RBI Bulletin - Feb 19, 2025

FEBRUARY 2025 VOLUME LXXIX NUMBER 2Editorial Committee Muneesh Kapur Ajit R. Joshi Rekha Misra Praggya Das Sunil Kumar Snehal Herwadkar Pankaj Kumar V. Dhanya Shweta Kumari Anirban Sanyal Sujata Kundu Editor G. V. Nadhanael The Reserve Bank of India Bulletin is issued monthly by the Department of Economic and Policy Research, Reserve Bank of India, under the direction of the Editorial Committee. The Central Board of the Bank is not responsible for interpretation and opinions expressed. In the case of signed articles, the responsibility is that of the author. © Reserve Bank of India 2025 All rights reserved. Reproduction is permitted provided an acknowledgment of the source is made. For subscription to Bulletin, please refer to Section ‘Recent Publications’ The Reserve Bank of India Bulletin can be accessed at https://bulletin.rbi.org.inCONTENTS Bi-monthly Monetary Policy Statement (February 7, 2025) Governor’s Statement: February 7, 2025 1 Resolution of the Monetary Policy Committee (MPC) February 5 to 7, 2025 7 Statement on Developmental and Regulatory Policies 9 Speeches Challenges in Liability Management: Maintaining the Balance 11 M. Rajeshwar Rao Articles State of the Economy 19 Union Budget 2025-26: An Assessment 67 Quality of Public Expenditure and its Socio-economic Impact in India 83 Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season 99 Current Statistics 117 Recent Publications 167MONETARY POLICY STATEMENT (FEBRUARY 5-7) 2024-25 Governor’s StatementGovernor’s Statement MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Governor’s Statement* further refine the building blocks of this framework by making advances in the use of new data, improving Sanjay Malhotra nowcasting and forecasting of key macroeconomic variables and developing more robust models. The Monetary Policy Committee (MPC) met on On the regulatory front, I would like to mention, 5th, 6th and 7th of this month. You are aware that the especially in the context of some of the proposed Governor’s Statement after the MPC meeting contains regulatory changes pertaining to liquidity coverage not only the resolution of the MPC with regard to the ratio (LCR), expected credit loss (ECL) framework policy rate and stance but also other announcements for provisioning by banks, and the prudential norms and measures, which have a bearing on the monetary governing projects under implementation, that we and regulatory policies. The MPC resolution is of will continue to strengthen, rationalise and refine the course of interest to a large number of people from prudential and conduct-related regulatory framework various walks of life, as it impacts the lives of virtually in the overall interest of the economy. The interest all citizens of the country. The resolution also of the economy demands financial stability and provides the rationale and the thought process of the consumer protection. Our mandate is to enhance MPC, and is of relevance to businesses, economists, both of them. At the same time, economic interest academicians and the finance world. Apart from also warrants increasing efficiency, which too is our these MPC related announcements, the Governor’s duty. We recognise that just like there are no free statement has become an important medium for the lunches, regulation to enhance stability and consumer Reserve Bank to highlight its priorities on which it protection too is not devoid of costs. There are trade- would like the regulated entities to focus their energies offs between stability and efficiency. We will keep this on. It is an opportunity to point out areas of concern trade-off in mind while formulating regulations. It and challenges for the stakeholders to address their will be our attempt to strike the right balance, keeping attention to. It is an occasion for the Reserve Bank to in view the benefits and costs of each and every articulate its views on critical areas of interest. I will regulation. I also want to reassure all stakeholders continue with this practice of a detailed statement. that we will continue the consultative process in regulation-making. The suggestions of stakeholders Before I come to the resolution of the MPC, allow are valuable and we will give serious consideration to me a moment to reflect on the experience of flexible them before taking any major decision. We will also inflation targeting (FIT) framework, introduced in ensure that the implementation of such regulations the year 2016 and reviewed in 2021. I believe that is smooth; we will give sufficient time for transition it has served the Indian economy well over these and where regulations have major implications, the years, including the challenging period since the implementation will be done in a phased manner. pandemic. The average inflation has been lower post The global economic backdrop remains the introduction of FIT. Moreover, CPI inflation has challenging. The global economy is growing below mostly stayed aligned with the target, barring a few the historical average1 even though high frequency occasions of breaching the upper tolerance band indicators suggest resilience2 along with continued since its inception. We will continue to improve the macroeconomic outcomes in the best interest of 1 According to the World Economic Outlook update, IMF (January 2025), the economy using the flexibility embedded in the global growth is projected at 3.3 per cent both in 2025 and 2026, below the framework while responding to the evolving growth- historical (2000-19) average of 3.7 per cent. 2 The global composite PMI at 51.8 in January 2025 remained in inflation dynamics. Moreover, we will strive to the expansion zone even as services sector activity eased. The global manufacturing PMI at 50.1 also returned to the expansion zone after six * Governor’s Statement - February 7, 2025. months of contraction. RBI Bulletin February 2025 1MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Governor’s Statement expansion in trade.3 Progress on global disinflation is by a favourable outlook on food and continuing stalling, hindered by services price inflation. transmission of past monetary policy actions, it is expected to further moderate in 2025-26, gradually With receding expectations on the size and pace aligning with the target. The MPC also noted that of rate cuts in the US, the US dollar has strengthened though growth is expected to recover from the low of and bond yields have hardened. Emerging Market Q2 of 2024-25, it is much below that of last year. These Economies (EMEs) have witnessed large capital growth-inflation dynamics open up policy space for outflows, leading to sharp depreciation of their the MPC to support growth, while remaining focussed currencies and tightening of financial conditions. on aligning inflation with the target. Accordingly, the Divergent trajectories of monetary policy across MPC decided to reduce the policy repo rate by 25 basis advanced economies, lingering geopolitical tensions points to 6.25 per cent. and elevated trade and policy uncertainties have exacerbated financial market volatility. Such an At the same time, excessive volatility in global uncertain global environment has posed difficult financial markets and continued uncertainties about policy trade-offs for EMEs. global trade policies coupled with adverse weather events pose risks to the growth and inflation outlook. The Indian economy, though continuing to This calls for the MPC to remain watchful. Accordingly, remain strong and resilient, also did not remain it decided to continue with a neutral stance. This will immune to these global headwinds, with the Indian provide MPC the flexibility to respond to the evolving Rupee coming under depreciation pressure in the macroeconomic environment. recent months.4 At the Reserve Bank, we have been employing all tools at our disposal to face the multi- Assessment of Growth and Inflation pronged challenges. Growth Decisions of the Monetary Policy Committee (MPC) As per the first advance estimates, real GDP In this backdrop, the MPC, after a detailed growth for the current year is estimated at 6.4 per assessment of the evolving macroeconomic and cent, a softer expansion after a robust 8.2 per cent financial developments and the economic outlook, growth last year.5 Going forward, economic activity is decided unanimously to reduce the policy repo rate expected to improve in the coming year. Agricultural by 25 basis points from 6.50 per cent to 6.25 per cent. activity remains upbeat on the back of healthy reservoir Consequently, the standing deposit facility (SDF) levels6 and bright rabi prospects.7 Manufacturing rate shall be 6.00 per cent and the marginal standing activity is expected to recover gradually in the second facility (MSF) rate and the Bank Rate shall be 6.50 per cent. The MPC also decided unanimously to continue 5 GVA of mining and quarrying, manufacturing, and electricity, gas and water supply is estimated to expand by 2.9 per cent, 5.3 per cent, and 6.8 with the neutral stance and remain unambiguously per cent, respectively in 2024-25. Gross fixed capital formation (GFCF), focussed on a durable alignment of inflation with the the dominant component of real investment, is estimated to expand by 6.4 per cent as against 9.0 per cent growth in the last year. Private final target, while supporting growth. consumption expenditure (PFCE) is estimated to grow at a robust pace of 7.3 per cent in 2024-25 vis-à-vis 4.0 per cent in the previous year. GVA of I shall state the rationale for the decision in brief. agriculture and allied activities accelerated to 3.8 per cent in 2024-25 from The MPC noted that inflation has declined. Supported 1.4 per cent in the previous year. During April-December 2024, wholesale two-wheeler sales recorded 11.6 per cent growth. Work demand under 3 World merchandise trade volume grew by 3.6 per cent (y-o-y) in MGNREGA contracted by 9.2 per cent during April-January 2024-25. November as per CPB Netherlands, World Trade Monitor. 6 All-India water storage in 155 major reservoirs stands at 64 per cent of 4 The Indian rupee (INR) depreciated by 3.2 per cent against the US dollar the total capacity as of January 30, 2025, as against 52 per cent a year ago since November 6, 2024, the day the presidential election results were and decadal average of 55 per cent. announced in the US, largely mirroring the 2.4 per cent appreciation in the 7 As on January 31, 2025, rabi sowing has surpassed last year’s level as dollar index during the same period. well as normal sowing acreage by 1.5 per cent and 4.1 per cent, respectively. 2 RBI Bulletin February 2025Governor’s Statement MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 half of this year and beyond.8 Early corporate results fixed investment.19 Continued buoyancy in services for Q3 indicate a mild recovery in the manufacturing exports will support growth.20 Global headwinds, sector.9 Mining and electricity are rebounding however, continue to impart uncertainty to the from monsoon related disruptions in Q2. Business outlook and pose downward risks. Taking all these expectations remain upbeat, as evidenced from the factors into consideration, real GDP growth for the PMI manufacturing future output index.10 Services next year is projected at 6.7 per cent with Q1 at 6.7 sector activity continues to be resilient.11 PMI services, per cent; Q2 at 7.0 per cent; Q3 at 6.5 per cent; and Q4 however, declined from its recent peak.12 at 6.5 per cent. The risks are evenly balanced. On the demand side, rural demand continues Inflation to be on an uptrend, while urban consumption Headline inflation, after moving above remains subdued with high frequency indicators the upper tolerance band in October, has since providing mixed signals.13 Going forward, improving registered a sequential moderation in November and employment conditions,14 tax relief in the Union December.21 Going ahead, food inflation pressures, Budget, and moderating inflation,15 together with absent any supply side shocks, should see a significant healthy agricultural activity bode well for household softening due to good kharif production,22 winter- consumption. Government consumption expenditure easing in vegetable prices23 and favourable rabi crop is expected to remain modest.16 Higher capacity prospects. Core inflation is expected to rise but utilisation levels,17 robust business expectations18 and remain moderate. Rising uncertainty in global government policy support augur well for growth in financial markets coupled with continuing volatility 8 Manufacturing GVA growth decelerated in Q2:2024-25 on account in energy prices and adverse weather events presents of subdued results of petroleum products, iron and steel, and cement upside risks to the inflation trajectory.24 Taking all companies. 