Data recap: Inflation, IPO revival, millets in diet

Vegetable woes

Retail inflation in India hit a 15-month high of 7.4% in July on account of a sharp rise in vegetable prices. If not for vegetable prices, retail inflation would have been 5.4%, implying that vegetables alone dragged up the headline figure by 200 basis points in July, a Mint analysis showed. While economists expect vegetable prices to ease over the next two months, they predict another 7%-plus print in August, posing a dilemma for the Reserve Bank of India that has held policy rates steady since April.

Who is better?

India is doing worse than China on population control measures, according to 40% of urban Indians polled in the latest round of the YouGov-Mint-CPR Millennial Survey. Half said India needs either a strict step like China’s one-child policy or some measures such as penalties or restrictions on voting rights. On certain other key measures, the verdict was in India’s favour on governance, economic growth, adoption of technology, and support to start-ups. But China was seen as doing better on employment and poverty reduction.

Large payout

₹600 crore: That’s the amount the Union government is expected to pay South Korea’s Samsung Electronics Co Ltd for the first year of the PLI scheme for mobile phone manufacturing, Mint reported. This will be the largest payout ever under the scheme, which is the first in a series of similar schemes rolled out to encourage domestic manufacturing. The mobile and electronics PLI scheme has received the largest share of incentives disbursement as of March 2023, and it is one of the most successful under the bucket of schemes under PLI.

Crude shifts

Crude oil imports from Russia nearly tripled in the first quarter of this fiscal year compared to the same period in 2022-23, making it India’s top source of crude oil by a wide margin, shows government data. India has increased its imports from Russia since last year as it offered discounted oil due to sanctions from the West over its invasion of Ukraine. While Russian oil imports increased, crude imports from other West Asian countries have decreased. In the first quarter of 2022-23, Iraq was India’s biggest source of crude oil.

IPO revival

The country’s primary market may be headed for a revival with at least 71 companies firming up plans to launch their initial public offerings (IPO) in the second half of fiscal 2023-24, according to Prime Database. Experts are upbeat about the prospects of the primary market after a lull. These companies could raise as much as $10.7 billion (or ₹89,069 crore) by selling their shares to the public and listing them on exchanges through IPOs in the coming six months. In addition, at least 30 companies have filed offer documents and are awaiting regulatory approval for their IPOs, aimed at raising around ₹38,129 crore.

Exports slump

9-month low: That’s the length of time since India’s goods exports were last recorded as low as they were in July. Exports declined 16% year-on-year to $32.25 billion owing to a demand slump, government data showed. Petroleum product exports recorded the steepest decline, followed by labour-intensive gems and jewellery exports. However, electronic goods, coffee, pharmaceuticals and iron ore exports reported an increase. Indian goods exports remained under pressure in July as demand from key markets such as the US, Europe and China remained subdued amid high inflation driven by persistent geopolitical tensions.

Growth optimism

Speaking on Independence Day, Prime Minister Narendra Modi reiterated his promise to make India the third largest economy during his “third” term. Such recent promises and projections have kept India’s economic growth narrative on cloud nine. But a closer look shows that none of these estimates imply India growing any faster than it is already growing, even if it stays in the 6-7% growth range. What matters is that this level of consistent growth won’t be enough to become a developed economy by 2047, even though it will keep India the fastest-growing emerging economy, Mint calculations show.

Chart of the week: Millets gap

Millets, once a staple in the Indian diet, are coming in vogue again thanks to growing health awareness and government campaigns. A survey by Sambodhi Research and Transforming Rural India shows that women are more likely than men to have ever had millets, but their consumption tends to be infrequent.

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