Bikky Khosla | 05 Aug, 2019
abound these days on the Indian economy losing its steam. With a
sizeable number of indicators of the consumer economy flashing red, the
concern seems to have reasonable grounds. Sales of passenger vehicles,
tractors and two-wheelers are in the red; the NBFC sector is in deep
trouble; the fast-moving consumer goods sector is in a slow lane … we
can, no doubt, sum up this situation as slowdown in growth, and the
question is whether this slowdown is temporary in nature or not.
situation has been severe in the auto sector for the last 12 months. In
the first quarter, passenger vehicle sales fell 18.4 percent, and
monthly passenger vehicle sales in June fell by the biggest margin in 18
years. A report by Federation of Automobile Dealers Associations adds
that around two lakh jobs have been cut across automobile dealerships in
India in the last three months. It is also feared that the auto parts
industry could be forced to slash a fifth of its 5 million workforce if
the slowdown continues.
weak demand situation may worsen further with slowdown in the NBFC
sector, with the RBI cracking the whip on it in the aftermath of the
IL&FS crisis. Similarly, the latest earning figures of our FMCG
majors also reflect consumption slowdown spreading fast across the
sector. Some key industry players have logged single digit growth
numbers in the last quarter, raising a big question whether or not rural
income support and MSP hikes will be enough to mitigate the impact of a
Minister Nirmala Sitharaman reviewed the performance of banks on Monday
in a meeting with top bankers. This meeting was the first of a series
of meetings that the Ministry of Finance is convening to discuss current
economic issues with key stakeholders, including some of the industry
sectors -- MSMEs, auto, real estate, home-buyers, financial market, etc.
-- whose health has been affected in recent months. This is a welcome
step. The current economic condition demands that the government
urgently comes out with all possible measures to mend the economy.
I invite your opinions.