9 Operating profit of 393 listed private manufacturing companies these factors into consideration, CPI inflation for the expanded modestly by 0.9 per cent (y-o-y) during Q3:2024-25 as against a current financial year is projected at 4.8 per cent with contraction of 5.4 per cent observed in Q2:2024-25. 10 PMI Manufacturing Future Output Index in January 2025 expanded to Q4 at 4.4 per cent. Assuming a normal monsoon, CPI 65.1 from 62.5 in December 2024. Future Output Index has hovered above 60.0 since April 2023. inflation for the financial year 2025-26 is projected at 11 E-way bills increased by 17.6 per cent in December 2024. GST revenues 4.2 per cent with Q1 at 4.5 per cent; Q2 at 4.0 per cent; at ₹1.96 lakh crore rose by 12.3 per cent and toll collections expanded by 14.8 per cent during January 2025. Petroleum products consumption Q3 at 3.8 per cent; and Q4 at 4.2 per cent. The risks are expanded by 2.1 per cent in December 2024. Aggregate bank credit and evenly balanced. deposits registered growth of 12.5 per cent and 10.6 per cent, respectively, as on January 24, 2025. 19 As per the Union Budget 2025-26, the central government’s capex is 12 PMI services for January 2025 moderated to 56.5 from 59.3 in December budgeted to expand by 10.1 per cent during 2025-26. Effective capital 2024. expenditure (including grants-in-aid to state governments for capital 13 Domestic air passengers traffic rose by 10.8 per cent in December 2024 expenditure) is budgeted to grow at 17.4 per cent during the financial year. and 14.2 per cent in January 2025 so far. 20 During April-December 2024, services export expanded by 13.3 per cent 14 According to quarterly periodic labour force survey (PLFS), urban as compared with 5.1 per cent recorded in the same period previous year. unemployment rate dipped to 6.4 per cent in Q2:2024-25 from 6.6 per 21 The CPI headline inflation moderated by 98 basis points between cent in the same quarter last year. October and December 2024. 15 Combined consumer price index-based inflation moderated to 5.2 per 22 As per the first advance estimates of kharif production for 2024-25 cent in December 2024 from 6.2 per cent in October 2024. released on November 5, 2024, rice production is expected to increase by 16 Central government revenue expenditure (net of interest payments and 5.9 per cent, while tur and moong dal production is expected to be higher subsidies) is budgeted to grow at 5.0 per cent in 2025-26 as against 7.9 per by 2.5 per cent and 19.8 per cent, respectively in 2024-25, compared to cent growth in 2024-25 (Revised Estimates). 2023-24. 17 As per the quarterly order books, inventories, and capacity utilisation 23 High frequency food price data from Department of Consumer Affairs (OBICUS) survey of the RBI, seasonally adjusted capacity utilisation (CU) (DCA) points to a significant month-on-month correction in prices of of the manufacturing sector at 74.7 per cent in Q2:2024-25 is above the tomatoes, onions, and potatoes in January 2025. long-term average of 73.8 per cent. 24 Indian basket crude oil prices registered a month-on-month decline of 18 As per the Industrial Outlook Survey (IOS) of RBI, manufacturing firms around (-) 2.8 per cent in November 2024, while it increased marginally by assessed marginal improvement in demand conditions in Q3:2024-25. 0.4 per cent in December. In January 2025, Indian basket crude oil prices Further, firms expect marginal improvement in Q4:2024-25 and significant at US$ 80 per barrel registered an increase of 9.4 per cent over December improvement in H1:2025-26. 2024. RBI Bulletin February 2025 3MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Governor’s Statement External Sector the Reserve Bank. We urge the banks to actively trade among themselves in the uncollateratised call money Coming to the external sector, India’s current market to make it deeper and vibrant for better signal account deficit (CAD) moderated from 1.3 per cent of extraction from the weighted average call money rate GDP in Q2 of last year to 1.2 per cent in Q2 of this year.25 According to the World Bank, India, with an (WACR). estimated inflow of 129.1 billion US dollars, continues The Reserve Bank is committed to provide to remain the largest recipient of remittances globally sufficient system liquidity. We have taken a number in 2024.26 The CAD for this year is expected to remain of steps in this regard.29 We will continue to monitor well within the sustainable level. As on 31st January the evolving liquidity and financial market conditions this year, India’s foreign exchange reserves stood at and proactively take appropriate measures to ensure 630.6 billion US dollars, providing an import cover orderly liquidity conditions. of over 10 months.27 Overall, India’s external sector remains resilient as key indicators stay robust.28 Financial Stability I would like to mention here that the Reserve The system-level financial parameters for Bank’s exchange rate policy has remained consistent Scheduled Commercial Banks (SCBs) continue to be over the years. Our stated objective is to maintain healthy.30 The Credit Deposit Ratio (CD ratio) for the orderliness and stability, without compromising banking system at the end of January 2025 was at 80.8 market efficiency. Accordingly, our interventions in per cent, broadly similar to that on 30th September, the forex market focus on smoothening excessive and 2024. Bank liquidity buffers are sufficient. Though the disruptive volatility rather than targeting any specific net interest margin (NIM) moderated, return on assets exchange rate level or band. The exchange rate of the (RoA) and return on equity (RoE) are robust. The Indian Rupee is determined by market forces. system-level parameters for NBFCs too are healthy.31 Liquidity and Financial Market Conditions The Reserve Bank has been observing Financial After remaining in surplus from July to November Literacy Week annually since 2016 to enhance 2024, system liquidity – as measured by the average financial education. Last year, the campaign focused net position under the liquidity adjustment facility on empowering young adults. This year, recognising (LAF) – turned into deficit during December 2024 the critical and multifaceted role of women in society, and January 2025. The drainage of liquidity is mainly attributed to advance tax payments in December 2024, 29 These included daily Variable Rate Repo auctions from 16th January 2025 and purchase of government securities of 58,835 crore rupees capital outflows, forex operations and a significant through open market operations (OMOs) in January. In addition, a package pickup in currency in circulation in January this year. of measures was announced on 27th January 2025 to inject durable liquidity through OMOs, forex buy-sell swap and a 56-day variable rate It has been observed that some banks are repo to be conducted later today. 30 SCB Parameters: The outstanding credit and deposit on a y-o-y basis reluctant to onlend in the uncollateratised call money increased by 11.4 per cent and 10.3 per cent respectively as of January market; instead, they are passively parking funds with 24, 2025. The system-level CRAR of 16.7 per cent in September 2024 was well above the regulatory minimum level. GNPA ratio at 2.5 per 25 India’s current account deficit (CAD) moderated marginally to US$ 11.2 cent in September 2024 improved by 72 bps over September 2023. SMA- billion (1.2 per cent of GDP) in Q2:2024-25 from US$ 11.3 billion (1.3 per 2 Ratio was 0.8 per cent in September 2024. LCR was 128.6 per cent as cent of GDP) in Q2:2023-24. of September 2024. ROA was 1.4 per cent and RoE was 14.6 per cent in 26 https://blogs.worldbank.org/en/peoplemove/in-2024--remittance-flows- September 2024. The NIM was 3.5 per cent in September 2024 vis-à-vis 3.7 to-low--and-middle-income-countries-ar per cent in September 2023. 27 Based on actual merchandise imports (on a BoP basis) during the four 31 NBFC Parameters: Total CRAR of NBFCs is 26.5 per cent and Tier I CRAR quarters period (Q3:2023-24 to Q2:2024-25). is 24.4 per cent, as on 30th, September 2024. GNPA ratio improved from 28 India’s external debt to GDP ratio stood at 19.4 per cent at end- 2.9 per cent in September 2023 to 2.6 per cent in September 2024. The September 2024 (18.8 per cent at end-June 2024), while the net RoA improved from 2.9 per cent in September 2023 to 3.2 per cent in international investment position (IIP) moderated to (-) 9.6 per cent of September 2024. YoY growth in advances was 16.4 per cent in September GDP at end-September 2024 from (-) 10.3 per cent of GDP at end-June 2024. 2024 as compared to 22.5 per cent in September 2023. 4 RBI Bulletin February 2025Governor’s Statement MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 the campaign will emphasise on women’s role in to market participants to manage their interest rate financial decision-making and household budgeting. I risks. We shall now include forward contracts in urge all banks to actively participate in the campaign on Government securities to this suite. This would the theme “Financial Literacy: Women’s Prosperity”, facilitate long-term investors such as insurance funds starting from 24th of this month. to manage their interest rate risk across interest rate cycles. It will also enable efficient pricing of derivatives Additional Measures that use Government securities as underlying I shall now announce certain additional measures. instruments. Necessary directions and circulars for their Access of SEBI-registered non-bank brokers to NDS- implementation shall be issued separately. OM Digital security Fourth, to enhance access of retail investors to First, the rapid digitalisation of financial services government securities, the Reserve Bank shall expand has brought convenience and efficiency but has also the access of NDS-OM, the electronic trading platform for secondary market transactions in government increased exposure to cyber threats and digital risks, securities, to non-bank brokers registered with SEBI. which are getting sophisticated day by day. The surge in digital frauds is a matter of concern, warranting Review of trading and settlement timings across action by all stakeholders. various market segments The Reserve Bank has been taking various Fifth, in view of the various developments in measures to enhance digital security in the banking financial markets and market infrastructure over and payments system. Introduction of Additional the past few years, we shall set up a working group Factor of Authentication (AFA) for domestic digital with representation from various stakeholders to payments is one such measure. It is proposed to undertake a comprehensive review of trading and extend AFA to online international digital payments settlement timing of markets regulated by the Reserve made to offshore merchants, who are enabled for Bank. The Group shall submit its report by 30th April such authentication. of this year. Second, the