Monthly Summary for Cabinet February 2024

A-45O 1 1 / 03/ 2O24-Cootd,.ll Government of India Ministry of Flnance (Department of Economlc Alfairsl *** New Delhi, O5th Apr:,l, 2024 OFFICE MEMORANDUM The undersigned is directed to circulate herewith the unclassified portion of Monthly Summary on important policy decisio s in respect of Department of Economic Affairs for the Month of February, 024 usruta S Deputy Secretary to the t of Inida Te1 No. 2309- 5244 To 1. A11 Members of the Union Council of Ministers, Gove ent of India, New Delhi. 2 Vice Chairman, Niti Aayog, Yojna Bhawan, New Delh a Cabinet Secretary, Cabinet Secretariat, Rashtrapatr havan, New Delhi. 4 Secretary to the President of India, Rashtrapati B , New Delhi. 5 Secretary to ttre Vice-President of India, 6, Maulana a\zad Road, New Delhi. 6 Principal Secretary to the Prime Minister, PMO, South Block, New Delhi 7 Chairman, Union Public Service Commission, Dholp{rr House, New Delhi. 8 AII Members of Niti Aayog, Yojna Bhawan, New Delhi. 9 Secretaries to all the Ministries/Departments, Government of India, New Delhi. 10. PS to MOS (F), PPS to Finance Secretary, PPS to Secretary (EA), PPS to Secretary (Revenue), PPS to Secretary (Expenditure), PPS to Secretary (DTPAM). 11. Shri V. Anantha Nageswaral, Chief Economic Adviser, DEA. 12. Additional Secretar5z, Cabinet Secretariat, Rashtrapati Bhavan, New De1hi. 13. Shri Manoj Sahay, AS&FA(Finance).14. Ms. Aparna Bhatia, Advisor(Admn./Coord./ C&C ) 15. Ms. Marisha Sinha, AS(OMI/Crypto assets ald Fund Bank) 16. A11 Heads of Divisions in Department of Economic Affairs. JS(IPP/JsqSD) /JS(lnv) /JS(Budget)JS(FM)/A11 Advisers/ CAAA t7. Shri Rajesh Malhotra, DG (M&C), M/o Finance, North Block, New Delhi. 18. Guard Fiie - 2024.A-45O 1 1 /03/ 2O24-Coot d,ll Government of India Minlstry of Flnance (Department of Economlc Alfalrsl Subject: Monthly Summary on important pollcy declslons pertalning to Department of Economlc Alfalrs (DEA) for the month of February, 2O24. Important pollcy decisions taken and major achievements during 1 the month: Macroeconomic Overview: Second Advance Estimates of National Accounts proJects India's real GDP growth at 7.6 per cent for Flnanclal Yeer 2O23-24 lFV24l. This is higher than the 7.3 per cent growth projected by the NSO in the first Advance Estimates released in Januar5r, 2O24. Stronger growth in the third quarter (Q3; at 8.4 per cent) has increased the full-year real GDP growth in FY24. Following the release of the December 2023 quarter GDP data, several professional forecasters have revised their GDP growth projections for FY25. State Bank of India revised its growth projection to 8 per cent, compared to 7 per cent in its previous estimate. Simiiarly, Barclays raised their projection from 6.5 per cent to 7 per cent. The NITI Aayog estimates that, as per the Household Consumptlon Expendifire Surueg (HCES) for August 2022 to Jnlg 2023, poverty has come down to five per cent, lndlcating that people are becomlng more prosperoua both ln rural and urban areas. The HCES highlights that monthly per capita household consumption expenditure (MPCE) more thal doubled in 2022-23 as compared to.2Ol7-12. The average estimated MPCE in 2022-23 stands at 13,773 in, rural India and t6,459 in urban India. This decline in poverty is attributed to government programmes targeted at those at the bottom of the pyramid. Retail lnflation decllned to a three-month low of 5.1 per cent ln January, 2024. The falt in inflation in January, 2024 rs due to both the food and core (non-food, non-fuel) components. Core inflation continued to deciine for the eighth consecutive month, from 5.2 per cent in May, 2023 to 3.5 per cent in January, 2024. Food inflation declined compared to the previous two months but has still to come down further. Most food items saw a decline ininflation in Jaluary, 2024. OveraJl, inflationary pressures moderated in the frrst lO months of FY24, with retail inflation easing to 5.4 per cent, compared to 6.8 per cent in the same period of FY23. The flscal deficit ofthe central government was 63.6 per cent ofthe revlsed estimates (RE) during Aptil 2O23 - January 2024, lowet than 67.8 per cent of RE durlng the correspondlng perlod of the prevlous year. This improvement is on account of