Thread by @Funter21510910

State of the Economy through Charts and Tables

As the GDP growth (at 5%) slowed to a 25 quarter low in Q1 of FY 2020, let us examine the various economic indicators to understand the 'real' state of the Indian economy. Here is a thread. 1/13

1) 2-Wheeler Sales - dipped by ~17% in July, 2019. Motorcycle sales fell by 19% while Scooter sales declined by 12%. Scooters sell more in urban India. Motorcycles sell in both urban as well as rural India. The data shows distress in both India and Bharat. 2/13

2) Car sales - saw a massive YoY volume degrowth of 30.3%. Car purchase is a discretionary spending. People buy cars only when they are assured of future economic prospects. It shows that urban economic sentiment is at rock bottom levels. 3/13

3) Tractor sales - domestic tractor sales dropped by 12%, tractor production dipped by 4.6% and tractor exports declined by 2.5% in July 2019. This is a sign of the agricultural distress. 4/13

4) Commercial Vehicle Sales - witnessed a YoY downfall of 25.71% in July 2019. This is quite ominous as CV sales are considered a lead indicator of industrial as well as infrastructure activity. 5/13

5) Trends in retail lending - it is a mixed bag. While the overall retail loan growth of banks is ~17%, the discretionary spending on consumer durable shows a massive decline of ~72%. These numbers could be misleading as some NBFC portfolio could have shifted to banks. 6/13

6) Core sector growth - four sectors — crude oil (-6.8 per cent), natural gas (-2.1 per cent), refinery products (-9.3 per cent) and cement (-1.5 per cent) — saw a sharp contraction in June 2019. This confirms a slowdown in industrial activity. 7/13

7) GST collection - dropped below Rs 1 lakh crore mark to Rs 98,202 crore in August, 2019 (from Rs 1.02 lakh crore in July 2019). Though this number is higher YoY, it is indicative of a slowdown this year. 8/13

8) PMI Index - PMI Index, which maps both manufacturing and services industry, touched an eight-month high of 53.9 in July from 50.8 in June, 2019. A figure above 50 denotes expansion in business activity. This indicator paints a picture contrary to other indicators. 9/13

9) Consumer Confidence Index - As per this RBI survey in July 2019, "Consumers’ perceptions on the general economic situation and the employment scenario softened, while their assessment of their own incomes turned out to be less optimistic than in May 2019". 10/13

10) Business Expectations Index - fell to 112.8 in August, 2019 from 113.5 in the previous quarter. This means that companies in the manufacturing sector are less optimistic about the current business environment, as well as future prospects. 11/13

Overall, the economic indicators warn us of a prolonged economic slowdown. Urgent measures are required from the government to arrest this free fall. 12/13

Source
1) Business Standard
2) Mint
3) Economic Times
4) Moneycontrol
5) Business Line
6) Auto Pundit
7) Trading Economics
13/13

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