Winning Bizness Economic Desk

Renowned global ratings agency Moody’s has upped its GDP growth forecast for the country for this fiscal (FY 24) from a much lower 6.6 per cent to a robust eight per cent.

For the calendar year (CY) 2024, Moody’s raised its GDP growth forecast to 6.8 per cent from 6.1 per cent.

The raise in its GDP growth forecast for FY 24 comes on the back of strong government expenditure and domestic consumption.

In its Banking System Outlook, the globally reputed ratings agency said: “We expect India to be the fastest-growing economy among major G-20 countries, with its real GDP growth to accelerate to around eight per cent in the fiscal ending March 2024 (FY 24) from seven per cent in FY 23.”

In the quarter ended December (October-to-December 2023), the country’s economy fared extremely well with an astonishing growth of 8.4 per cent, belying fears of tempering as manufacturing, electricity and construction segments put up a strong show.

Here, it must be pointed out that the country’s Q1 and Q2 numbers were both upwardly revised; the Q1 GDP growth figure was updated to 8.2 per cent while the Q2 GDP growth figure was revised upward to 8.1 per cent.

The unexpectedly robust economic performance and the high growth figure has made the National Statistical Office (NSO) revise its GDP growth estimate for this fiscal (FY 24) from 7.3 per cent in its first advance forecast to 7.6 per cent in its second revised estimate.

India’s central bank, the Reserve Bank of India (RBI) has pegged economic growth estimate for the country at seven per cent for this fiscal while the International Monetary Fund (IMF) has forecast a 6.7 per cent growth.

The Indian economy continued its strong northward movement in February, clocking healthy growths in both the manufacturing and services sectors. A point that needs highlighting here is that the country’s economy expanded at a four-month high in January and this continued in February as well.

While the services sector climbed to a seven-month high in February, the manufacturing sector’s growth reached a five-month high.

February GST Revenue Collection Rises 12.5 Per Cent to Rs 1.68-lakh-crore

The country’s Goods and Services Tax (GST) revenue collection in February of this year increased a creditable 12.5 per cent to Rs 1,68,337-crore, as compared to the same in the year-ago period (2023).

This figure was released by the Finance Ministry.

“GST revenue net of refunds for February 2024 is Rs 1.51-lakh-crore which is a growth of 13.6 per cent over that for the same period last year,” a press release issued stated.

The growth in February’s GST revenue is primarily driven by a very healthy 13.9 per cent northward movement in GST from domestic transactions combined with an 8.5 per cent increase from import of goods.

This fiscal (FY 24) has witnessed a strong performance in GST revenue collections with total gross GST collection standing at a very impressive Rs 18.40-lakh-crore as of February of this year.

This is a 11.7 per cent jump over the same period in the previous fiscal year, which is very creditable indeed.

What needs highlighting here is that the average monthly gross collection for FY 24 stands at Rs 1.67-lakh-crore, surpassing the Rs 1.5-lakh-crore registered in the corresponding period of the last fiscal (FY 23).

An important point here is that the net GST revenue for FY 24 after refunds, has jumped 13 per cent (as compared to the year-ago period) to Rs 16.36-lakh-crore as of February this year.

India’s Forex Reserves Climb to USD 625-bn

The country’s foreign exchange reserves moved northward by USD 6.55-billion to USD 625.626-billion during the week ended March 1, data from the Reserve Bank of India (RBI) revealed.

In the previous reporting week, the overall foreign exchange reserves had climbed by USD 2.975-billion to USD 619.072-billion.

Here, it must be pointed out that the country’s foreign exchange reserves had touched an all-time high of USD 645-billion in October 2021.

For the week ended March 1, the foreign currency assets (FCA), a major component of the reserves, increased by USD 6.043-billion to USD 554.231-billion, the Reserve Bank data said.

Expressed in dollar terms, the foreign currency assets include the effect of appreciation or depreciation of non-US units like the Euro, Pound and Yen held in the foreign exchange reserves.

Gold reserves increased by USD 569-million to USD 48.417-billion during the week while the Special Drawing Rights (SDRs) were down by USD 17-million to USD 18.18-billion.

India’s reserve position with the International Monetary Fund (IMF) was also down by USD 41-million to USD 4.798-billion in the reporting week, the Reserve Bank of India data showed.

UPI Now Live in Nepal

The National Payments Corporation of India (NPCI) has said that the Unified Payments Interface (UPI) has now gone live in Nepal. UPI users can now scan QR codes to make payments to Nepalese merchants, according to an official statement.

“NPCI International Payments Ltd (NIPL), the international arm of the National Payments Corporation of India (NPCI) and Fonepay Payment Service Limited, Nepal’s largest payment network, have announced that Unified Payments Interface (UPI) is now live for cross-border transactions between India and Nepal,” the NPCI said in a statement.

In the first phase, this partnership will enable Indian consumers to make instant, secure and convenient UPI payments across various business stores in Nepal by using UPI-enabled apps.

Merchants acquired by the participating members of Fonepay Network can seamlessly accept UPI payments from Indian customers, it said.

This follows a tie-up between the National Payments Corporation of India International Payments (NIPL) and Fonepay Payment Service in September last year.

India Begins Importing Pulses From Brazil

India has now started to import pulses from the South American nation of Brazil—for the first time, the country has started to source urad dal from Brazil.

The first consignment of around 3,000-tonnes of urad dal from the South American country has already arrived. The import is being done to overcome the shortfall in domestic output.

“We are working with Brazil and Argentina for the import of urad and tur as depending on one country poses a risk,” a senior official was quoted as saying.

It is expected that around 20,000-tonnes of urad are likely to be imported into India from Brazil. The government has already held a series of talks with both Argentina and Brazil for the imports.

Here, a point to be noted is that presently India imports urad dal only from one country—from neighbouring Myanmar—where, however, because of internal security problems, supply disruptions have emerged.

Another important point here is that domestic consumption of pulses in South American countries is low. Besides, in both the South American countries, the weather is conducive for the growth of pulses.

Last year (2023), the country imported 2.98-million tonnes of pulses—these include 1.51-million tonnes of lentil, 0.77-million tonnes of tur or pigeon pea and 0.59-million tonnes of urad or black gram. The countries mainly imported from are Australia, Canada, Myanmar, Mozambique, Tanzania, Sudan and Malawi.

According to sources, since allowing duty-free import of yellow pea in December of last year, India has imported 0.5-million tonnes of pulse variety which is used as a substitute for chana or gram.

“Another 0.5-million tonnes are expected to be imported in the next couple of months mostly from Canada and Russia,” an official said.

A point to be mentioned here is that in 2016, India has inked an MoU with Mozambique for the import of 0.2-million tonnes of arhar annually for five-years and this has now been extended for five more years in September 2021.

Similarly, in the same year, India entered into an MoU with Malawi for the import of 50,000-tonnes of tur per annum for the next five-years. It must be highlighted here that under an MoU, India is committed to import 0.1-million tonnes of tur and 0.25-million tonnes of urad from Myanmar till 2026.