higher-than-budgeted growth in tax collections and improvement in quality of spending in the first three quarters of the year. Buoyant tax revenues hhve helped the government accommodate higher expenditure amid supply-side volatilities. Overall, gross tax revenue grew at 14.6 per cent over last year. Capital spending increased by 26.5 per cent YoY in the period April, 23 - January, 24 compared to 29 per cent in the corresponding pe-iod of the previous year. The ratio of revenue expenditure to capital outlay feI1 from 6 in FY21 to 3.7 in FY24 (April, 23 - Jantwy,241. Durlng the flrst ten months of FY24, India's merchandise exports and imports contracted by 4.9 per cent and 6.7 per cent, respectively, leadlng to a narrowing of the merchandise trade deficit. The merchandise trade deficit reduced from USD 229.4 billnor. from April'22-Janttary'23 to USD 2O7.2 billd.on in April'23 - Jan:uary'24. Classification across mztjor commodity groups showcases that exports have declined broad-based across all categories, except electronic goods. The net service trade during frrst ten nronths ol F\24 increased by 16.5 per cent. Accordingly, India's overall trade deficit (Merchandise and Services combined) declined from USD 112 biiiion during the first ten months of FY23 to USD 70.4 billion in the corresponding period of FY24. In an effort to boost India's exports, the Government has reduced import duty on parts used to manufacture mobile phones from 15 pel cent to 10 per cent. The forelgn direct investment (FDI| into India during FY24 have been the guided by repatriations, along wlth global FDI trends. As per the latest available data from the RBI, direct investments to Indi.r moderated by 41.2 per cent during April-December, 2023, owing to a sharp growth in repatriations by 41.5 per cent during the period. 2. Important Developments: (i) Honble Finance Minister chaired the 28th meefing of the Financial Stabttity and Development Council (F.SDC) on 21s, Februar5z, 2024at Nev/ Delhi. The meeting was also attended by Union Minister of State for Finance, Members of FSDC, Secretary (EA), Chief Economic Adviser and Senior Adviser / Secretary (FSDC). (ii) Hon'ble Finance Minister met Ms. Anna Bjerde, Managing Director (Operations), World Bank and Ms. Anshula Kant, Managing Director and World Bank Group Chief Financial Officer on 21st Februar5r, 2024. (iii) India-UAE signed a Bilateral Investment Treaty on 13s February, 2024. (iv) The following Finance Track Meetlngs under G2O Brazll Presldency were held during February, 2024: a) The llrst meetlng of the G2O Sustalnable Flnance Worklng Gtoup (SFtrIGl under the Brazilian Presidency was held virtually on 05t'- 06th February, 2o24. b) The flrst G2O Flnance Mlnisters and Central Bank Governors (FMCBGI meetlng was held on 28u - 29th February, 2024 in Sao Paulo, Brazil. The Ministry of Finance delegation was led by Dr. V. Anantha Nageswaran, Chief Economic Adviser and Reserve Bank of India delegation was led by Dr Michael Patra, Deputy Governor. c) The FMCBG meeting was preceded by the Second G20 Finance and Central Bank Deputies Meeting on 26tt - 27th February, 2024 to draft a Communiqu6 of FMCBG. d) On the sidelines of G2O FMCBG meeting, the flrst BRICS FMCBG meeting under the Russian chairmanship of BRICS was held on 27tt February, 2024 atd discussions were held on the priorities proposed by ttre Russial Chair for 2024 under the BRICS Financial Cooperation Agenda. e) NDB Board of Governors a.lso met in a Special meeting in Sao Paulo on 27tt February, 2024, at the Side-lines of G20 FMCBG meeting. The special meeting of the Board of Governors of the New Development Bank was held to discuss the issue of resumption of the disbursement of loans to Russia which have been kept on hold since sanctions were imposed on Russia. (v) The following important meetings were held/attended at the oflicia-l level:a) The first BRICS Finance and Central Bank Deputles (FCBD) meeting under Russian chairmanship was held virtually on Ttit February, 2024 ar-d discussion were held on the priorities altd deliverables of financial cooperation under Russian Chair. b) The 47th Session of IFAD Governing Council was held on 14ur - 15" February, 2024 at Rome, Italy. c) The 113tt meeting of PPP Appraisal Committee (PPPACI was