Reserve Bank shall implement the Concluding Remarks ‘bank.in’ exclusive Internet Domain for Indian banks. To conclude, considering the existing growth- Registration of this domain name will commence from inflation dynamics, the MPC, while continuing with April this year. This will help avoid banking frauds. the neutral stance, felt that a less restrictive monetary This will be followed by the ‘fin.in’ domain for the policy is more appropriate at the current juncture. The financial sector. MPC will take a decision in each of its future meetings Banks and NBFCs must continuously improve based on a fresh assessment of the macroeconomic preventive and detective controls to mitigate cyber outlook. risks. They must develop robust incident response and We are committed to conduct monetary policy recovery mechanisms, reinforced through periodic and take such measures, as appropriate, which are testing, for operational resilience. timely, carefully calibrated and clearly communicated, Introduction of forward contracts in Government to facilitate conducive macroeconomic conditions that Securities reinforce price stability, sustained economic growth and financial stability. Third, over the past few years, we have expanded the suite of interest rate derivative products available Thank you. Namaskar and Jai Hind. RBI Bulletin February 2025 5Resolution of the Monetary Policy Committee (MPC) MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 February 5 to 7, 2025 Monetary Policy Statement, The world economic landscape remains challenging with slower pace of disinflation, lingering geopolitical 2024-25 Resolution of the tensions and policy uncertainties. The strong dollar, Monetary Policy Committee inter alia, continues to strain emerging market currencies and enhance volatility in financial markets. (MPC) February 5 to 7, 2025* On the domestic front, as per the First Advance Monetary Policy Decisions Estimates (FAE), real gross domestic product (GDP) is estimated to grow at 6.4 per cent (y-o-y) in 2024-25 The Monetary Policy Committee (MPC) held its supported by a recovery in private consumption. On 53rd meeting from February 5 to 7, 2025 under the the supply side, growth is supported by the services chairmanship of Shri Sanjay Malhotra, Governor, sector and a recovery in agriculture sector, while tepid Reserve Bank of India. The MPC members Dr. Nagesh industrial growth is a drag. Kumar, Shri Saugata Bhattacharya, Prof. Ram Singh, Dr. Rajiv Ranjan, and Shri M. Rajeshwar Rao attended Looking ahead, healthy rabi prospects and an the meeting. After assessing the current and evolving expected recovery in industrial activity should support macroeconomic situation, the MPC unanimously economic growth in 2025-26. Among the key drivers on decided to: the demand side, household consumption is expected to remain robust aided by the tax relief in the Union • reduce the policy repo rate under the liquidity Budget 2025-26. Fixed investment is expected to adjustment facility (LAF) by 25 basis points recover, supported by higher capacity utilisation levels, to 6.25 per cent with immediate effect; healthy balance sheets of financial institutions and consequently, the standing deposit facility corporates, and Government’s continued emphasis on (SDF) rate shall stand adjusted to 6.00 per capital expenditure. This is corroborated by positive cent and the marginal standing facility (MSF) business sentiments highlighted in the Reserve rate and the Bank Rate to 6.50 per cent; Bank’s enterprise surveys and PMIs. Resilient services • continue with the neutral monetary policy exports will continue to support growth. However, stance and remain unambiguously focussed headwinds from geo-political tensions, protectionist on a durable alignment of inflation with the trade policies, volatility in international commodity target, while supporting growth. prices and financial market uncertainties, continue to These decisions are in consonance with the pose downside risks to the outlook. Taking all these objective of achieving the medium-term target for factors into consideration, real GDP growth for 2025- consumer price index (CPI) inflation of 4 per cent 26 is projected at 6.7 per cent with Q1 at 6.7 per cent; within a band of +/- 2 per cent, while supporting Q2 at 7.0 per cent; and Q3 and Q4 at 6.5 per cent each growth. (Chart 1). The risks are evenly balanced. Growth and Inflation Outlook Headline inflation softened sequentially in November-December 2024 from its recent peak of 6.2 The global economy is growing below the historical per cent in October. The moderation in food inflation, average even though high frequency indicators suggest as vegetable price inflation came off from its October resilience amidst continued expansion in world trade. high, drove the decline in headline inflation. Core * Released on February 7, 2025. inflation remained subdued across goods and services RBI Bulletin February 2025 7MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Resolution of the Monetary Policy Committee (MPC) February 5 to 7, 2025 components and the fuel group continued to be in actions, it is expected to further moderate in 2025-26, deflation. gradually aligning with the target. The MPC also noted that though growth is expected to recover from the low Going ahead, food inflation pressures, absent any of Q2:2024-25, it is much below that of last year. These supply side shock, should see a significant softening growth-inflation dynamics open up policy space for due to good kharif production, winter-easing in the MPC to support growth, while remaining focussed vegetable prices and favourable rabi crop prospects. on aligning inflation with the target. Accordingly, the Core inflation is expected to rise but remain moderate. MPC unanimously voted to reduce the policy repo rate Continued uncertainty in global financial markets by 25 basis points to 6.25 per cent. coupled with volatility in energy prices and adverse weather events presents upside risks to the inflation At the same time, excessive volatility in global trajectory. Taking all these factors into consideration, financial markets and continued uncertainties about CPI inflation for 2024-25 is projected at 4.8 per cent global trade policies coupled with adverse weather with Q4 at 4.4 per cent. Assuming a normal monsoon events pose risks to the growth and inflation outlook. next year, CPI inflation for 2025-26 is projected at 4.2 This calls for the MPC to remain watchful. Accordingly, per cent with Q1 at 4.5 per cent; Q2 at 4.0 per cent; Q3 the MPC unanimously voted to continue with a at 3.8 per cent; and Q4 at 4.2 per cent (Chart 2). The neutral stance. This will provide MPC the flexibility to risks are evenly balanced. respond to the evolving macroeconomic environment. Rationale for Monetary Policy Decisions The minutes of the MPC’s meeting will be published on February 21, 2025. The MPC noted that inflation has declined. Supported by a favourable outlook on food and The next meeting of the MPC is scheduled during continuing transmission of past monetary policy April 7 to 9, 2025. 8 RBI Bulletin February 2025Statement on Developmental and Regulatory Policies MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Statement on Developmental OM subject to the regulations and conditions laid down by the Reserve Bank in this regard. Necessary and Regulatory Policies instructions are being issued separately. 3. Comprehensive review of trading and settlement This Statement sets out various developmental timings across various market segments and regulatory policy measures relating to (i) Financial Markets; (ii) Cybersecurity ; and (iii) Payment Systems. Synchronized and complimentary market and settlement timings across various financial I. Financial Markets market segments can facilitate benefits of efficient 1. Introduction of forward contracts in Government price discovery and optimization of the liquidity securities requirements. Over the last few years, there have Over the past few years, the Reserve Bank has been several developments including increased been expanding the suite of interest rate derivative electronification of trading, availability of forex and products available to market participants to manage certain interest rate derivative markets on a 24X5 basis, their interest rate risks. In addition to Interest Rate increased participation of non-residents in domestic Swaps, products such as Interest Rate Options, financial markets and availability of payment systems Interest Rate Futures, Interest Rate Swaptions, on a 24X7 basis. Accordingly, it has been decided to set Forward Rate Agreements, etc. are available to market up a working group with representation from various participants. We have been receiving feedback about stakeholders to undertake a comprehensive review the need to allow forward contracts in Government of trading and settlement timing of financial markets securities to enable further market development. regulated by the Reserve Bank. The Group is expected to submit its report by April 30, 2025. Such forward contracts will enable long-term investors such as insurance funds to manage their II. Cybersecurity interest rate risk across interest rate cycles. They will 4. Enhancing Trust in the Financial Sector through also enable efficient pricing of derivatives that use ‘bank.in’ and ‘fin.in’ domains bonds as underlying instruments. Draft directions in this regard were issued in December 2023. The final Increased instances of fraud in digital payments directions, taking into account the public feedback, are a significant concern. To combat the same, the Reserve Bank of India (RBI) is introducing the ‘bank. will be issued shortly. in’ exclusive Internet Domain for Indian banks. This 2. Access of SEBI-registered non-bank brokers to initiative aims to reduce cyber security threats and NDS-OM malicious activities like phishing; and, streamline The Negotiated Dealing System – Order Matching secure financial services, thereby enhancing trust in (NDS-OM) is an electronic trading platform for digital banking and payment services. The Institute secondary market transactions in government for Development and Research in Banking’ Technology securities. Access to NDS-OM is, at present, available (IDRBT) will act as the exclusive registrar. The actual to regulated entities and to the clients of banks and registrations will commence from April 2025. Detailed standalone primary dealers. With a view to widening guidelines for banks will be issued separately. Going access, it has been decided that non-bank brokers forward, it is planned to have an exclusive domain viz., registered with SEBI can directly access NDS-OM, on “fin.in” for other non-bank entities in the financial behalf of their clients. These brokers may access NDS- sector. RBI Bulletin February 2025 9MONETARY POLICY STATEMENT (FEBRUARY 5¯7) 2024¯25 Statement on Developmental and Regulatory Policies III. Payment Systems In order to provide a similar level of safety for online international transactions using cards issued 5. Enabling Additional Factor of authentication in in India, it is proposed to enable AFA for international cross-border Card Not Present transactions card not present (online) transactions as well. This Introduction of Additional Factor of will provide an additional layer of security in cases Authentication (AFA) for digital payments has where the overseas merchant is enabled for AFA. enhanced the safety of transactions which, in turn, Draft circular will be issued shortly for feedback from provided confidence to customers to adopt digital stakeholders. payments. This requirement, however, is mandatory for domestic transactions only. 10 RBI Bulletin February 2025SPEECHES Challenges in Liability Management: Maintaining the Balance M. Rajeshwar RaoChallenges in Liability Management: Maintaining the Balance SPEECH Challenges in Liability The