Monthly Summary for Cabinet July 2024

4450'1 1 I 031 2024-Coord. I I Government of lndia Ministry of Finance (Department of Economic Affairs) New Delhi, 6th September, 2024 OFFICE MEMORANOUM The undersigned is directed to circulate herewith the unclassified portion of Monthly Summary on important policy decisions in respect r"f Department of Economic Affairs for the Month of July, 2024. usruta Samanta) Deputy Secretary to the Government of lnida Tel No. 2309- 5244 lo All Members of the Union Council of Ministers, Government of lndia, New I Delhi. 2. Vice Chairman, Niti Aayog, Yojna Bhawan, New Delhi. 3. Cabinet Secretary, Cabinet Secretariat, Rashtrapati Bhavan, New Delhi. 4. Secretary to the President of lndia, Rashtrapati Bhavan, New Delhi. 5. Secretary to the Vice-President of lndia, 6, Maulana Azad Road, New Delhi. 6. Principal Secretary to the Prime Minister, PMO, South Block, New Delhi 7. Chairman, Union Public Service Commission, Dholpur House, New Delhi. - 8. All Members of Niti Aayog, Yojna Bhawan, New Delhi. 9. Secretaries to all the Ministries/Departments, Governr, rent of lndia, 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 Nageswaran, Chief Economic Adviser, DEA. 12 Additional Secretary, Cabinet Secretariat, Rashtrapati Bhavan, New Delhi. 13 Shri Manoj Sahay, AS&FA(Finance). 14 Ms. Aparna Bhatia, Advisor(Admn./Coord.i C&C ) 15 Ms. Manisha Sinha, AS(OMl/Crypto assets and Fund Bank) 16 All Heads of Divisions in Department of Economic Affairg. JS(l PP/JS(lSD)/J S(l nv)/JS(Budget)J S(FM)/All Advisers/CAAA 17. Shri Rajesh Malhotra, DG (M&C), M/o Finance, North Block, New Delhi. '18. Guard File -2024. Page 1of 5A4501 /03/2024-Coord.ll 1 Government of lndia Ministry of Finance (Department of Economic Affairs) Subject: Monthly Summary on important policy decisions pertaining to pepartment of Economic Affairs (DEA) for the month oi July,2024. lmportant policy decisions taken and major achievements during the 1 month: Macroeconomic Overview: As per World Economic Outlook, published by the lnternational Monetary Fund in July 2024, the global economic groMh was 3.2 per cent in 2023. Diverging grolvth patterns have emerged among countries. The stark cross-country differences in growth are on account of domestic structural issues, uneven exposure to geopolitical conflicts and the impact of monetary policy tightening. lndian economy has carried forward the momentum built in FY23 into FY24 ' despite considerable external challenges. lndia's real GDP grew by 8.2 per cent in FY24, exceeding 8 per cent mark in three out of four quarters of FY24. The focus on maintaining macroeconomic stability ensured minimal impact of external headwinds. The Government's thrust on capex and sustained momentum in private investment has boosted capital formation growth. Gross Fixed Capital Formation increased by 9 per cent in real terms in 2023-24. Moving forward, healthier corporate and bank balance sheets will further strengthen private investment. The positive trends in residential real estate market indicate that the household sector capital formation is increasing significantly. Inflationary pressures stoked by global troubles, supply chain disruptions, and vagaries of mon:;)ons have been deftly managed by administrative and monetary policy responses. As a result, after averaging 6.7 per cent in FY23, retail inflation declined to 5.4 per cent in FY24. lnflation declined to 3.5 per cent in July 2024. The fiscal balances of the Central Government have improved progressively despite expansionary public investment. Tax compliance gains driven by procedural reforms, restraint in revenue expenditure, and increasing digitisation helped lndia achieve this fine balance. Page 2 of 5The external balance has been pressured by subdued global demand for goods, but strong services exports largely counterbalanced this. As a result, current account deficit stood at 0.7 per cent of the GDP during FY24, air improvement from the deficit of 2.0 per cent of GDP in FY23. lndian economy has recovered and expanded in an orderly fashion post pandemic. The real GDP in FY24 was 20 per cent higher than its level in FY20, a feat that only a very few major economies achieved. Prospects for continued strong groMh in FY25 beyond look good, subject to geopolitical, financial market and climatic risks. 2. lmportantDevelopments: (i) Hon'ble Finance Minister of lndia presented the Budget ior 2024-25 on 23'd July, 2024. The Budget envisages concerted efforts on the nine priorities, viz, Productivity and resilience in Agriculture, Employment & Skilling, lnclusive Human Resource Development and Social Justice, Manufacturing and Services, Urban Development, Energy Security, lnfrastructure, lnnovation, Research & Development and Next Generation Reforms. (ii) The budget strikes a critical balance amongst several objectives - growth, employment, welfare spending, robust capital investments and f,:cal consolidation & improving quality of expenditure. Capital expenditure is budgeted to increase by 17.1o/o. ln line with the commitment made in the Budget 2021-22, the Government would pursue a broad path of fiscal consolidation to attain a level of fiscal deficit tpuryFr lhan.4.5.percqg$.-pt.GDP.