NEW DELHI: With the situation in West Asia improving and oil prices falling, govt expects a pick-up in the economy, amid economic indicators pointing to a strong momentum in first quarter.“The economic indicators released by the govt continue to underline resilience of Indian economy despite global uncertainties. Strong GDP growth, expanding manufacturing and services activity, record vehicle sales, healthy GST collections and resilient exports indicate that domestic demand and investment remain robust,” said an official, although a weaker monsoon may impact the calculations to a limited extent.There was tremendous uncertainty at start of the first quarter with energy, fertiliser and petrochemical supplies affected and prices rising, with a weaker rupee adding to pressure. Shipping was hit hard, hurting overseas trade.While the Indian economy grew 7.7% last year, it is projected to expand at over 6.6% in current financial year, with govt officials predicting faster expansion. Advance indicators, such as GST collections, which rose 14% in June, factory output and PMI pointing to expansion.Auto sales have been strong and electricity demand rose 11.2% in May, indicating a strong economic activity, after a sluggish April. Port traffic also made a recovery, rising over 6%, pointing to signs of normalcy.Govt has sought to sustain capex, ensuring strong investment in infrastructure. During April-May, capital expenditure stood at Rs 2.5 lakh crore, 12% higher with railways leading the charge. The state transporter spent over Rs 84,000 crore in April and May, which is 30% of its annual capex, with money flowing into safety upgrades, signalling, train protection systems, new lines, gauge conversion and doubling of lines.“This means infrastructure spending is being front-loaded. Early spending helps speed up projects, improve execution, and support demand in sectors linked to construction, steel, cement, transport, logistics and equipment,” said an official.