Global Financial Crisis (GFC) of 2008, during which banks faced vulnerabilities on both sides of the Management: Maintaining the balance sheet, challenged this approach resulting in Balance* profound changes to the banking sector’s regulatory framework. During the crisis, many banks experienced liquidity crisis leading to insolvencies despite M. Rajeshwar Rao adherence to capital requirements, highlighting the fragility of funding structures reliant on short-term At the outset, I would like to thank the organisers liabilities. This underscored the systemic importance for inviting me to this 17th edition of the Mint BFSI of liquidity management and the need for regulatory Summit & Awards. I am delighted to get this opportunity oversight beyond asset-side vulnerabilities. The policy to engage with you during this event. As a regulator response was a paradigm shift that led to prescribing for banks and non-banking financial companies comprehensive global liquidity standards viz. Liquidity (NBFCs), I thought this could be an occasion to reflect Coverage Ratio (LCR) and Net Stable Funding Ratio on a less debated area for the regulated entities - their (NSFR) which targeted short-term and medium-term liabilities management and the challenges. In flagging liquidity resilience. the mismatch between deposit and credit growth, It is now well understood that liability Governor Das had previously drawn our attention management is crucial not only for the stability to the rising challenge in this area. So, I thought of and solvency of a regulated entity (RE) but is also wading in with a few thoughts for your consideration. as a key factor influencing its return on capital and Introduction growth trajectory. From the earnings perspective, the spread on interest earned on loans and the cost The core function of banking involves accepting of funds determines the bank’s net income and deposits, which are usually short-term, and funding profitability1. The cost of liabilities thus has a direct loans, which generally have longer maturities. Maturity impact on Net Interest Margins (NIMs) and earnings transformation is thus an inherent feature of financial ratios. For instance, the share of current and savings intermediation and banks are strongly exposed to the account (CASA) deposits in total deposits, the mix of associated risks. As a result, strategic management of retail versus wholesale funding and the duration of assets and liabilities is crucial to optimise profitability, liabilities play a key role in determining the funding improve liquidity and protect the bank against various cost and, therefore, profitability of banks. Further, risks. Historically, regulatory frameworks, including the stability of funding is the key to resilience during the Basel I and II, placed a greater emphasis on the any crisis. In this context, let me dwell briefly on the asset side of the balance sheet, focusing on credit evolution of liability management in India, changing risk management and capital adequacy. This focus trends in liability structure, entity-specific challenges, arises from the belief that credit defaults and asset and regulatory expectations. deterioration pose the main threats to a bank’s Evolution of ALM in India solvency. Liquidity and funding risks, primarily As you all are aware, Indian banking underwent stemming from liabilities, were largely viewed as an a strategic transformation with the broader economic issue that banks could manage themselves without reforms of the 1990s. The deregulation of interest requiring any regulatory oversight and intervention. rates and greater global integration made the risks encountered by financial institutions more complex * Keynote address delivered by Shri M. Rajeshwar Rao, Deputy Governor at Mint Annual BFSI Summit & Awards 2025 on January 17, 2025 at Mumbai. Inputs provided by Akhilesh Gokhale, Tony Mammen 1 The other main driver of profits is the provision requirement which is and Shashank Srivastava are gratefully acknowledged. dependent on the asset quality. RBI Bulletin February 2025 11SPEECH Challenges in Liability Management: Maintaining the Balance and significant, requiring strategic management. interbank deposit limits for urban cooperative banks Accordingly, the guidelines on Asset-Liability (UCBs) (2009). Scheduled Commercial Banks (SCBs) Management (ALM) for financial institutions were (excluding small finance banks, payments banks and first issued in February 1999 with further additions regional rural banks) have been permitted to set Board in late 2000s, covering the interest rate and liquidity approved limits for borrowing in Call and Notice risks along with prudential limits and disclosure Money Markets, within the prudential limits for IBL. framework. Such liability-based concentration limits are unique to India and reflect the Reserve Bank’s early cognizance The Indian Prudential Framework incorporated of these risks. the Basel Committee on Banking Supervision (BCBS) Principles for Sound Liquidity Risk Management Liability Structure and Growth in 2012, followed by the adoption of two minimum Deposits continue to be the primary source standards for funding liquidity viz. LCR and of funds for SCBs, amounting to ₹217 lakh crore, NSFR. Recognizing that the LCR calibrations which represented 77 per cent of total liabilities at overlooked intraday liquidity and the increasing the end of FY 2024. In contrast, capital funds (i.e., interdependencies within the financial system could capital, reserves & surplus) and borrowings, each lead to liquidity disruptions affecting payment and constituted around 9 per cent of liabilities2. The settlement processes, guidelines for monitoring comparison of data between FY 2016 to FY 2024 intraday liquidity were introduced. To mitigate the indicates that the deposits have grown at an annual concentration risk and to curtail systemic implications rate3 of around 10 per cent, aligning with the overall of uncontrolled liability of larger banks, the Reserve balance sheet growth, and their contribution to total Bank had very early on put in place limits on Inter- liabilities has remained stable at around 77 per cent Bank Liabilities (IBL) for commercial banks (2007) and (Charts 1 and 24). Meanwhile, borrowings have grown Chart 1: Composition of Liabilities of Chart 2: Composition of Liabilities of SCBs - end March 2024 SCBs - FY 2016 to FY 2024 100 4% 9% 9% 80 60 40 20 0 78% Capital Funds Borrowings Deposits Others Capital Funds Borrowings Deposits Others 2 Borrowings include inter alia borrowings from RBI, other banks, institutions and agencies, capital instruments (Perpetual Debt Instruments and Tier 2 debt), and other bonds and debentures. The remaining liabilities (4.2 per cent) are composed of other liabilities and provisions. 3 Cumulative Annual Growth Rate (CAGR). 4 Source: RBI Reports on Trend and Progress of Banking in India, 2016 to 2024. 12 RBI Bulletin February 2025 )tnec rep( seitilibaiL latoT fo erahS 6102 7102 8102 9102 0202 1202 2202 3202 4202 Financial YearChallenges in Liability Management: Maintaining the Balance SPEECH at a slower rate of 7 per cent as a result of which Chart 3: Composition of Deposits of its share in total liabilities has decline from 11 per SCBs - FY 2016 to FY 2024 cent to 9 percent. On the other hand, Capital Funds have grown at close to 13 per cent and its share has increased progressively from 7.6 per cent to 9.3 per cent, indicating the deleveraging of banks’ balance sheets, boosted by higher profitability and capital raising efforts. Maturity wise, during the same period, the contribution of term deposits has declined from 65.8 per cent of total deposits to 60.9 per while the shares of savings and current account deposits have increased from 25.3 per cent and 8.9 per cent to 29.2 per cent and 9.9 per cent, respectively. Consequently, CASA ratio has improved from 34.2 per cent to 39.1 per cent. This trend may have contributed to the Demand Deposits Savings Bank Deposits Term Deposits improvement in Net Interest Margins (NIMs) of SCBs, housing loans and can also raise funds in overseas which has increased from 2.6 per cent in FY 2015-16 markets under the ECB route. to 3.3 per cent in FY 2023-24 (Chart 35). For Non-Banking Financial Companies (NBFCs), Apart from deposits, banks raise liabilities in the borrowings are a significant source of funding, form of debt capital instruments such as Additional amounting to ₹34.46 lakh crore or 68 per cent of total Tier 1 (AT1) bonds and Tier 2 bonds. Furthermore, liabilities as at end-March 2024. Within borrowings, banks are permitted to issue domestic Long-Term debentures and borrowings from banks are the main Bonds to finance infrastructure and affordable contributors (Charts 4 and 56). This makes NBFC’s 5 Source: RBI Reports on Trend and Progress of Banking in India, 2016 to 2024. 6 Source: RBI Report on Trend and Progress of Banking in India 2023-24. RBI Bulletin February 2025 13 )tnec rep( stisopeD latoT fo erahS 100 80 60 40 20 0 6102 7102 8102 9102 0202 1202 2202 3202 4202 Financial Year Chart 4: Composition of Liabilities of Chart 5: Composition of NBFC borrowings - NBFCs - end March 2024 end March 2024 3% 14% 7% 2% 20% 3% 36% 3% 3% 2% 39% 68% Debentures Bank borrowings Borrowings from FIs Inter-corporate borrowings Share Capital Reserves & Surplus Public Deposits Commercial papers Subordinated debtSPEECH Challenges in Liability Management: Maintaining the Balance liabilities more market-driven and sensitive to interest asset classes, search for higher yields and portfolio rate changes compared to banks. diversification have further fuelled this trend. Over the past decade8, the number of subscribers and the Changing Trends and Challenges assets under management (AUM) of mutual funds, Banks are at the forefront of providing credit to pension and provident funds, and insurers have risen productive sectors of the economy by channelizing significantly, a trend likely to accentuate further. household savings, which currently comprise While this trend may not alter the aggregate funding approximately two-thirds of India’s gross savings. available for banks, it may change the character of Recent trends indicate a shift in household preference deposits having implications on cost of funds and to financial assets for saving purposes leading to margins for banks. movement of these savings beyond traditional bank Although CASA deposits have improved over the deposits towards capital market assets (Charts 6 and longer term as previously mentioned, there has been 77). This shift is driven by several factors, including a recent shift, with share of CASA deposits declining targeted efforts to deepen the financial sector, the and that of term deposits, especially in higher interest growth of digital public infrastructure that offers rate buckets, increasing9. This has implications for convenient and frictionless access to capital markets, bank NIMs and profitability. Lately, banks have changing investment preferences due to demographic also increased their reliance on short term funding shifts, increased financial awareness, and the through Certificates of Deposits (CDs) and the average recent period of sustained high returns yielded by CD outstanding had reached levels last seen in 201210. equity markets. Additionally, the rise of alternative Banks must, however, take cognizance of the fact that Chart 6: Growth of Flow of Household Financial Assets - component wise (FY 2020 - FY 2024) Component of Household Financial Assets 7 Source: RBI Quarterly Data Release on Household Financial Savings, RBI Staff Calculations. Note: (i) Charts 6 and 7 include select components of household financial assets; (ii) Chart 6 provides the CAGR of Flow of Household Financial Assets. 