The state of the economy apparently deteriorated in 2019 and the government in general and Finance Minister Nirmala Sitharaman in particular lost their sweat in an effort to improve it and respond to attacks of the opposition. Negative news arrived from almost every quarter while the government targeted the messenger rather than the message.
However, by the end of 2019, there had been several pieces of good news for the Narendra Modi government. Some figures from previous months may bring a smile on the face of the finance minister too.
1. Manufacturing sector, a fundamental of the economy
The biggest news was the improvement in the manufacturing sector. According to the survey “The Nikkei Manufacturing Purchasing Managers Index” of IHS Markit, a private body that came out with its report on Thursday, the country’s manufacturing sector attained a seven-month record in production in December 2019.
The index rose to 52.7% in December 2019. It was 51.2% in November of the last year. This is the highest level since May 2019. Its staying above 50 means that manufacturing is not likely to decline in the coming quarters.
2. 15% increase in FDI: External support to the economy
There was good news about the economy on the foreign direct investment (FDI) front as well. FDI inflows rose 15% to $ 26 billion during the first half of April-September of the fiscal year.
Government data revealed this detail. Foreign direct investors pumped $ 22.66 billion into India in the same half-year of the last financial year.
3. GST collection: The state of the state economy
The GST collection crossed Rs 1 lakh crore for the second consecutive month. The GST collection in December 2019 was Rs 1,03,184 crore.
Earlier in November 2019, the GST collection was a total of Rs 1,03,492 crore. GST collection was Rs 95,380 crore in October 2019 and Rs 91,916 crore in September.
4. Relieving news from the auto sector
There was good news in December 2019 for the auto sector, which has been facing a recession for almost a year. Sales of Maruti, Mahindra and MG Motors jumped last month.
Mahindra’s domestic vehicle sales rose by 1% in December.
MG Motor India has sold 3,021 units of Hector in the month of December.
5. Air India’s international income rises
The condition of Air India has been bad for a long time. The government and economists have warned on many occasions it is not sustainable and so the state must disown it. However, at the beginning of the new year, the airlines gave good news.
Air India got the benefit of the shutdown of Jet Airways. In the eight months from April to November of this financial year, Air India’s revenue on international routes increased by 20%.
6. FASTag doubles toll tax collection
It will be mandatory to pay toll tax using FASTag rather than by cash, beginning 15 January, on the country’s highways. The good news is that the transactions from FASTag almost doubled in December as compared to November 2019.
The deadline for acquiring a FASTag for every car to use the highways was initially 1 December 2019, but the inability of many car owners to do so made the government extend the last date to 15 January.
According to data from the National Payments Corporation of India (NPCI), the total transaction from FASTag was Rs 1,256 crore in December, compared to Rs 774 crore in November last. There was a transaction of Rs 703 crore that month.
7. Transactions from UPI: Towards digitised economy
On the digital transaction front too, the Modi government gave the people some good news. On the Unified Payments Interface (UPI), transactions increased to Rs 2 lakh crore in December.
UPI had started in the year 2016. For the first time, it has seen transactions worth over Rs 2 lakh crore.
December 2019 saw a total transaction of Rs 2,02,506 crore on UPI. In November last, there were transactions worth Rs 1.89 lakh crore from UPI.
The significance of this achievement can be understood from the fact that almost the same volume of transactions was seen through the Immediate Payment Service (IMPS) system of banks. In December, transactions worth Rs 2.1 lakh crore were recorded on the intermediate payment service of the Inter-bank Electronic Funds Transfer System. This is a big step towards seeing a largely digitised economy.