GREEN SHOOTS

 

 

 

THAT 11 out of 23 industry groups have shown a positive growth during January 2020 over the same period last year, appears to be the sign of visible green shoots in the manufacturing sector. This could get accelerated further with the pick up in demand from the agricultural sector. Power, mining activity and some uptick in manufacturing could be signs of the economy entering the recovery phase. However, such a recovery path is riddled with hurdles placed in the economic growth by the dark shadow of pandemic as it is likely to slow down economic activity and hits demand. This was the time when India was expecting a rebound in the economy. But the global spread of Coronavirus has hit economic activity hard all over the world. As a result the Indian Government is staring at a possible shortfall in meeting its tax collection and disinvestment targets. This could have long term impact on the economic growth. The silver lining for the Government is that as a result of global meltdown in oil prices the Current Account Deficit has been substantially reduced.