Indian economy is on upswing: Finance Ministry

New Delhi: The Indian economy experienced a notable upswing across various economic indicators in July 2024, signalling strong and resilient business activities with both the manufacturing and services sectors posting a robust performance, according to the Finance Ministry’s monthly review released on Thursday.

“The month saw impressive milestones being reached, substantial growth in GST collections, and a significant rise in e-way bill generation, which points to an overall increase in economic activity. The stock market indices also reached record highs in July,” the review states.

On balance, India’s economic momentum remains intact. Despite a somewhat erratic monsoon, reservoirs have been replenished. Manufacturing and services sectors are expanding, going by the Purchasing Managers’ indices. Tax collections – especially indirect taxes, which reflect transactions – are growing healthily, and so is bank credit, according to the review.

Inflation is moderating, and exports of both goods and services are doing better than they did last year. Stock markets are holding on to their levels. Foreign direct investment is looking up as gross inflows are rising, the review states.

Gross GST collections for July 2024 maintained their momentum, achieving their second-highest level since May 2023. The total gross GST revenue rose by 10.3 per cent year-on-year (YoY), bringing the total for FY 25 (April to July) to Rs 7.4 lakh crore.

This increase in GST collections also highlights robust compliance and expansion of GST coverage across various economic activities. The upward level shift is reflected in the average monthly GST collections rising from Rs 1.68 lakh crore in FY24 to Rs 1.85 lakh crore in FY25.

The year-on-year increase in e-way bills reached a nine-month peak of 19.2 per cent with the total number of e-way bills issued in July surging to 10.5 crore, setting a new single-month record.

According to the review, the manufacturing sector has continued to demonstrate robust performance in the first four months of FY25, as evidenced by the strong performance of various high-frequency indicators.

The Purchasing Managers’ Index (PMI) Manufacturing, a crucial gauge of the economic vitality of the manufacturing sector, stood at 58.1 in July 2024, significantly above the series long-run average and among the highest recorded in recent years. This expansion, driven by buoyant demand conditions and a surge in production volumes, bodes well for the overall health of the economy. (IANS)

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