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WPI Inflation
WPI- based inflation fell to 11.16% in July from 12.07% a month ago. India’s wholesale price index based inflation eased in July but remained in double digits for the fourth consecutive month, as fuel and food inflation moderated even as inflation of manufactured items picked up.
The WPI has remained in double digits for a fourth consecutive year on a low base effect. The prices of crude, natural gas, metals and food has rose compared to last year. With the receding impact of covid and related lockdowns the inflation is ought to cool by the year end
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Govt revises PLI scheme guidelines for white goods
The PLI Scheme for white goods which was approved in April was aimed at creating a global supply chain in India with a budgetary outlay of Rs. 6238 crores. Further the scheme now allows inclusion of more LED components such as resistors, fusers, among the eligible products.
To maintain the efficiency of the supply and manufacturing the government further plans to levy penalty if a company fails to make full committed investment and leaves midway, such companies will have to refund the incentives along with the interest.
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India Inc’s credit outlook turns positive
Crisil Ratings upgraded its credit quality outlook for India Inc for FY 22 to “positive” from “cautiously optimistic” on the back of a sustained recovery in demand. 28 sectors of the 43 sectors in consideration are set to witness a recovery in demand back to pre-pandemic levels signaling a broad-based recovery
The increase in coverage of vaccines should also mitigate the impact of a third wave if it comes. Strong economic growth, both on the domestic and international front also aid the positive outlook going forward. Sectors with the most rating upgrades have been construction & engineering, steel, other metals, renewable energy, pharmaceuticals and specialty chemicals.
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Rising global prices brighten prospects for Indian sugar exports
Firmed-up global prices have brightened the prospects of sugar exports from India for the 2021-22 marketing year starting October, even without the government subsidy. Mills have also exported some quantities of sugar this year under the open general license (OGL) category without availing the government subsidy in view of rising global rates.
The recent sugar production data from Brazil also points at further contraction in the country’s volume for the season. This occasioned the Indian traders signing sugar export contracts for 2021-2022 in advance, even before the start of the season unlike earlier times.
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Exports rises 50% in July, imports surge 63%
Merchandise exports surged 50% in July from a year before and 35% from the pre-pandemic level (July 2019), as orders from key western markets poured in and global commodity prices remained elevated.
The rise in exports has been in sync with the country’s export target of $400 billion for FY22, almost 33% of the annual target has been met in the first four months of the year. Exports in gems & jewellery, cotton yarns, fabrics, electronics and engineering goods have seen a boost
