As the world turned a leaf of a year, beyond the crushing grasp of the pandemic of two years before it, and ushered in 2023 with lots of hope, and fears, one thing stood out globally — the state of the Indian economy. With great conviction did Prime Minister Narendra Modi walk along the talk, often taking humongous risks and rejecting wisdom of the chorus of experts, refusing to fall for the temptation of easy money or huge handout bailouts, and instead, spent large chunk of state revenues on universal vaccine programme, free rations for over 800 million people for years, and let infrastructure building and reforms get the thrust of priority.
The Indian economy might have been caught in the tailwinds, but the truth is Prime Minister Modi’s view seems to have been proven right, against those of most global experts.
The economy today is strong, healthy and looking upwards. The most important revenue source, indirect tax based on consumption, the Goods and Services Tax (GST) collections grew by 15 per cent to nearly Rs. 1.5 lakh crore in December 2022, over a year ago. The GST collections were steadily above the Rs. 1.4 lakh crore mark for most part of the previous year.
The Corporate tax collections exceeded three per cent of GDP, or Rs. 7.12 lakh crore, after a gap of two years, reflecting overall improvement in profitability of India Inc., propelled by an increase in demand, which was widespread and across domains.
Another crucial consumption point — car sales — jumped by 23 per cent to a record of 37.93 lakh units in 2022 against 30.82 lakh in 2021.
Petrol sales soared 8.6 per cent to 2.76 million tonnes and diesel posted a 13 per cent rise in sales in December to 7.3 million tonnes as increased consumption in farming helped build on the momentum generated by the festive season.
India’s power consumption logged a double-digit growth of over 11 per cent to 121.19 billion units in December last, compared to a year ago. This robust growth indicates sustained momentum of economic activities in December.
New supply of residential properties rose 51 per cent last year to 3,57,635 units across seven major cities as builders launched more projects to tap rising demand. The Sensex and the Nifty gained for a seventh year in a row, and outperformed other major indices in Asia by a wide margin. Indian Sensex and Nifty were among the best performing markets worldwide, with Sensex posting 4.44 per cent annual return, surpassed at 4.69 per cent gain only by Brazil’s Bovespa stock index. Gold prices appreciated over 14 per cent in Indian market despite remaining flat internationally. With a sharp upturn in industrial output, India’s manufacturing PMI scaled a new high of 57.8. The country witnessed an overall demand conducive of growth and manufacturers finished the years on an optimist note. India saw emergence of 21 unicorns this year, 18 of which were minted in the first six months. Private equity and venture capital funds invested $46 billion, but it was lower than last year.
With continuing reforms, massive investments in infrastructure and privatisation, Modi has led the Indian economy better than almost all countries in the world. There is only one worry, a big one, for a young nation — unemployment.