Page 144 - economic_survey_2021-2022

118 Economic Survey 2021-22

The year 2021-22 so far has been an exceptional year for the capital markets. There was
a boom in fundraising through IPOs by many new age companies/tech start-ups/unicorns.
In April-November 2021, ` 89,066 crore were raised via 75 IPO issues, much higher than
in any year in last decade.
The Sensex and Nifty scaled up to touch its peak at 61,766 and 18,477 on October 18,
2021. Among major emerging market economies, Indian markets outperformed the
peers in April-December 2021. The process of insolvency which was suspended in view
of pandemic, started again in end-March 2021. A pre-packaged insolvency resolution
process was provided under IBC as an alternative insolvency resolution process for
corporate Micro, Small and Medium Enterprises in April 2021.

MONETARY DEVELOPMENTS

4.1 The Monetary Policy Committee (MPC) maintained status quo on the policy repo rate
during April to December 2021 after a substantial cut of 115 basis points (bps) during February-
May 2020 and a cumulative 250 basis points cut since February 2019 (Figure 1 and Table 1).
The repo rate which currently stands at 4 per cent is lowest in the last decade (Figure 1). Since
May 2020, the policy rates have been on hold along with an accommodative monetary policy
stance with forward guidance that this stance will continue as long as necessary to revive growth
on durable basis while ensuring that inflation remains within the target (Consumer Price Index
inflation of 4 per cent within a band of +/- 2 per cent).

Figure 1: Repo and reverse repo rate (per cent)

9

8

7

6
per cent 5

4

3

2

1
Apr, 2011 Aug, 2011 Dec, 2011 Apr, 2012 Aug, 2012 Dec, 2012 Apr, 2013 Aug, 2013 Dec, 2013 Apr, 2014 Aug, 2014 Dec, 2014 Apr, 2015 Aug, 2015 Dec, 2015 Apr, 2016 Aug, 2016 Dec, 2016 Apr, 2017 Aug, 2017 Dec, 2017 Apr, 2018 Aug, 2018 Dec, 2018 Apr, 2019 Aug, 2019 Dec, 2019 Apr, 2020 Aug, 2020 Dec, 2020 Apr, 2021 Aug, 2021 Dec, 2021

Policy Repo Rate Reverse Repo Rate

Source: RBI