8 For example, the mutual fund industry’s AUM has grown from ₹10 trillion in 2014 to ₹66.93 trillion as on December 31, 2024, more than 6-fold increase in 10 years. The total number of accounts/folios as on December 31, 2024 stood at 22.50 crore. [Source: Association of Mutual Funds of India (AMFI) website]. 9 Term deposits formed 82 per cent of incremental deposits mobilised in H1:2024- 25. Source: RBI Financial Stability Report December 2024. 10 Average CDs outstanding in FY 2023-24 was ₹4.18 lakh crore. Source: RBI Database on Indian Economy (DBIE), RBI Staff Calculations. 14 RBI Bulletin February 2025 )tnec rep( htworG launnA Chart 7: Share of Stock of Financial Assets of Households - component wise (June 2019 - March 2024) 35 60 30 50 25 40 20 30 15 20 10 10 5 0 0 Bank Life Provident Mutual Equity Deposits Insurance and Funds Funds Pension Funds stessA laicnaniF dlohesuoH fo erahS )tnec rep( Bank Life Currency Mutual Pension Deposits Insurance funds Funds Funds Component of Household Financial Assets Jun-19 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24Challenges in Liability Management: Maintaining the Balance SPEECH the higher reliance on short term liabilities can have its Another issue pertains to deposit growth of own repercussions if market conditions deteriorate. certain banks not keeping pace with their loan growth, which has raised regulatory concerns about the risks Banks adopt distinct liability sourcing strategies associated with higher dependency on wholesale based on their competitive strengths, market funding for credit disbursement. Such imbalances are positioning, and business priorities. Large banks with viewed as indicators of potential structural liquidity an extensive branch network may have access to low- vulnerabilities. While regulators monitor these cost, stable retail deposits. While the banks with a trends as a macroeconomic gauge to assess systemic more pronounced urban presence may target affluent risks in the banking sector, it is crucial to recognise customer segments, offering high-value deposit that for individual banks these indicators alone are products tailored to high-net-worth individuals (HNIs) insufficient to fully capture liquidity risk. From a and corporate clients. Additionally, some banks with short-term liquidity perspective, tools like the LCR advanced technology stacks leverage digital platforms offer a more nuanced view by considering factors to enhance customer acquisition and streamline such as deposit stability, depositor behaviour, and the liability sourcing, providing a competitive edge in dynamics between retail and wholesale funding. The attracting both retail and corporate deposits. On the relationship between these indicators is multifaceted other hand, differentiated banks are seen to have a and often contradictory, making it essential to avoid higher reliance on inter-bank deposits and wholesale relying on any single measure in isolation and funding. This diversity in funding profiles presents necessitating a holistic assessment of the ALM profile unique challenges in ALM, as each business strategy of banks. introduces its own complexities in managing liquidity, Contrary to banks, the liability profile of NBFCs11 is cost of funds, and risk alignment. shaped by their primary activities, regulatory ‘Institutionalisation’ of deposits, which I referred requirements, and the types of assets they finance. to earlier, will bring along specific challenges for Historically, crises have demonstrated that NBFCs’ the ALM for banks. A reduced reliance on retail over-reliance on short-term funding to support long- deposits, coupled with a greater share of funding from duration assets, such as infrastructure and housing institutional sources will likely result in increased loans, can result in significant liquidity constraints, funding costs, which in turn negatively affects deterioration in investor confidence, and credit rating profitability. The quest to maintain the margins can downgrades, thereby constricting their ability to access lead to eventual transmission of increased funding capital markets. Consequently, NBFCs became heavily cost to interest rate on loans. This would either dependent upon bank funding, both direct lending constrain growth of loan book or may force the and banks’ subscriptions to debentures & Commercial lenders to dilute the underwriting standards and Papers (CPs), leading to funding concentration. lend to riskier borrowers to maintain earnings ratios. Recognizing the increasing dependency of NBFCs on Banks must stay alert to the risks of certain practices bank borrowings, the RBI increased the risk weights of that may seem less evident during strong economic bank exposures to NBFCs by 25 percentage points in growth but could lead to serious consequences November 2023 which has helped in moderating the during economic downturns. Banks heavily reliant YoY growth in bank borrowings by NBFCs. To offset on wholesale funding are more vulnerable to rollover 11 NBFCs regulated by the Reserve Bank are a group of heterogeneous risks and outflows in times of economic stress. financial entities operating with diverse business strategies viz. investment credit, infrastructure finance, micro-finance, factoring, core investment, Therefore, effective liability management is crucial housing finance, non-operative financial holding, account aggregator, for mitigating these risks. peer-to-peer lending, and primary dealing activities. RBI Bulletin February 2025 15SPEECH Challenges in Liability Management: Maintaining the Balance this, NBFCs have increased funding through CPs12 and vulnerabilities in highly interconnected financial non-convertible debentures (NCDs)13. structure, where the failure of one segment can precipitate cascading liquidity challenges across While accessing international markets can reduce multiple sectors. Traditional liability management NBFCs’ reliance on the domestic banking system and models, often based on historical data, may not provide a broader range of funding options, it also adequately capture the risks posed by unprecedented exposes them to additional risks, particularly unhedged market conditions. Consequently, regulated entities currency exposures, which can lead to volatility in must develop more sophisticated stress-testing funding costs and potential liquidity strains due to methodologies that evaluate their ability to withstand exchange rate fluctuations. NBFCs should integrate extreme scenarios, including those that involve forex hedging into their ALM framework and closely the amplification of shocks across interconnected monitor currency exposure to mitigate funding cost financial networks. volatility. The liquidity transformation of assets through securitization to free up resources for on- The final point is the importance of contingency lending can also serve as an important tool to improve funding plans (CFPs). In general, REs must have the ALM structure. formal CFPs commensurate with their complexity, risk profile, scope of operations and their role in Regulatory Expectations the financial system. Among others, it must clearly Now, let me flag a few key issues that are being articulate the available potential contingency funding extensively debated globally on the ALM practices sources and the amount of funds that can be derived employed by banks and NBFCs and the regulatory from these sources. It is important to note that the expectations on these issues. lender of last resort (LOLR) function of central banks is regarded as (implicit) insurance for banks against First, the rise of innovative products and liquidity shocks that money market participants technologies in banking has enhanced consumer are unwilling or unable to absorb. The value of this flexibility in accessing funds & managing cash flows, insurance increases with banks’ exposure to liquidity significantly transforming customer behaviour. risk, which increases moral hazard. Banks need to Further, the evolving dynamics of information recognize that, to address this moral hazard, the dissemination through traditional and social media central banks retain discretion to decide whether can profoundly influence customer behaviour, to extend emergency liquidity assistance to specific potentially escalating and amplifying a crisis. These institutions. This assistance is intended as a safety factors present heightened challenges and banks net for the entire financial system through judicious needs to be watchful and carefully review their use of public funds and is often accompanied by modelling assumptions on stability of deposits supervisory intervention and conditionalities. and customer behaviour to better predict deposit Therefore, the LOLR function should not be regarded retention, withdrawal patterns, pre-payments, and as a routine component of contingency funding. interest rate sensitivities. As far as NBFCs are concerned, while they play a Second, the Liability-Driven Investment key role in enhancing access to credit and supporting (LDI) crisis in the UK demonstrated the inherent economic growth, their activities also involve a 12 Outstanding CPs for NBFCs have increased by 26.2 per cent in FY significant amount of maturity, liquidity, and credit 2023-24 (Source: RBI Report on Trend and Progress of Banking in India 2023-24). transformation. Most NBFCs, unlike banks, do not 13 Outstanding unsecured debentures for NBFCs have increased by 16.2 have access to public deposits, as the regulatory per cent in FY 2023-24 (Source: RBI Report on Trend and Progress of Banking in India 2023-24). approach over the years has been to disincentivise 16 RBI Bulletin February 2025Challenges in Liability Management: Maintaining the Balance SPEECH the deposit taking activities of the NBFCs. Compared two decades, which would require a corresponding to the more stable retail sources of funding available increase in liabilities and capital for the financial to banks given their access to official backstops and sector. This brings forth the need to address some their deposit franchises, NBFCs will continue to be of the emerging challenges as customer behaviour dependent on banks and capital markets for their and preferences are undergoing profound changes funding. It is imperative for NBFCs to diversify their while global ecosystems and external factors such as third-party dependencies and technology shifts are funding sources while optimizing borrowing costs and growing increasingly complex, reshaping the business mitigating associated risks for a sustainable growth landscape. Collectively, these dynamics are creating path. a challenging environment for REs who would need Conclusion to recalibrate their approach and business strategies. Today, we collectively aspire for a ‘Viksit Bharat’ This is not just about managing risks but also seizing by 2047, the centenary of our independence. This opportunities to optimize funding structures, enhance ambition demands consistent and sustainable stability, and support economic growth. The road to a “Viksit Bharat” by 2047 will depend significantly on economic growth combined with a systemic capacity how well the financial system adapts to these trends for resilience. In order to achieve the ambitious and manages the complexities of resource raising and economic growth target under this vision, the liability management. financial assets and bank assets would need to achieve a consistent and high paced growth over the next Thank you. RBI Bulletin February 2025 17ARTICLES State of the Economy Union Budget 2025-26: An Assessment Quality of Public Expenditure and its Socio-economic Impact in India Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing SeasonState of the Economy ARTICLE State of the Economy* in other advanced economies (AEs). For emerging market economies (EMEs), growth in 2025 is expected to broadly match that of 2024. The global growth and The global economy continues to grow at a steady but trade outlook, however, faces downside risks from moderate