Economic indicators improve, but quarter to go down as worst in history

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Economic indicators improve, but quarter to go down as worst in history

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The worst seems to be over for Indian economy as most fast-frequency indicators show an improvement in June from the bottom they had hit in April. The economy, however, is far from reaching normalcy. April-June 2020 is sure to go down in history as the worst quarter for the Indian economy.
Story: Shivani Sharma
Design: Pragati Srivastava

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The manufacturing segment in the Index of Industrial Production (IIP) reported a steep 67.1 per cent contraction in April. The rate of contraction reduced to 39.3 per cent in May 2020, mitigating the cumulative contraction during April-May 2020 at 52.7 per cent.

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Consumption of finished steel fell YoY by 56.8 per cent during April-June 2020.

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Performance of steel and cement is used as proxy indicator by the National Statistical Office (NSO) to estimate construction GVA. Production of cement fell by 54.1 per cent during April-June 2020.

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Conventional energy generation was down YoY by 18.3 per cent in the June quarter. Power demand started declining from the month of April and continued the trend till June-end due to lockdown.

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Among mined products, coal offtake shrank YoY by 24.2 per cent in June quarter. Production of crude oil declined YoY by 22.5 per cent.

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Freight traffic volume was down 21.4 per cent to 241.55 million tonnes (mt). As much as 93.58 mt goods were transported in June compared to 101.42 mt a year ago.

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Traffic at major ports declined YoY by 19.7 per cent during April-June. Fall in June at 14.5 per cent was lower than the 21-23 per cent fall witnessed in the preceding two months.

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E-way bill generation too reported an improvement in June 2020, rising YoY by 17.7 per cent, after reporting a steep contraction of 83.6 per cent in April and 53 per cent in May. For the June quarter, e-way bill generation remained 46.1 per cent lower than its year-ago level.