According to the Finance Ministry, further demand stimulation, fuller restoration of supply chains and greater employment generation are in the pipeline in the coming months. This is attributed to the COVID-19 vaccination drive making further headway and teeming festivities lending credence to the ongoing economic recovery. The ministry is also expecting an investment revival and exports to pick up on account of an industrial resurgence in advanced economies. This is on account of an industrial resurgence in advanced economies.
Image credit: PIB
The ministry added that there was an almost 20% jump in capital goods output in August, as revealed by the latest industrial production data, portends a surge in investment. It also said that the recent cut in excise duties on petrol and diesel (by Rs 5 and Rs 10 per litre, respectively) by the Centre will soften the inflationary pressure, which has already started coming down. The ministry was, however, concerned that core inflation, which reflects hardening of input costs and ripple effects of escalating global crude oil prices, poses concerns. “Yet, these concerns have not embedded themselves in self-fulfilling inflationary expectations as seen in RBI’s inflation survey,” it added.
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