Growth momentum falters in November 2021: ICRA

New Delhi, December 17 (IANS): Rating agency ICRA on Friday said growth momentum faltered in November 2021 due to “some satiety” from pent-up demand as well as supply chain disruptions in parts of southern China. India due to untimely rainfall.

“Up to 12 of the 15 core indicators recorded a deterioration in their year-over-year performance during this month, compared to October 2021. In addition, the number of indicators exceeding their pre-Covid levels has risen to seven. in November 2021 compared to nine in October 2021.

“The first data for December 2021 is slightly positive, and coverage of the second shot looks set to reach 61% of Indian adults by the end of the month. However, it remains to be seen whether existing Covid-19 vaccines will offer protection. against the Omicron variant and avoid a third wave in India, ”he said.

The rating agency also said that amid the heightened uncertainty generated by Omicron, convincing signs of a lasting and lasting recovery have yet to emerge.

“The year-over-year performance of 12 of the 15 high-frequency indicators deteriorated in November 2021 compared to October 2021, suggesting that the growth momentum has run out of steam, with some pent-up demand satiety after the Christmas and New Year.

“On the other hand, vehicle registrations, passenger vehicle (PV) production and non-food bank credit from regular commercial banks showed modest year-over-year improvement in November 2021, compared to the previous month.”

In monthly terms, the agency said nine of 13 non-financial indicators recorded a decline in November 2021, largely reflecting the impact of a higher number of holiday-related holidays.

“In addition, heavy untimely rains in the southern states appear to have resulted in supply chain disruptions, weighing on activity in November 2021. Only PV and Coal India Lted (CIL) production, traffic Domestic airline passenger and auto retail volumes improved in November 2021, compared to the previous month. “

In addition, toll collections and retail ‘FASTag’ payments declined in November 2021, after reaching historic highs in October 2021, while mobility for retail and leisure continued to improve sequentially. “

The trend, ICRA pointed out, was mixed compared to the pre-Covid volumes of November 2019, with seven of the 13 non-financial indicators recording an improvement in November 2021 and six a deterioration.

“This is lower than the performance of October 2021, when nine of the 13 indicators were better than before Covid, the performance of motorcycle production and diesel consumption fell below the levels before Covid in November 2021 compared to above before Covid in October 2021.

“Early data from December 2021 shows that the average daily production of GST electronic invoices improved to 2.2 million from December 1 to 12, 2021 from the five-month low of 2.0 million recorded in November 2021; however, we don’t expect the October 2021 high to be broken. “

Additionally, merchandise exports are estimated to have grown 44.4 percent year-on-year from December 1 to 14, 2021, although momentum may slow down at the end of the month during the year-end holiday period.

“After a year-on-year contraction in November 2021, sales of gasoline and diesel from state refiners increased during the first half of December 2021.

“In addition, the year-on-year growth in electricity demand increased to 2.9% from December 1 to 14, 2021, compared to 2.1% in November 2021, while rail freight growth increased from 6, 1% to 5.9% year-on-year from December 1 to 10, 2021. in November 2021, “the agency said.

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