Finally, some good news for the Narendra Modi government. The number of daily new coronavirus cases in the country has fallen below the 60,000 mark for the first time in almost two months.
Yesterday, India reported 59,980 new cases. This is despite the number of real time PCR (RT PCR) tests going up to 79,982,394. Policymakers and analysts said that the trend, if sustained, will lead to a push in economic activities especially in the wake of the festive season and push overall growth.
<strong>Silver lining</strong>
Already, the purchasing managers’ index (PMI) for September increased to 56.8. In August it was 52 and in July 46. The PMI, which essentially reflects trends in the manufacturing and service sectors, is considered one of the critical indicators of the economy.
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“The drop in fresh cases has been visible from the last week of September, and we hope to continue with the trend which in turn will boost the economy. There have been several positive signs, such as healthy exports and rise in car sales” a government source told IndiaNarrative.com.
A senior official at the media major Star India, who did not wish to be identified, said that the advertisers’ spends have resumed and at present it is at 80 per cent of the pre-Covid days. “Finally, after two quarters, advertisements have started picking up and we hope to surpass previous years in the coming months,” the official said.
<strong>Weak demand remains a concern</strong>
Despite the encouraging signals, overall demand continues to remain weak, sources said. Several captains of the industry have stressed the need to roll out a larger stimulus package ahead of the festive period to push crucial and job generating sectors such as housing.
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While economic activities came to a near halt in the April-to-June quarter due to the coronavirus-induced stringent lockdown, the July-September period witnessed calibrated unlocking of the economy. However, several key services sectors like hotels, hospitality, airlines and railways operated at a bare minimal level.
Analysts said that the second quarter growth numbers would also be disappointing. “However, we are hopeful that things would start picking up from the third quarter and right through the second half of 2020-21,” industry body Assocham said.
In the first quarter of the current financial year, India’s economic growth contracted by the harsh 23.9 per cent, giving rise to speculations that recovery would be a long drawn process..
