New Delhi: The Indian economy gathered pace in June with goods movement rebounding close to pre-lockdown levels and goods and services tax (GST) collections rising sharply from May. Electricity consumption rose and demand for employment under the Mahatma Gandhi National Employment Guarantee Scheme fell, suggesting better industrial demand for labour. Bank credit rose ₹32,022 crore in the fortnight ended June 5.
The government had announced a significant easing of restrictions in Unlock 1.0 that began on June 1. More easing has been announced from July 1 even though Covid-19 cases have been rising.
GST collections recovered to ₹90,917 crore in June from ₹62,009 crore in May and ₹32,294 crore in April, reflecting a rise in consumption. However, FY21 first-quarter numbers are still 41% lower than the year-earlier figure. The issuance of e-way bills, documents needed to move goods in the GST regime, rose to almost 40 million in June, just short of 40.6 million in March, indicating a sharp recovery in the movement of goods. India imposed a lockdown on March 25 to curb the spread of Covid-19.
The purchasing managers’ index for manufacturing (PMI) recovered to 47.2 in June from 30.8 in May. A reading above 50 on this survey based index reflects expansion while that below implies contraction. Indicators such as Regional Transport Office (RTO) transactions, toll collections, electricity consumption and rail freight also showed a recovery.
Source: Economic Times
