India’s Economic Growth Highlights, June 2024

In June 2024, India’s economic landscape witnessed significant growth driven by robust performance in both manufacturing and services sectors. The Purchasing Managers’ Index (PMI) for manufacturing soared, accompanied by strong hiring activity, marking a 19-year high. Concurrently, the Eight Core Industries Index expanded by 6.5% year-on-year in the initial months of FY25, led by sectors like coal and electricity.

Manufacturing Sector

Steel demand surged with double-digit growth, fueled by heightened activity in real estate, which saw home construction peak in major cities. Conversely, auto sales faced challenges, declining due to adverse weather and base effects despite attractive OEM discounts.

Services Sector

The services sector excelled, particularly in digital payments, underscoring India’s global leadership. Sales in both IT and non-IT services grew significantly year-on-year, driven by robust domestic demand and favorable inflationary conditions.

Power Consumption and Digital Payments

Power consumption spiked by 9% year-on-year, reaching 152.4 billion units, driven by prolonged heat waves and increased industrial activity. Unified Payments Interface (UPI) transactions maintained around Rs. 20 trillion in value, highlighting India’s resilient digital payment ecosystem.

Outlook

The symbiotic relationship between manufacturing and services sectors is poised to strengthen India’s economic resilience, supported by strategic sectoral alignments and robust domestic demand dynamics. As India enters FY25, continued collaboration between these sectors promises sustained growth across various economic fronts.