for October grossed Rs 1.05 lakh crore, the highest so far in the financial year and 10% higher than collections in the same month last year, which stood at Rs 95,379 crore.

The gross GST revenue collected in the month of October, 2020 is Rs. 1,05,155crore of which CGST is Rs. 19,193 crore, SGST is Rs. 25,411 crore, IGST is Rs. 52,540 crore (including Rs. 23375crore collected on import of goods) and Cess is Rs. 8,011crore (including Rs. 932 crore collected on import of goods). The total number of GSTR-3B Returns filed for the month of October up to 31st October, 2020 is 80 lakh.

The government has settled Rs. 25,091 crore to CGST and Rs. 19,427 crore to SGST from IGST as regular settlement. The total revenue earned by Central Government and the State Governments after regular settlement in the month of October, 2020 is Rs. 44,285 crore for CGST and Rs.44,839 crore for the SGST.

The revenues for the month are 10% higher than the GST revenues in the same month last year. During the month, revenues from import of goods was9% higher and the revenues from domestic transaction (including import of services) are11% higher that the revenues from these sources during the same month last year. The growth in GST revenue as compared to that in months of July, August and September, 2020 of -14%, -8% and 5% respectively clearly shows the trajectory of recovery of the economy and, correspondingly, of the revenues.

The chart shows trends in monthly gross GST revenues during the current year. The table shows the state-wise figures of GST collected in each State during the month of October, 2020 as compared to October, 2019 and for the full year.