held on 16ti, February, 2024 to consider proposals of i) Northern Bypass (NAM) and Southern Ayodhya Bypass (SAB) in Uttar Pradesh; ii) Guwahati Ring Road in Assam. d) The 114th meeting of PPPAC was held on 21"t Februar5r, 2024 to consider proposal of i) Agra-Gwalior Highway; ii) Border-Gumla- Bharda section as part of Raipur-Dhanbad Economic corridor; iii) 4- lane access-controlled economic corridor from Kharagpur to Moregram section. e) Indla-Uruguay BIT negotiatlons were held virt-ually on 20th February,2024. f) Indta-TaJtklstan BIT negotlations were held virtually on 28th - 29*' Febntary, 2024. d Secretary Economic Affairs met Mr Jochen Flasbarth, State Secretary, German Ministry of Economic Cooperation and De'"elopment (BMZ) on 26th Februely , 2024 to discuss the preparatory steps envisaged for the Leaders level India-Germaly Inter-Governmental Consultations, scheduled to be held this year in India. h) Workshop on PPP structurlng Toolktt - Water & Sanltation Sector was held on 26tt - 27*, February, 2024 at New Delhi. i) The 146tt meeting of Screening Committee on Externally Aided projects was held on 28th February, 2O24. j) Th. 40th meeting of the Early Warnlng Group (EWG) of IMF was held virtually on 29.h Februaqr, 2024 w}rerein methodologies to improve the Early Warning Index, developments relating to frnancia.l section etc. were discussed. k) Meeting of Inter-Ministerial Standlng Committee (IMSC) on Lines of Credit (LOCsl under Indian Development andEconomlc Assistance Scheme IIDEASI was held on 261*t February, 2024 lo discuss about restructured LOCs, their provisioning requirement, continuation of disbursements and other LOC related matters. (vi) The following loan agreements were signed with the bilateral and multilateral development agencies: a) Loans sigrred with Japan Intemational Cooperation Agency (JrcA): i. Rajasthan Climate Resilience Enhancement and Ecosystem Services Improvement Project of JPY 26. 133 bilton. ii. Uttarakhand Urban Water Supply Project of JPY 16.211 billion. iii. Creation of Horticulture Value Chain in Haryana of JPY 16.215 billion. iv. Establishment of Nagaland Medical College Hospital of JPY 1O.OO8 billion. v. Telangana Social and Grassroot Innovation Froject of JPY 23.697 billion. vi. North East Road Network Connectivity Improvement Project: Phase VII (Meghalaya NH127R) of JPY 15.561 billion. vii. North East Road Network Connectivity Improvement Project': Phase-3 (Tranche-Il) of JPY 34.537 billion. viii. Construction of Chennai Periphera-l Ring Road: Phase 2 of JPY 49.847 billion. ix. Dedicated Freight Corridor Project: Phase- 1 (Tranche 5) of JPY 40.000 billion. : b) Bank: Loans signed with World i. Integrated Service Provision and Innovation for Reviving Economies Operation for USD 1OO million. ii. Bihar Integrated Water Resources Management Project (BIWRMP) for USD 386.31 million. c) Loan signed with Asian Development Bank:I Climate Resilient Brahmaputra Integrated Flood and Riverbank Erosion Risk Management Project in Assam for USD 2OO million. d) Multilatera-l Investment Guarantee Agency (MIGA) signed the contract of guarantee with MUFG Bank for USD 1OO million with DFCCIL. (vii) The following important issues were discussed at the Executive Board of Internatlonal Monetary Fund (IMF): a) Regular Eiections of Executive Directors; b) IMF's work on Climate Finance; c) New Membership of Liechtenstein. (viii) The following Notilication were lssued during the month a) Commemorative Coin of denomination of t 100/- to celebrate 2550tt' Nirvan Mahotsav of Bhagwan Mahaveer. 3 Minimum Government, Maximum Governance 'J'he use of ICT in submission of information is being enccuraged 4, Non-Compliance of ACC dlrections/orders: NIL 5 Details of FDI proposals cleared during the month and status of FDI proposals awaitlng approval ln the Departnrent: cleared : Number of proposals 02 Department : Awaiting Approval in the 11 6. Number of VGF projects cleared/approved during February, 2O24: Five projects. 7. Number of PPPAC projects cleared/approved during February, 2O24: NIL. 8. LOCs recommended under Indian Development and Economic Assistance Scheme (IDEAS) during February, 2024: NIL 9 Number of Externally Aided Projects cleared by the DEA's Screening Committee during February, 2O24': 06