-$X zQ?S?Q+rrtb.resullett.spnsolLdatico.cr.dehlJs,,,..l GDP ratio while continuing with efforts to usher and sustain broad-based inclusive economic groMh and welfare for the people. (iii) The following important meetings were attended at the official level: a) Under IMF's Financial Sector Assessment Program (FSAP) 2024 Mission, the technical closing meeting on securities oversight was held between World Bank, Ministry of Finance and financial market regulators virtually on 2nd July, 2024, b) Secretary Economic Affairs met with Mr. Martin Raiser, Regional Vice President South Asia, World Bank on 3'd July, 2024; Page 3 of 6c) lnter-ministerial meeting to review the progress of international arbitration cases against Government of lndia under BIPA,/BIT was held on 3'd July, 2024 through Video Conferencing, d) lndia-European Union lnvestment Protection Agreement (lPA) Negotiations were held through VC on 4th and 24th July, 2024; e) The 3'd ineeting of the G20 Sustainable Finance Working Group under the Brazilian presidency was held on 09th - l Oth July, 2024 in Brazil. The meeting was preceded by a Workshop on financing nature-based solutions on 8th July, 2024. f) Bilateral lnvestment Treaties (BlT) Negotiations were held through VC between lndia- Australia on 08th and 18th July,2024,lndia-Uruguay on 12th July, 2024: lndia - Russia on 18th and 19th July, 2024 and India- lsrael on 25th July,2024; g) A virtual meeting of AIIB Board of Directors was held on 18th July, 2024; h) 1 1th Round of lndia-Korea CEPA upgrade negotiations concerning lnvestment were held on 19th July, 2024 through VC. i) lnter-Ministerial Committee (IMSC) meeting on Lines of Credit (LOCs) to partner countries was held on 22nd July, 2024 wherein Rupee LOCs and other issues were discussed; j) The Pr-.paratory Committee (PrepCom) for the Fourth lnternational Conference on Financing for Development (FfD4) was held in Addis Ababa, Ethiopia on 22nd - 26th July, 2024 lo review the progress in implementation of Addis Ababa Action Agenda as an integral part of Agenda 2030 and also to identify ideas to accelerate implementation of SDGs.; k) lndia-Thailand Preliminary discussions on BIT were held on 25th July, 2024 through VC; l) The 3'd G20 Finance Ministers and Central Bank Governors (FMCBG) meeting was held on 25th -26th July, 2024in Rio De Janeiro, Brazil. The lndian delegation was led by Chief Economic Adviser and Deputy Governor, RBl. The FMCBG meeting was preceded by: i. Third BRICS Finance and Central Bank Deputies meeting under the Russian Chairmanship of BRICS, held on 23'd July,2024 Page 4 of 6ii. Fourth G20 Finance and Central Bank Deputies Meeting on 22nd - 24th July, 2024, during which the Deputies negotiated the G20 communiqu6, leading to its adoption by FMCBGS. iii. Ministerial Meeting of the Task Force for the Establishment of a Global Alliance against Hunger and Poverty on 23'd - 24th July, 2024 in preparation for its formal launch at the G20 Rio de Janeiro Summit in November 2024 m) The 44th meeting of the Empowered Gommittee Viability Gap Funding Scheme was held on 27th July,2024 to discuss the matter of signing premium sharing agreement & Tripartite Agreement in the project development of Vizhinjam lnternational Multipurpose seaport terminal.; - n) The 15th lndo-German Finance Ministries Stsnior Officials Meeting was held through VC on 30th July,2O24., o) IMF SARTTAC Eighth Annual Steering Committee Meeting was held on 31"tJuly, 2024; p) lndia-Qatar BIT Negotiations were held on 31"t July and 1"t August 2024 in Doha, Qatar; (iv) The following loan/grant agreements were signed with multilateral/ bilateral development agencies: a) Loan of USD 170 million with Asian Development Bank (ADB) to consolidate and strengthen lndia's health system preparedness and response capacity to future pandemics; b) Loan of USD 200 million with Asian Development Bank (ADB) to improve solid waste management and sanitation in 100 cities across eight states in lndia; c) Grant Agreement of USD 2,52,300 from New Development Bank (NDB) for Technical Assistance for Kohima Town Water Supply Augmentation Project; d) Additional Financing of JPY 24,069,800,000 (equivalent USD 150 million) from World Bank for Karnataka Urban Water Supply Modernization Project. Page 5 of 6e) The Exchange of Notes and Loan Agreement for the "Mumbai Metro Line 3 Project (Tranche V)" for JICA loan of JPY 84.261 billion were signed on . Osth July,2024 under FY 2024-2o25loan package. f) The Exchange of Notes and Grant Agreement for "Project for Human Resource Development Scholarship" for JICA grant of JPY 223.00 million were signed on29th July,2024. (v) The followirrg important issues were discussed at the Executive Board of lnternational Monetary Fund (lMF): a) Nepal: Comprehensive analysis and update on economic developments and program performance; b) IMF staff's assessment of the Chinese economy and policy . recommendations; c) Assessment of the economy of Singapore; d) Article lV consultation Board meetings: China; Republic of Croatia; Saudi Arabia; Canada; USA and lndonesia. (vi) The following Notifications were issued during the month: a) Commemorative Coin of denomination of t 50/- on 150 Years of 1 Bombay Stock Exchange; b) ( Commemorative Coin of denomination of 75l- on 75 Years celebration of Supreme Court of lndia; ' c) t Commemorative Coin of denomination of 100/- on Birth Centenary of Dr. M. Karunanidhi. 3. Minimum Government, Maximum Governance The use of ICT in submission of information is being encouraged. 4. Non-Compliance of ACC directions/orders: NIL 5. Number of Externally Aided Projects cleared by the DEA's Screening Committee'Iuring July, 2024: 07 6. Details of FDI proposals cleared during the month and status of FDI proposals awaiting approval in the Department: cleared : . Number of proposals 04 Department : Awaiting Approval in the 11 Page 6 of 6