We will unpack the RBI’s latest November 2024 Bulletin, which has some interesting insights into India’s economy and seasonal trends in key indicators.

The News

On 20th November, the RBI released its over 200-page long November Bulletin, providing an in-depth analysis of India’s economic resilience, rising inflation, evolving communication strategies, and booming agri-tech ecosystem.

Though it highlights many things, here’s a breakdown of the key aspects of this report.

State of the economy

In India, things slowed down between July and September, but the festive season brought back spending, and activity is picking up again.

Inflation is a concern. The RBI aims to keep it between 2% and 6%, but in October, it hit 6.21% due to higher food prices and other rising costs.

Despite these challenges, India’s economy is expected to stay strong in the long run, thanks to solid demand and good policies on the lending side.

For instance, the ratio of bad loans out of total loans has reduced to just 2.7% at the end of June 2024, which was highest in 2018, over 11%.

Indian Exports & Imports

Services exports have remained buoyant and rose by 11.0% during the first six months of FY25 (v/s 4.8% in the first six months of FY24).

India currently holds 13% or a sixth of the global market share in petroleum products, attesting to rising refining capabilities and the ability to meet international standards.

India is also the largest exporter of precious and semi-precious stones, the third-largest exporter of insecticides, the eighth largest in rubber pneumatic tyres, and the ninth in semiconductors.

In the first half of FY25, Apple exported close to $6 billion of India-made iPhones, while automobile exports expanded by 14.3%, led by passenger vehicles and two-wheelers.

During the April-October 2024, India’s merchandise imports stood at $416.9 billion, increased by 5.8% (y-o-y), mainly led by petroleum, oils, and lubricants, electronic goods, gold, non-ferrous metals, and machinery.

Leading the AI adoption:
RBI report also highlights that AI itself could increase global GDP by $7-10 trillion over the next three years.

Large language models (LLM) such as ChatGPT and Google’s Gemini are estimated to increase the productivity levels of workers by 8–to–36%.

Interestingly, as per the Boston Consulting Group (BCG), 30% of Indian companies are maximizing the value of AI, which is higher than the global average of 26%.

Seasonality in Economic Indicators

Factories produce the most in March, boosting a real GDP in the January–March quarter. But items like consumer durables (e.g., appliances and electronics) see the highest sales in October during the festive season.

Seasonal trends in most economic factors remain steady, but cash availability, demand deposits, car sales, and exports, are showing bigger seasonal changes.

To Conclude

The RBI’s November Bulletin offers a compelling snapshot of India’s economy. Despite the challenges, the medium-term outlook seems positive, thanks to strong fundamentals like steady demand and better macroeconomic policies.

For those tracking India’s economy, these updates emphasize the importance of staying informed about evolving trends and challenges.