Slow economic recovery on track
The month of August shows the slow economic recovery, which is the business cycle stage following a recession characterized by a sustained period of improving India’s business activities. Usually, Gross Domestic Product (GDP)grows during an economic recovery, income rises, unemployment falls, and the economy rebounds.
The current situation in economic recovery
In August, economic recovery in India remained on track, with goods and services from all the tax collections staying over RS.1 lakh crore while automakers sold more cars than in the year-earlier despite a semiconductor and parts shortage.
Demands of petrol & diesel
From July, data released by India’s national payment corporation on Wednesday showed greater adoption and more economic activities. Petrol and Diesel demands rise by 14% and 16%, respectively.
Railways have taken 16.9% more freight, and electricity demand increases 18.6%, suggesting more significant movement of goods. People in the just month unified payment interface (UPI) transactions increased 9.6% to 3.55billion.T
Indian money market due to recovery
In the Indian money market, there is a segment of the financial market in India where borrowing and lending of short-term funds take place. The maturity of the money market instrument is from one day to one year. In India, this market is regulated by both RBI(the reserves bank of India)SEBI (the security and exchange board of India).
Factory manufacturing index
Factory activity moderated slightly, with the manufacturing purchasing managers index(PMI) declining to 52.3 from 55.3 in July. Looking ahead, high-frequency data suggest that a swift recovery from the second wave lows is already underway, which supports a sequential rebound.
India’s gross domestic product (GDP)grew 20.1% in the June quarter, helped by the low base of Last year’s data released on Tuesday. In GDP rate other than benefitting from the 24.4% decline in the same quarter a year ago. In nominal terms, without adjusting for inflation, the economy grew 31.7% in the period.
Hiring activity in India has been on a steady recovery and the hiring rate in July this year was around 65% above the pre- covid level, a report said according to the LinkedIn India labour market update July 2021, there was a deepening hiring dip in April 2021, corresponding to the second wave of covid -19 cases in India since then, it has been recovering steadily.
Compared to the pre – covid levels in 2019, the hiring rate was 35% higher at the end of May 2021,42% higher at the end of June 2021, and now 65% higher at the end of July 2021. when the rate of recovery from covid cases increases, only India’s GDP’s speed will increase. Because all labours, workers, employees are at home due to lockdown. So no business activities are conducting at a level of a standard form. Therefore this is the reason behind the slow recovery rate.
Tax pay problems in India
Many people are not paying taxes due to this GDP rate is decreases in India. Mainly middle-class people and upper-class people. Because demands are more than consumption, consumers are more than supply. The government needed financial support from tax way, but people didn’t support it.
Employment is the main problem of India, and many people are living in India without employment, in other words, unemployment in India. Poor people are paying taxes. On the other hand, reach people are not paying to their level of taxation. Because of that Indian economic recovery rate is too slow.