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Initial high frequency indicators for February 2022 suggests a quick rebound in India's economic activity, ratings agency ICRA said on Thursday.

As per the agency, the expected trend in February 2022 is based on the pick-up in generation of GST e-way bills, electricity demand, fuel sales, amongst others.

"These trends suggest that non-agri, non-government economic activity will stage a quick rebound after the subsiding of the less severe third wave," it said.

The expected trend comes after the emergence of the third wave of the Covid-19 pandemic in India which temporarily interrupted the momentum of economic activity in January 2022.

Performance of 10 of the 16 high-frequency indicators deteriorated YoY in January 2022 compared to December 2021.

"While the performance in January 2022 on a month-on-month (MoM) basis was mixed, the adverse impact was largely concentrated in contact-intensive services, mobility and payments," the agency said.

"Encouragingly, the industrial sector indicators appeared relatively insulated from the third wave, with a sequential rise in coal and auto output, and electricity and a very mild dip in GST e-way bill generation."

According to ICRA, a larger number of sectors slipped below the pre-Covid volumes of January 2020- the number of indicators exceeding their pre-Covid volumes slipped to eight in January 2022, from 10 in December 2021.

"The output of PVs and motorcycles reverted to below pre-Covid levels in January 2022 from above pre-Covid in December 2021."

"Following the rapid abatement of the third wave, early data for February 2022 is positive. The daily average generation of the GST e-way bills rose to 2.36 million during February 1-13, 2022 from 2.22 million seen in January 2022, within striking distance of the record-high generation of 2.37 million seen in October 2021."