pace, with divergent outlook across countries the evolving US tariffs, the timing and magnitude of amid rapidly evolving political and technological which remain highly uncertain. The US trade policy landscapes. Financial markets remain on edge on the uncertainty has spiked to levels last seen during the slowing pace of disinflation and the potential impact 2019 episode of US-China trade war and restrictive of tariffs. Emerging market economies (EMEs) are trade policies and fragmentation could lead to a long- witnessing selling pressures from foreign portfolio investors term shift in global trade patterns rather than a short- (FPIs) and currency depreciation engendered by a strong term disruption, and upward pressures on consumer US dollar. In India, high frequency indicators point and business costs.1 towards a sequential pick-up in momentum of economic activity during H2:2024-25, which is likely to sustain Global financial markets have been on a precipice, moving forward. The Union Budget 2025-26 prudently with every incoming information generating sharp balances fiscal consolidation and growth objectives by gyrations. US equity markets rallied following the continued focus on capex alongside measures to boost change in US administration and healthy corporate household incomes and consumption. Retail inflation earnings.2 The launch of R1 by DeepSeek3, however, moderated to a five-month low in January, mainly due to generated shockwaves that wiped off US$ 1 trillion a sharp decline in vegetable prices. from the equity valuations on a single day (January 27, 2025). Sovereign bond yields continue to exhibit two- Introduction way movements. The US dollar index surged following The global economy is exhibiting steady growth the tariff announcements, triggering capital outflows amidst evolving political and technological landscapes, from emerging markets and intensifying currency both of which have taken the centre stage in policy pressures. Concerted policy actions would be needed discourse during 2025 so far. The International to foster a more congenial external environment, Monetary Fund (IMF), in its January 2025 update enhance macroeconomic stability, reduce structural of the World Economic Outlook (WEO), projected constraints, and address the effects of climate change the global economy to grow by 3.3 per cent in 2025, to avoid a risk of many low-income countries not being close to that of 3.2 per cent in 2024, but below the able to catch-up to middle income status by 2050.4 average of 3.7 per cent witnessed during the first two Global consumer price inflation (CPI) declined decades of the 21st century. The growth outlook varies in 2024 to 5.7 per cent (100 bps lower than a year widely across economies - a stronger growth in the Unites States (US) is expected to offset the weakness 1 World Economic Forum, Chief Economists’ Outlook, January 2025; Peterson Institute for International Economics, “Trump’s threatened * This article has been prepared by Rekha Misra, G. V. Nadhanael, Rajni tariffs projected to damage economies of the US, Canada, Mexico, and Dahiya, Durga G, Arpita Agarwal, Harshita Keshan, Ramesh Gupta, China”, February 17, 2025; Financial Times, “Threat of Trump tariffs adds Harendra Behera, Neelima KM, Satyarth Singh, Alice Sebastian, Ettem to global economic uncertainty, IMF warns”, January 11, 2025. Abhignu Yadav, Harshita Yadav, Siddharth Arya, Satyendra Kumar, 2 US benchmark S&P 500 index rose by 5.0 per cent during January 10-25, Archana Dilip, Agamani Saha, Dibyarka Chaule, Sritama Ray, Shivam, 2025. Khushi Sinha, Kartikey Bhargav, Yuvraj Kashyap, Nikhil Prakash Kose, 3 R1, is a large language model (LLM), developed by DeepSeek, a Chinese Ashish Khobragade, Dilpreet Sharma and Avnish Kumar. Views expressed artificial intelligence (AI) company at a radically lower cost using much less in this article are those of the authors and do not represent the views of computing power than existing LLMs. the Reserve Bank of India. 4 Global Economic Prospects, World Bank, January 2025. RBI Bulletin February 2025 19ARTICLE State of the Economy back).5 The decline was more pronounced in the case Investment intentions of the private sector remained of AEs, although the more recent prints have shown stable, with the total cost of projects sanctioned by an increase in inflation in major AEs, with services banks/financial institutions (FIs) at close to ₹ one lakh inflation proving to be obdurate. Diverging inflation crore in Q3:2024-25. External commercial borrowings and growth outcomes are also reflected in monetary (ECBs) and Initial Public Offerings (IPOs) for capex policy actions —the US holding rates steady, the UK purposes also recorded an uptick during Q3. and the euro area opting for a cut, and Japan raising The Union Budget 2025-26 has placed thrust on its rate. The potential impact of trade conflicts on boosting consumption while maintaining the quality currency and financial markets further confounds the of expenditure, with effective capital expenditure/ choices policymakers face. GDP ratio budgeted to improve to 4.3 per cent in 2025- In this challenging and increasingly uncertain 26 from 4.1 per cent in 2024-25 (RE). global environment, the Indian economy is poised Uncertainty surrounding global trade and to sustain its position as the fastest growing major geopolitical landscape have had a bearing on domestic economy during 2025-26 as per the estimates of major equity markets. The benchmark and broader markets multilateral agencies.6 High frequency indicators show that the economy is on a path of recovery declined on account of selling pressures from foreign during H2:2024-25 from the loss of momentum portfolio investors (FPIs) as sentiments remained witnessed in H1. Industrial activity has recorded an weak. The Indian rupee has depreciated in line improvement over the previous quarter, as reflected with other emerging economies, weighed down by in the Purchasing Managers’ Index (PMI) in January. the strength of US dollar. Strong macroeconomic Pick-up in tractor sales growth, and fuel consumption, fundamentals, along with improvements in various and sustained growth in air passenger traffic also measures of external sector vulnerability, have helped point to a recovery in overall momentum. Rural India tide over the ongoing wave of global uncertainty. demand continues to hold up, buoyed by increasing Headline CPI inflation moderated to a five- farm incomes. In rural areas, sales of fast-moving month low of 4.3 per cent in January 2025 as food consumer good (FMCG) companies grew by 9.9 per prices, especially those of vegetables, recorded a sharp cent in Q3:2024-25, much higher than 5.7 per cent in decline driven by the arrival of winter crops in the Q2. Urban demand also exhibited a recovery with 5 market. Core (CPI excluding food and fuel) inflation per cent growth in Q3, being nearly double of 2.6 per has exhibited a gradual increase since May 2024 but cent in the previous quarter.7 The enterprise surveys remains below 4 per cent. conducted by the Reserve Bank corroborate this assessment (Annex 1). Listed non-government non- In the bimonthly monetary policy meeting of financial companies recorded acceleration in sales February 2025, the Monetary Policy Committee (MPC) growth during Q3 as per early results. On a sequential of the Reserve Bank reduced the policy repo rate by basis, operating profit margins have also turned out 25 bps to 6.25 per cent as growth-inflation dynamics to be higher in line with improved sales growth. opened up policy space to support growth, while remaining focussed on aligning inflation with the 5 IMF WEO January 2025 update. 6 IMF projects India to grow at 6.5 per cent during 2025 (WEO, January target. The MPC noted that excessive volatility in 2025), while World Bank pegs India’s growth at 6.7 per cent (GEP, January global financial markets and continued uncertainties 2025). 7 NielsenIQ India FMCG quarterly snapshot- Q4 2024. about global trade policies, coupled with adverse 20 RBI Bulletin February 2025State of the Economy ARTICLE weather events, pose risks to the growth and inflation Table II.1: GDP Growth Projections for 2025 – outlook. Accordingly, the MPC voted to continue with Select AEs and EMEs (Per cent) a neutral stance, which provides the flexibility to IMF World Bank respond to evolving macroeconomic conditions. Jan 2025 Oct 2024 Jan 2025 Jun 2024 Country (Latest) (Previous) (Latest) (Previous) Set against this backdrop, the remainder of the World* 3.3 3.2 3.2 3.2 article is structured into four sections. Section II Advanced Economies covers the rapidly evolving developments in the global US 2.7 2.2 2.3 1.8 economy. An assessment of domestic macroeconomic UK 1.6 1.5 - - conditions is set out in Section III. Section IV encapsulates financial conditions in India, while the Euro area 1.0 1.2 1.0 1.4 last Section sets out the conclusions. Japan 1.1 1.1 1.2 1.0 II. Global Setting Emerging Market Economies Brazil 2.2 2.2 2.2 2.2 The global economy continues to grow at a steady but moderate pace, although growth outlook Russia 1.4 1.3 1.6 1.4 diverges significantly across countries. In its January India# 6.5 6.5 6.7 6.7 2025 World Economic Outlook (WEO) update, the China 4.6 4.5 4.5 4.1 International Monetary Fund (IMF) revised the South growth forecast for 2025 to 3.3 per cent, up by 10 basis 1.5 1.5 1.8 1.3 Africa points (bps) vis-à-vis the October WEO outlook, while Note: *: PPP weighted. #: India’s data is on a fiscal year basis. Sources: IMF; and World Bank. retaining the global growth forecast for 2026 at 3.3 per cent. A broadly similar assessment is shared by the Our model-based nowcast of global GDP indicates World Bank in its latest Global Economic Prospects a marginal acceleration in global growth momentum (GEP) [Table II.1]. in Q4:2024 (Chart II.1). Chart II.1: Global GDP Growth Nowcast (Q-o-Q) Sources: CEIC; OECD; and RBI staff estimates. RBI Bulletin February 2025 21 tnec reP 2.5 2.0 1.5 0.8 0.9 1.0 0.6 0.5 0.6 0.0 0.5 -0.5 47 Countries OECD+ actual 86 Countries CEIC actual 86 Countries CEIC nowcast 1202-3Q 1202-4Q 2202-1Q 2202-2Q 2202-3Q 2202-4Q 3202-1Q 3202-2Q 3202-3Q 3202-4Q 4202-1Q 4202-2Q 4202-3Q 4202-4QARTICLE State of the Economy Global supply chain pressures moderated Financial conditions eased in major AEs but among in January 2025 (Chart II.2a). The geopolitical EMEs, they tightened in China and Brazil (Chart II.3c risk indicator experienced a sharp spike in mid- and II.3d). January 2025, driven by both increased global trade The global composite purchasing managers’ index protectionism and tensions in the Middle East. (PMI) moderated to a 12-month low in January 2025, However, it subsequently declined following the Gaza as the upturn in the manufacturing sector was offset ceasefire deal between Israel and Hamas (Chart II.2b). by a deceleration in the service sector business activity The Baltic Dry Index fell to a 23-month low at the end growth (Chart II.4). While the global manufacturing of January 2025 — its lowest level since February 2023 PMI returned to expansionary territory, reaching a — as freight rates declined across all vessel segments 7-month high, the global services PMI declined to a ahead of the traditionally slow Lunar New Year period 13-month low due to slower new business growth. in Asia. Concomitantly, shipping costs moderated in In January 2025, trade policy uncertainty reached January 2025 (Chart II.2c and II.2d). the highest level since the onset of the pandemic Consumer sentiments worsened in the US, the (Chart II.5), primarily driven by concerns of new trade UK, Japan and major EMEs, while it improved in restrictions, tariff increases, and tighter immigration the Euro area in January 2025 (Chart II.3a and II.3b). policies following the change in the US administration Chart II.2: Trends in Global Supply Chain Pressures and Geopolitical Risks a. Global Supply Chain Pressure Index (GSCPI) Notes: 1. GSCPI reflects data on transportation costs and manufacturing indicators. 