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Economic activity has shown an uptick once again in June 2022 after a decline in May 2021 caused by the impact of geo-political developments, said Mr Pradeep Multani, President, PHD Chamber of Commerce and Industry, in a press statement issued here today.

The PHDCCI Economy GPS Index for June 2022 has increased to 136.6 as compared to 128.0 in May 2022, said Mr Pradeep Multani.

PHDCCI Economy GPS Index captures the momentum in supply side business activity through growth in GST collections, demand side consumer behaviour through volume growth in passenger vehicle sales and sensitivity of policy reforms and impact of domestic and international economic and business environment through the movement of SENSEX at the base year of 2018-19=100, said the Industry Body.

Passenger vehicles growth, which is a significant demand indicator in GPS index, has recorded a sequential growth of 27.7%, increasing from 2,51,052 units in May 2022 to 3,20,679 units in June 2022, said Mr. Pradeep Multani.

The gross GST collections in June 2022 increased to Rs. 1,44,616 crore and has recorded a sequential growth of 2.6% in June 2022 as compared to Rs. 1,40,885 crore in May 2022, said Mr. Pradeep Multani. 

Though, the sequential growth of SENSEX (average of daily close) has decreased by (-)1.8% in June 2022 from 54437 points in May 2022 to 53478 points in June 2022, said Mr. Pradeep Multani.

Economic recovery so far (Sequential)

The PHDCCI Economy GPS Index at 136.6 for June 2022 is higher by 29.1 points from the Economy GPS Index for June 2021 at 107.5, said Mr. Pradeep Multani.

 Economic recovery so far (Y-o-Y)

PHDCCI Economy GPS Index has shown sharp recovery from the lows of 39.6 for April 2020 to 123.7 for April 2021, 91.5 for May 2021 as compared with 50.1 for May 2020, 107.5 for June 2021 as compared with 75.1 for June 2020, 119.7 for July 2021 as compared with 85.6 for July 2020, 116.7 for August 2021 as compared with 90.5 for August 2020, 113.1 for September 2021 as compared with 100.2 for September 2020, 127.0 for October 2021 as compared with 109.6 for October 2020, 125.2 for November 2021 as compared with 106.9 for November 2020, 123.5 for December 2021 as compared with 111.9 for December 2020, 133.2 for January 2022 as compared with 118.5 for January 2021, 129.8 for February 2022 as compared with 118.8 for February 2021, 133.6 for March 2022 as compared with 123.0 for March 2021, 140.6 for April 2022 as compared with 123.7 for April 2021, 128.0 for May 2022 as compared with 91.5 for May 2021 and 136.6 for June 2022 as compared with 107.5 for June 2021.

Chart-1: Composite Index of 3 broad economic indicators from April 2020 to June 2022; Using base 2018-19=100

Although, the pace of economic activity is expected to become normal on the back of various structural reforms undertaken by the Government during the last 2 years, continued handholding by the Government is required to mitigate the impact of recent geo-political developments while maintaining a balance between inflation and economic growth, said Mr. Pradeep Multani.

Chart-2: Composite Index of 3 broad economic indicators from July 2018 to June 2022; Using base 2018-19=100

PHD Chamber of Commerce and Industry (PHDCCI) Economy GPS Index is a composite index of 3 lead economic and business indicators with base year at 2018-19=100, which measures the broad economic and business activity. The PHDCCI Economy GPS Index, based on the monthly values of three high frequency indicators viz., GST collection (Rs. Crore), Passenger Vehicle Sales (units) and SENSEX (daily average), helps to find the direction of the economy. The three broad indicators represent not only demand and supply in the economy but also revenue growth of the government and movement of financial markets in the country. GST collections indicate the momentum of business activity, passenger vehicle sales is a broad indicator of demand activity in the economy and movement of SENSEX indicates the mood of both domestic and foreign investors.

Movement of Economy GPS over the Months

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