Page 396 - ES 2020-21_Volume-1-2 [28-01-21]
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State of the Economy 2020-21: A Macro View  23


             irrigation via PM Krishi Sinchai Yojana, micro-irrigation scheme, promoting economies of
             scale through FPOs, and institutionalizing e-NAM (Electronic national agricultural market),
             and promotion of agricultural mechanization through subsidies and custom hiring centres,
             have contributed to nourishing a vibrant agricultural sector, which remains a silver lining to
             India’s growth story of FY 2020-21.


             1.28  A palpable V-shaped recovery in industrial production was observed over the year.
             Manufacturing rebounded and industrial value started to normalize. Headwinds, however,
             lingered on. The index of eight core industries, which make up around 40 per cent of the index,
             registered a growth of (-) 2.6 per cent in November, 2020 as compared to a growth of 0.7
             per cent in November, 2019 and (-) 0.9 per cent in October, 2020 (Figure 24). Consequently,
             IIP, after registering positive growth in October 2020 slipped back into contractionary zone
             in November, 2020 (Figure 25). PMI Manufacturing, however, continued to remain in
             expansionary zone in December 2020. Resuscitating steel consumption reinforced acceleration
             in construction sector, propping up employment as economy unlocked. The housing market, a
             key forward linkage sector for steel consumption, saw gradual resurgence from its Q1: 2020-
             21 trough. Electricity sector retained its momentum with power consumption registering
             positive YoY growth since September, 2020.


                    Figure 24: Growth in Core Index                   Figure 25: Growth in IIP

                    Coal                    Crude Oil           Mining     Manufacturing  Electricity  IIP
                    Natural Gas             Petroleum Ref. Products  10
                    Fertilizers            Steel
                    Cement                 Electricity        0
                    Overall Index
                10                                          -10

                 0                                          -20
                                                            cent  -30
               Growth (%)  -10                              Per  -40

                -20
                -30                                         -50
                                                            -60
                -40                                         -70
                     Jan/20  Feb/20  Mar/20  Apr/20  May/20  Jun/20  Jul/20  Aug/20  Sep/20  Oct/20  Nov/20  Jan/20  Feb/20  Mar/20  Apr/20  May/20  Jun/20  Jul/20  Aug/20  Sep/20  Oct/20  Nov/20


             Source: MoSPI, DPIIT

             1.29  Revitalized inter and intra-state movement along with a sustained spurt in industrial and
             commercial activity heralded the economy’s returning to normalcy. E-way bills, electronic
             toll collection, rail freight and port cargo traffic not just recovered but surpassed previous year
             levels in Q3: 2020-21, while rail passenger earnings and domestic aviation witnessed a steady
             recovery (Figures 26 and 27). Indian services sector sustained its recovery from the pandemic
             driven declines with PMI Services output and new business rising for the third straight month
             in December.
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