2. The Baltic Dry Index provides a benchmark for the price of moving major raw materials by sea and consists of three sub-indices that measure different sizes of dry bulk carriers. 3. The WCI assessed weekly by Drewry reports actual spot container freight rates for major east west trade routes. The composite represents a weighted average of the 8 shipping routes by volume and is reported in USD per 40-foot container. Sources: Federal Reserve Bank of New York; BlackRock Investment Institute, January 2025; and Bloomberg. 22 RBI Bulletin February 2025 morf snoitaived dradnatS eulav egareva b. Geopolitical Risk Indicator xednI c. Baltic Dry Index d. Drewry World Container Index (WCI) xednI reniatnoc teef 04 rep $ SU 0.5 0.0 -0.3 0.6 -0.5 -1.0 792 3095 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 2500 2000 1500 1000 500 0 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 52-beF 1.2 1.0 0.8 0.6 0.4 0.2 0.0 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 6000 5500 5000 4500 4000 3500 3000 2500 2000 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 52-beFState of the Economy ARTICLE Chart II.3: Consumer Sentiment and Financial Conditions a. Consumer Sentiments (AEs) b. Consumer Sentiments (EMEs) and potential retaliatory measures from key trading The IMF has revised the world trade volume partners. (goods and services) growth downwards by 20 bps RBI Bulletin February 2025 23 xednI xednI xednI c. Financial Conditions Index (AEs) d. Financial Conditions Index (EMEs) xednI xednI 100 0 90 -5 -10 80 -14.2 -15 70 -20 60 71.1 -25 50 -22.0 -30 -35 40 -40 30 35.2 -45 20 -50 US Japan Eurozone (RHS) UK (RHS) Brazil China India US UK Euro zone Notes: 1. Japan: A score above 50 indicates consumer optimism, below 50 shows lack of consumer confidence and 50 indicates neutrality. 2. Euro zone and UK: -100 indicate extreme lack of confidence, 0 denotes neutrality while 100 indicates extreme confidence. 3. India and US: Higher the index value, higher is the consumer confidence. 4. For financial condition index (pertaining to EMEs constructed by Goldman Sachs), a reading below 100 is accommodative and vice versa. As for the AEs, the index constructed by Bloomberg is a z-score where a positive value indicates accommodative/easy financial conditions and vice versa. Source: Bloomberg. 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 2 1 0 -1 -2 22-voN 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 106 104 102 100 98 96 94 22-voN 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 100 98 96 93.7 94 92 90 88 86 84 86.486.2 82 80 1.7 104.4 1.0 0.8 101.4 96.6 Brazil China India 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Chart II.4: Global Purchasing Managers’ Index (PMI) Note: A level of 50 corresponds to no change in activity and a reading above 50 denotes expansion and vice versa. Source: S&P Global. xednI 54 52.2 52 51.8 50 50.1 48 Composite Manufacturing Services 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJARTICLE State of the Economy Chart II.5: Policy Uncertainty Index a. US Economic Policy Uncertainty b. Trade Policy Uncertainty 240 1508 225.7 200 160 120 80 Sources: NY Fed Fred Database; and Baker, Bloom, and Davis (2016). for 2025 to 3.2 per cent and by 10 bps for 2026 to 3.3 the US and the UK witnessed contraction (Chart II.6a per cent.8 The composite PMI for new export orders and II.6b). remained in contractionary territory in January 2025, Global commodity prices generally increased in despite a sequential pick-up driven by an increase in January as reflected in the Bloomberg commodity manufacturing export orders that offset the decline in services export orders. Export indices for Japan, index, which recorded a m-o-m increase of 3.6 per India, and China recorded expansion, while those of cent (Chart II.7a). Crude oil prices increased by 7.2 per 8 IMF WEO January 2025 update. 24 RBI Bulletin February 2025 12-naJ 12-yaM 12-peS 22-naJ 22-yaM 22-peS 32-naJ 32-yaM 32-peS 42-naJ 42-yaM 42-peS 52-naJ 1600 1200 800 400 0 xednI xednI 12-naJ 12-yaM 12-peS 22-naJ 22-yaM 22-peS 32-naJ 32-yaM 32-peS 42-naJ 42-yaM 42-peS 52-naJ Chart II.6: Global PMI: New Export Orders a. World b. Regional Comparisons (Composite) Note: A level of 50 corresponds to no change in activity and a reading above 50 denotes expansion and vice versa. Source: S&P Global. xednI xednI 52 51 56.3 50.2 50 49.6 50.2 50.1 49.4 49 49.7 47.7 48 47 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 60 56 52 48 44 Services Composite Manufacturing 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ India United Kingdom United States Japan ChinaState of the Economy ARTICLE Chart II.7: Commodity and Food Prices a. Bloomberg Commodity Index b. Brent Crude Oil cent (m-o-m) in January amidst fresh US sanctions on Inflation, in terms of the personal consumption Russia’s energy sector and cold weather pushing up expenditure (PCE) deflator also increased to 2.6 per demand (Chart II.7b). Base metal prices also increased cent in December from 2.4 per cent in November. in January, after China, the world’s largest consumer of Headline inflation in the Euro area accelerated to 2.5 base metals, indicated additional stimulus measures per cent in January from 2.4 per cent in December. to boost their economy. Precious metals, particularly Inflation in Japan (CPI excluding fresh food) increased gold prices, recorded sharp increases in January, to 3.0 per cent in December, while in the UK it inched supported by safe-haven demand amidst increased lower by 10 bps to 2.5 per cent (Chart II.8a). Among geo-economic and trade uncertainties (Chart II.7c). EMEs, CPI inflation in China rose to a five month high Food prices measured by the FAO’s food price index of 0.5 per cent in January; Russia and South Africa also declined by (-) 1.6 per cent in January 2025, primarily witnessed an increase in inflation in December while driven by decrease in the prices of sugar, vegetable in Brazil, it declined to 4.6 per cent in January (Chart oil and meat partially offset by increases in prices of II.8b). Core inflation remained steady in the Euro area dairy and cereals (Chart II.7d). in January 2025, but edged up marginally in the US. In the US, CPI inflation increased to 3.0 per cent Services inflation decreased in both the US and the (y-o-y) in January from 2.9 per cent in December. Euro area but remains elevated (Chart II.8c and II.8d). RBI Bulletin February 2025 25 xednI lbb /$SU c. Metals d. Food Prices )001=2202-dne( xednI )001=61-4102( xednI 95 90 85 80 75 70 65 Sources: Bloomberg; World Bank Pink Sheet; and FAO. 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 52-raM 52-yaM 52-luJ 52-peS 52-voN Futures as on Jan 13, 2025 Price Futures as on Feb 13, 2025 160 153.0 140 142.9 124.9 120 117.7 111.7 111.2 100 Gold Copper Iron 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 108 105.9 103 75.6 98 93 Food price index Meat Sugar Vegetable oil Cereals Dairy 32-luJ-60 32-guA-60 32-peS-60 32-tcO-70 32-voN-70 32-ceD-80 42-naJ-80 42-beF-80 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41 160 162.1 150 140 130 120 113.5 110 100 90 90.1 80 70 32-luJ-60 32-guA-60 32-peS-60 32-tcO-70 32-voN-70 32-ceD-80 42-naJ-80 42-beF-80 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41ARTICLE State of the Economy Chart II.8: Inflation - AEs and EMEs a. Headline - AEs b. Headline - EMEs Sources: Bloomberg; and OECD. The Morgan Stanley Capital International (MSCI) announcements of trade policy measures by the new world equity index surged by 3.3 per cent (m-o-m) US administration. The MSCI currency index for EMEs in January, with greater gains in AE equity markets mirrored movements in DXY with a depreciating bias over those in EMEs even as volatility remained high as capital outflows, particularly in the equity segment, on account of policy uncertainty (Chart II.9a). Yields exerted downward pressure (Chart II.9c and II.9d). on the US government securities hardened in the Divergent macroeconomic conditions are reflected first fortnight of January as data releases such as in monetary policy actions across countries. Among strong retail sales and industrial production prints AE central banks, the US, South Korea and Norway amidst low unemployment indicated underlying kept their policy rates unchanged. In contrast, the strength in the US economy. Yields softened in the Euro area, Canada, and Sweden cut their policy rates second half, as inflation data releases and Federal by 25 bps in January while the UK and Czech Republic Open Market Committee (FOMC) statement helped lowered their key rates by 25 bps in February (Chart ease uncertainty. Yields again moved higher in II.10a). Japan, however, hiked its policy rate by 25 bps. February on higher than expected CPI inflation (Chart Among EME central banks, China, Chile, Hungary, II.9b). The US dollar index (DXY) appreciated in the Columbia, Malaysia, Philippines and Peru maintained their policy rates. South Africa and Indonesia lowered first half of January but gave up some of its gains their policy rates by 25 bps in January 2025 while subsequently. DXY remained volatile, responding to 26 RBI Bulletin February 2025 tnec reP tnec reP c. Core d. Services tnec reP tnec reP 8 7 6 5 4 3.0 3 2.6 2.5 2 2.5 1 0 Brazil China India US (PCE) UK Euro area Japan Russia South Africa US (PCE) UK Euro area Japan US UK Euro Area Japan 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 10 9.5 9 8 7 6 5.2 5 4.6 4 3 3.0 2 1 0.5 0 -1 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 7 6 5 4 3.2 3.3 3 2.7 2 1.6 1 0 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 8 7 6 5 4.4 4.2 4 3.9 3 2 1.6 1 0 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJState of the Economy ARTICLE Chart II.9: Global Financial Markets a. Equity Indices (MSCI) b. US Government Bond Yields Sources: Bloomberg; and IIF. Mexico and India cut their benchmark rates by 50 on the other hand, hiked it by 100 bps in January bps and 25 bps, respectively, in February. Brazil, (Chart II.10b). RBI Bulletin February 2025 27 tnec reP World AEs EMEs 10-year 2-year Spread (10yr-2yr) c. Currency Indices d. Portfolio Flows to EMEs xednI xednI MSCI EME currency index Dollar index (RHS) noillib$SU Debt Equity Total )001=1202-dne enuJ( xednI 15 10 5 -1 -6 -11 -16 32-luJ-6 32-guA-6 32-peS-6 32-tcO-7 32-voN-7 32-ceD-8 42-naJ-8 42-beF-8 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41 130 129.2 122.8 120 110 100 90 81.9 80 70 60 -0.7 -4.6 -5.3 32-luJ-60 32-guA-60 32-peS-60 32-tcO-70 32-voN-70 32-ceD-80 42-naJ-80 42-beF-80 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41 5.5 5.0 4.5 4.48 4.0 4.26 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.22 0.0 -0.5 -1.0 -1.5 32-luJ-60 32-guA-60 32-peS-60 32-tcO-70 32-voN-70 32-ceD-80 42-naJ-80 42-beF-80 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41 110 1,790 1,770 108 106.7 1,750 106 1,730 104 1749.7 1,710 102 1,690 1,670 100 1,650 98 32-luJ-60 32-guA-60 32-peS-60 32-tcO-70 32-voN-70 32-ceD-80 42-naJ-80 42-beF-80 42-raM-01 42-rpA-01 42-yaM-11 42-nuJ-11 42-luJ-21 42-guA-21 42-peS-21 42-tcO-31 42-voN-31 42-ceD-41 52-naJ-41 52-beF-41 Chart II.10: Changes in Policy Rates a. AEs b. EMEs Source: Bloomberg. stniop sisaB Q1:2024 Q2:2024 Q1:2024 Q2:2024 Q3:2024 Q4:2024 Q3:2024 Q4:2024 Q1:2025 (till 12 Feb, 2025) Q1:2025 (till 12 Feb, 2025) stniop sisaB 0 0 -25 -100 -75 -75 -100 -125 -125 -125 -125 -200 -175 -200 -300 -300 ailartsuA adanaC dnalreztiwS cilbupeR hcezC kramneD modgniK detinU learsI napaJ yawroN dnalaeZ weN aibreS nedewS setatS detinU aerA oruE 150 50 -25-25 0 -50 -35 150 -75 -150 -75 -100 -250 -175 -200 -350 -325 -350 -450 lizarB elihC anihC aibmoloC aisenodnI aidnI ocixeM aisyalaM ureP senippilihP aibarA iduaS acirfA htuoSARTICLE State of the Economy III. Domestic Developments Aggregate Demand