Winning Bizness Economic Desk

The Manila-headquartered Asian Development Bank (ADB) has retained its projection on India’s GDP growth for this current fiscal year (FY 25) at seven per cent.

For the next fiscal (2025-26), the ADB has projected the country’s GDP growth at 7.2 per cent.

The institution, however, said that geo-political shocks that could disrupt global supply chains and commodity prices pose near term risks.

“India’s economy has shown remarkable resilience in the face of global geo-political challenges and is poised for steady growth,” said the ADB’s Country Director for India, Ms Mio Oka.

According to Ms Oka, “agricultural improvements will enhance rural spending, which will complement the effects of robust performance of the industry and services sectors.”

In its Asian Development Outlook update for last month (September 2024), the Asian Development Bank said that an above average monsoon in most parts of the country would lead to strong agriculture growth, thus giving a leg-up to the rural economy.

The report maintains a positive outlook for the industry and services sectors, private investment and urban consumption for 2024-25 and 2025-26.

India’s GDP expanded by 8.2 per cent in the financial year ended March 2024 (FY 24).

Here, it must be highlighted that the ADB’s growth projection for the Indian economy for the current financial year (FY 25) is lower than the Reserve Bank of India (RBI)’s estimate of 7.2 per cent.

Sept GST Collection Stands at Rs 1.73-lakh-cr

The Goods and Services Tax (GST) collections in September of this year stood at Rs 1,73,240-crore.

This is the slowest growth in collections in 40-months on a Year-on-Year (YoY) basis as also the second lowest monthly collection so far this fiscal (FY 25).

However, the point to note here is that GST collections for the April-to-September period of this fiscal (FY 25) are still 9.5 per cent higher as compared to the same period last year.

Thus far this fiscal, the total GST mop-up accounts for 53 per cent of total FY 24 collections.

A state-wise performance revealed that seven states recorded negative revenue growth, with the highest contraction clocked in Manipur at 33 per cent.

Ten other states, including Telangana (1 per cent), Rajasthan (2 per cent), Uttar Pradesh (3 per cent) and Tamil Nadu, Maharashtra and West Bengal at five per cent each, registered growths below the national average of six per cent.

An important point here is that the northern state of Haryana registered the highest revenue rise at 24 per cent followed by Delhi at 20 per cent.

The GST collections announced for September of this year are based on the business activities undertaken in the previous month (August) and reported in September.

Kharif Crop Sowing Area Up by 1.9 Per Cent

Kharif crop sowing in the country has been very strong this season with farmers planting crops across 1,108.57-lakh-hectares so far.

In the same period of last year, the number stood at 1,088.25-lakh-hectares, marking a 1.9 per cent Year-on-Year (YoY) increase.

This surpasses the average area under cultivation (or normal area of 1,096-lakh-hectares) for the period from 2018-19 to 2022-23.

Commodity-wise, the sowing of paddy, pulses, oilseeds, millets and sugarcane has increased YoY while sowing for cotton and June/mesta continues to remain lower.

As paddy farmers brought 2.5 per cent more area under coverage, the government which had imposed several restrictions on exports of rice, has eased some of them.

It removed minimum export price on basmati rice, allowed the export of non-basmati white rice but subject to a minimum export price of USD 490/tonne, and it halved export duty on parboiled rice to ten per cent.

A point that needs to be noted here is that within the pulse basket, aside from urad bean, crops such as arhar, moong, kulthi and moth bean have clocked positive growths.

What needs highlighting here is that India is a major producer and consumer of pulses and the primary pulses consumed in India include chana, masur, urad, kabuli chana and tur.

In the 2023 kharif season, the total area under cultivation across the country was 1,107.15-lakh-hectares. The normal kharif area between 2018-19 and 2022-23 is 1,096-lakh-hectares.

India’s Forex Reserves Reach Record High

The country’s foreign exchange reserves have risen steeply by USD 2.838-billion to reach a new high of USD 692.3-billion as of the week ended September 20, as compared to USD 689.4-billion as of September 13, according to data released by the Reserve Bank of India (RBI).

The Reserve Bank’s data showed that the foreign currency assets (FCAs) which is the major contributor to the forex reserves, increased by USD 2.057-billion to USD 605.686-billion as of September 20 as compared to USD 603.629-billion as of September 13.

The Foreign Currency Assets (FCAs) include the effect of appreciation or depreciation of non-US units such as the Pound, Euro and Yen held in the forex reserves.

The Reserve Bank data also showed a USD 726-million increase in gold reserves to USD 63.613-billion in the latest filing, compared to USD 62.887-billion in the September 13 period.

Gold is the second largest contributor to the country’s foreign exchange reserves. Two other elements contribute to forex—Special Drawing Rights (SDRs) and the reserve position in the International Monetary Fund (IMF).

According to the Indian central bank’s data, the SDRs moved northward by USD 121-million to USD 18.540-billion as of September 20, as compared to their previous level of USD 18.419-billion as of September 13.

The country’s reserve position with the IMF slid USD 65-million to USD 4.458-billion as of the latest data filing, as compared to USD 4.523-billion in the previous week’s data, the RBI data showed.

Housing Sales Rise Five Per Cent Across Eight Cities in July-Sept Period: Knight Frank India

Housing sales increased five per cent annually in the July-to-September period to 87,108 units in eight major cities as demand stayed strong for premium homes, Knight Frank India stated.

Its report India Real Estate for the third-quarter (Q3) of calendar year 2024 released through a webinar, showed a modest increase in housing sales in contrast to data provided by Anarock and PropEquity which reported a slide in total sales during the July-to-September period across major cities.

“Momentum in the residential market has trended up well in 2024 with Q3 2024 recording the highest quarterly sales this year at 87,108 units,” the report stated.

As per the report, housing sales have risen across all markets except for the Delhi-NCR region where sales have dipped by seven per cent Year-on-Year (YoY).

Beverage Industry’s Plea to FSSAI on 100 Per Cent Juice Claim

The country’s beverage industry has asked the Food Safety and Standards Authority of India (FSSAI) to allow them to make `100 per cent’ juice claim in products that have no “added sugar”.

The Indian Beverage Association (IBA), the leading industry body of beverage-makers has pointed out that this is in line with the regulations of many international markets where the “100 per cent juice” term is recognised.

In its petition to the food safety authority, the beverage industry body has said that 100 per cent fruit juice, whether fresh or reconstituted, which does not contain any “added extraneous sugar, sugars or nutritive sweeteners”, should be allowed to make the claim of being “100 per cent fresh juice”.

It added that such fruit juices are known as “unsweetened juices”.

In June, the FSSAI had ordered beverage companies to remove claims of “100 per cent fruit juice” from labels as well as advertisements of reconstituted fruit juice products.

The authority had observed that the regulations have no provisions allowing companies to make a “100 per cent fruit juice” claim and hence are misleading.

It is reported that the beverages industry, in its petition to the food safety authority officials has pointed out that countries such the United States, Canada as well as the World Health Organisation (WHO)’s nutrient profile model recognises “100 per cent fruit juice”.