The Signal (weekly highlights)

1. Fiscal deficit touches 21.2% of BE by June 2022

Central Government’s gross fiscal deficit (GFD) touched 21.2 per cent of its annual budgeted target during the first quarter of 2022-23. At the same time last year, the government had exhausted 18.2 per cent of its annual deficit target. In absolute terms, the deficit during April-June 2022 amounted to Rs.3.5 trillion, considerably higher than the last year’s Rs.1.7 trillion.

On the revenue side, net tax collections rose by 22.6 per cent to Rs.5.1 trillion during April-June 2022. Non-tax revenue receipts declined by 51.2 per cent to Rs.621.6 billion, while non-debt capital receipts, which mainly comprise of disinvestment proceeds, increased by 278 per cent to Rs.279.8 billion.

2. Output of eight core industries rises by 12.7% in June 2022

The index of eight core industries rose by 12.7 per cent on a year-on-year basis in June 2022. The growth was lower than the 19.3 per cent growth registered in the preceding month. Seven of the eight core industries reported a rise in production, while one reported a fall. In June 2022, electricity generation rose by 15.5 per cent and output of coal, which is a key input for thermal power generation, increased by 31.1 per cent.

Among other energy sources, output of crude oil fell by 1.7 per cent, but that of natural gas and refinery products rose by 1.2 per cent and 15.1 per cent, respectively. Steel production grew by 3.3 per cent and cement production grew by 19.4 per cent. Production of fertiliser, which traditionally has been the smallest contributor to the eight core industries’ output, increased by 8.2 per cent in June 2022.

3. Passenger traffic by air rise 288.1% in June 2022

Total passenger traffic by air went up by 288.1 per cent to 25.2 million passengers in June 2022. In June 2021, airlines carried a total of 6.5 million passengers. Domestic passenger traffic jumped by 247.9 per cent y-o-y to 20.8 million passengers in June 2022.

Passenger traffic by air surged by 226.3 per cent y-o-y to 76.4 million passengers during April-June 2022. Domestic passenger traffic increased by 206.2 per cent y-o-y to 64.4 million passengers. International passenger traffic went up by 403.3 per cent y-o-y to 12 million passengers.

4. Centre’s capex outlay for April-June 2022 pegged at Rs. 1.5 tn

The Centre’s capital expenditure (capex) outlay for the April-June 2022 quarter is estimated to be around Rs.1.5 trillion, a government official told Business Standard. During April-June 2021, capex came in at Rs.1.1 trillion, around 20 per cent of the Rs.5.5 trillion capex target for full fiscal year 2021-22

The government official expects that as a percentage of full-year capex budget estimate (BE) of Rs.7.5 trillion for 2022-23, capex outlay during the first quarter will be at similar levels to the trends in the past few fiscal years.

5. Manufacturing sector sees 76% rise in FDI in 2021-2022

Foreign direct investment (FDI) equity inflows in the manufacturing sectors increased by 76 per cent in 2021-22 to USD 21.3 billion as compared to USD 12.1 billion in 2020-21, as per the Ministry of Commerce & Industry.

The ministry stated that despite Covid-19 pandemic and global developments, India received the highest annual FDI of USD 84.8 billion in 2021-22. Singapore emerged as the top sourcing nation with a contribution of 27 per cent, followed by the United States (US), Mauritius, The Netherlands and Switzerland.