Economy Watch

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Economy Watch provides an in-depth review of salient developments in India’s macroeconomy and economic policy in a global context.
It has established itself as a thought leadership publication, providing valuable inputs for policymakers in the central and state governments, academicians, industry and businesses and other stakeholders.

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Economy Watch was launched for public distribution soon after demonetisation in December 2016. Since then, nearly 40 issues have been published.

It covers various macro-fiscal dimensions of the Indian economy including growth, inflation, government finances, external trade, monetary and financial sectors. It places India in a comparative economic framework using selected developed and developing countries.

Two innovative indices have been developed to capture changes in aggregate demand and macroeconomic imbalances in the Indian economy. The analysis in the Economy Watch is based on monthly, quarterly and annual data sourced from national and international sources.

Every month, a focused theme of contemporary economic importance is identified for a deep and insightful analysis which provides useful inputs and recommendations.

Key highlights of August 2020
  1. IIP contracted at a slower pace of (-)16.6% in June 2020 as compared to (-)33.9% in May 2020.
  2. PMI manufacturing fell to 46.0 in July 2020 from 47.2 in June 2020.
  3. CPI inflation climbed to 6.9% in July 2020 from 6.1% in June 2020 due to higher food and fuel prices.
  4. In its August 2020 monetary policy review, the Monetary Policy Committee retained the repo rate at 4.0% while maintaining an accommodative policy stance. 
  5. Center’s capital expenditure grew by 40.1% during 1QFY21 as compared to a contraction of (-)27.6% during the corresponding period of FY20.
  6. Center’s gross taxes contracted by (-)32.6% in 1QFY21 as compared to a growth of 1.4% in 1QFY20.
  7. Due to subdued demand, average credit growth fell to 6.4% in 1QFY21 as compared to 7.1% in 4QFY20.
  8. Merchandise exports and imports contracted by (-)10.2% and (-)28.4% respectively in July 2020 reflecting a continuing demand slowdown.
  9. The OECD projected a global contraction of (-)6.0% in 2020 in the ‘single hit’ scenario and (-)7.6% in the ‘double hit’ scenario where the latter assumes a second COVID outbreak. 

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