The Indian economy is regaining its growth High frequency indicators suggest that aggregate momentum driven by recovery in consumption demand is recovering from the slowdown witnessed demand and overall investment. As per the latest in H1. E-way bills growth accelerated to 23.1 per cent RBI survey in January 2025, consumer confidence in January (Chart III.2a). Toll collections recorded remains upbeat with the future expectations index strong growth both in volume and value terms (Chart (FEI) remaining firmly in optimistic territory albeit III.2b). a slight sequential moderation although the current Wholesale automobile sales experienced a situation index (CSI), remained in pessimistic territory turnaround in January, registering a growth of 2.5 per (Chart III.1a). Supply chain pressures remained below cent y-o-y, following two months of contraction (Chart historical average levels, despite a marginal uptick III.3a). The two-wheeler segment saw a recovery, in January (Chart III.1b). The economic activity index, constructed by extracting the common trend primarily driven by a surge in scooter sales although underlying twenty-seven high frequency indicators, motorcycle sales contracted for the third consecutive indicates that activity sustained its pace in January month (Chart III.3b). Tractor sales recorded double and the GDP nowcast for Q4:2024-25 is placed at 6.6 digit growth for the second consecutive month. Vehicle per cent (Chart III.1c and Chart III.1d). registrations recorded an expansion in January, Chart III.1: Economic Activity Indicators Notes: 1. The economic activity index (EAI) is constructed by extracting the common trend underlying twenty-seven high frequency indicators of economic activity using a Dynamic Factor Model. EAI is scaled to 100 in February 2020 and 0 in April 2020, the worst affected month due to mobility restrictions. 2. For GDP Nowcast, implicit number is available from first advance estimates (FAE). Sources: National Statistical Office (NSO); and RBI staff estimates. 28 RBI Bulletin February 2025 xednI xednI egareva morf snoitaiveD radnatS )tnec rep ni( y-o-Y a. Consumer Confidence Indices b. Index of Supply Chain Pressures for India 140 120.7 120 100 93.7 80 -0.15 60 Current situation index Future expectations index c. Economic Activity Index d. GDP - Actual and Nowcast 147.9 22-peS 22-voN 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 3 2 1 0 -1 -2 -3 01-naJ 11-naJ 21-naJ 31-naJ 41-naJ 51-naJ 61-naJ 71-naJ 81-naJ 91-naJ 02-naJ 12-naJ 22-naJ 32-naJ 42-naJ 52-naJ 140 120 100 80 60 40 20 0 GDP Nowcast 02-naJ 02-nuJ 02-voN 12-rpA 12-peS 22-beF 22-luJ 22-ceD 32-yaM 32-tcO 42-raM 42-guA 52-naJ 30 20 10 6.6 0 -10 -20 -30 81-nuJ 91-raM 91-ceD 02-peS 12-nuJ 22-raM 22-ceD 32-peS 42-nuJ 52-raMState of the Economy ARTICLE Chart III.2: E-way Bills and Toll Collections a. E-way Bills b. Toll Collections GST E-way bill inter-state E-way bills growth (RHS) GST E-way bill intra-state Sources: GSTN; and RBI. driven by an increase in both non-transport and consumption expanded by 3.1 per cent (y-o-y) in transport vehicles segments (Chart III.3c). Petroleum January (Chart III.3d). RBI Bulletin February 2025 29 stinu noilliM y-o-y ,tnec reP )001=9102( xednI y-o-y ,tnec reP 140 35 120 30 100 25 80 20 60 15 40 10 20 5 0 0 Volume Volume growth (RHS) Value Value growth (RHS) 1.24 23.1 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 0.67 52-naJ 50 40 30 20 10 0 4321 489 1400 1200 1000 800 19.0 600 400 14.8 200 0 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ Chart III.3: Automobile Sector Indicators a. Automobile Sales b. Rural Demand d. Petroleum Consumption noillim ni rebmuN y-o-y ,tnec reP sennot noilliM y-o-y ,tnec reP Total automobile sales Automobile sales growth (RHS) c. Vehicle Registrations sdnasuohT y-o-y ,tnec reP snoilliM sdnasuohT 160 140 120 100 80 60 40 20 0 Motorcycle sales Three wheeler sales (RHS) Tractor sales (RHS) Source: Society of Indian Automobile Manufacturers (SIAM). Sources: SIAM; and Tractor and Mechanization Association (TMA). Petrol Growth in average daily petroleum Non-transport vehicles Total registrations growth (RHS) Diesel consumption (RHS) Transport vehicles ATF Source: Ministry of Road Transport and Highways. Source: Petroleum Planning and Analysis Cell. 9.0 61.9 58.2 5.0 2.5 2.0 1.5 1.0 0.5 0.0 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Scooters 3.5 45 3.0 35 2.5 2.0 25 2.0 15 1.5 6.5 5 1.0 0.5 -5 0.0 0.2 -15 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 14 12 12 10 10 3.3 8 6 8 3.1 4 6 2 0 4 7.7 -2 2 -4 0 0.8 -6 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 3000 35 30 2500 25 2000 1936 20 15 1500 10 1000 2.5 5 0 500 -5 0 -10 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJARTICLE State of the Economy Chart III.4: State-wise EV Adoption Rates Source: ‘Vahan Dashboard’. India has seen a growing adoption of electric The PM Electric Drive Revolution in Innovative vehicles (EVs) in the past few years. In 2024, the share Vehicle Enhancement (PM E-DRIVE) scheme launched of EVs in total vehicle registrations increased to more in September 2024 aims to incentivise the adoption of than 7 per cent from less than 2 per cent in 2021. EVs and has made provision for the development of States/UTs such as Assam, Delhi, Goa, Karnataka, and Electric Vehicle Public Charging Stations (EVPCS)10. As Tripura have seen relatively higher EV adoption rates9 of December 2024, Karnataka had the highest EVPCS, (Chart III.4). followed by Maharashtra and Uttar Pradesh (Chart III.5). 9 Adoption rates are calculated by dividing total EVs registration with total vehicle registration in the corresponding state for the period from January 2019 to February 2025. 10 An outlay of ₹10,900 crore for a two-year period was provided, out of which ₹2,000 crore has been kept for EVPCS. 30 RBI Bulletin February 2025 noitartsiger elcihev latot fo tnec rep sA 9 8.2 8.5 8 7.1 7 6.5 6 5.4 5.2 5 4.7 4.6 4.8 4.4 4.0 4 3.6 3.6 3.3 3.0 3.0 3 2.7 2.6 2.7 2.6 2.3 2.2 2 1.8 1 0 arhdnA hsedarP massA rahiB hragsittahhC ihleD aoG tarajuG anayraH dnAummaJ rimahsaK dnahkrahJ akatanraK alareK ayhdaM hsedarP arthsarahaM ahsidO yrrehcuduP bajnuP nahtsajaR udaN limaT arupirT hsedarPrattU dnahkarattU lagneB tseW Chart III.5: Number of EV Public Charging Stations Source: Ministry of Heavy Industries, PIB release dated December 20, 2024. snoitatS gnigrahC cilbuP VE 7000 5765 6000 5174 5000 4000 3728 3000 1989 1941 2000 1413 1212 1129 992 956 903 1000 0 akatanraK arthsarahaM hsedarP rattU ihleD udaN limaT alareK nahtsajaR tarajuG anagnaleT hsedarP ayhdaM setatS rehtOState of the Economy ARTICLE Chart III.6: PMI Employment Indices Note: A PMI value above 50 indicates expansion. Source: S&P Global. In January 2025, employment in the organised (MGNREGS) rose for the third consecutive month in manufacturing sector grew at a record pace since January 2025 by 14.4 per cent (y-o-y) as rabi sowing the PMI survey’s inception, while job creation in the came to close (Chart III.7). services sector was also among the strongest in the series11 (Chart III.6). India’s merchandise exports at US$ 36.4 billion contracted by 2.4 per cent (y-o-y) in January 2025, The demand for work under the Mahatma Gandhi National Rural Employment Guarantee Scheme mainly due to a decline in oil exports (Chart III.8). 11 The survey began in 2005. RBI Bulletin February 2025 31 )egnahc oN=05( xednI 58 57 56.3 56 55 54.8 54 53 52 51 50 49 48 32 ceD 42 naJ 42 beF 42 raM 42 rpA 42 yaM 42 nuJ 42 luJ 42 guA 42 peS 42 tcO 42 voN 42 ceD 52 naJ Manufacturing Services Chart III.7: Households’ Demand for Work under MGNREGA Source: Ministry of Rural Development. erorC 5.0 4.5 4.0 3.5 3.0 2.6 2.5 2.3 2.22.1 2.0 2.0 1.9 1.5 1.0 0.5 0.0 Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25ARTICLE State of the Economy Chart III.8: India's Merchandise Exports a. Trend in Exports b. Decomposition of Sequential Change in Export Growth (y-o-y) Note: POL: Petroleum, oil and lubricants. Sources: PIB; DGCI&S; and RBI staff estimates. The contraction remained contained in a few During April-January 2024-25, India’s merchandise product groups as exports of only 5 out of 30 major exports expanded by 1.4 per cent to US$ 358.9 billion, commodities (accounting for 27.6 per cent of export primarily led by engineering goods, electronic goods, basket) declined on y-o-y basis. Among the major rice, and drugs and pharmaceuticals, while petroleum groups, petroleum products and iron ore contributed products, gems and jewellery and iron ore dragged negatively, while electronic goods, engineering exports down. goods, and drugs and pharmaceuticals lent support Exports to 10 out of 20 major destinations (Chart III.9). expanded in January 2025. During April-January 2024-25, exports to 15 out of 20 major destinations expanded , with the US, the UAE and the Netherlands being the top three export destinations. Merchandise imports at US$ 59.4 billion increased by 10.3 per cent (y-o-y) in January (Chart III.10). Out of 30 major commodities, 26 commodities (accounting for 59.7 per cent of import basket) registered an expansion on y-o-y basis. Electronic goods, electrical and non-electrical machinery and gold were the major groups which contributed positively, while petroleum, crude and products and pearls, precious and semi-precious stones were the major groups that contributed negatively (Chart III.11). 32 RBI Bulletin February 2025 noillib $SU tnec reP tnec reP Non-POL Y-o-y, growth (RHS) POL M-o-m, growth (RHS) Base effect Momentum ∆ in y-o-y growth 9.23 6.3 45 40 40 30 35 30 20 25 10 20 15 - 0 2.4 10 -4.2 -10 5 0 -20 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 25 20 15 10 5 2.8 0 -1.4 -5 -4.3 -10 -15 -20 -25 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ Chart III.9: India's Merchandise Exports – Relative Contribution (January 2025 over January 2024) Electronic Goods 4.9 Engineering Goods 1.7 Drugs & Pharmaceuticals 1.2 Rice 1.1 Gems & Jewellery 1.1 Oil seeds 0.0 Organic & Inorganic Chemicals -0.1 Oil Meals -0.2 Iron Ore -1.1 -13.5 Petroleum Products -15 -13 -11 -9 -7 -5 -3 -1 1 3 5 Sources: PIB; and RBI staff estimates.State of the Economy ARTICLE During April-January 2024-25, India’s merchandise major source countries expanded during April-January imports at US$ 609.1 billion increased by 7.4 per cent 2024-25. Import from major source countries, viz., China, Russia, and the UAE recorded a growth during (y-o-y), mainly led by gold, petroleum, crude and April-January 2024-25. products and electronic goods, while imports of coal, coke and briquettes, etc., pearls, precious and semi- Merchandise trade deficit widened to US$ 23.0 billion in January 2025 from US$ 16.6 billion in precious stones and iron and steel fell. January 2024. Both oil and non-oil deficit turned out Imports from 13 out of 20 major source countries to be higher in January as compared with a year ago expanded in January, and imports from 15 out of 20 (Chart III.12). The share of oil deficit in overall trade Chart III.12: Decomposition of India’s Merchandise Trade Deficit Sources: PIB; and DGCI&S. RBI Bulletin February 2025 33 noillib $SU tnec reP Non-oil deficit Share of oil in trade deficit (RHS) Oil deficit 9.6 6.9 7.8 8.01 9.01 4.4 5.9 7.9 8.11 2.01 6.9 3.11 7.8 3.41 3.5 8.22 0.8 7.11 9.31 3.01 2.21 6.91 4.01 6.11 9.9 1.31 35 80 30 70 60 25 50 20 42.9 40 15 30 10 20 5 10 0 0 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Chart III.10: India's Merchandise Imports a. Trend in Imports b. Decomposition of Sequential Change in Import Growth (y-o-y) Chart III.11: India's Merchandise Imports – Relative Contribution (January 2025 over January 2024) Electronic goods 2.6 Machinery, electrical & 1.9 non-electrical Gold 1.4 Organic & Inorganic 1.3 Chemicals Chemical material & 1.0 products Newsprint 0.0 Project goods -0.2 Coal, Coke & Briquettes, etc. -0.9 Pearls, precious & Semi- -0.9 precious stones Petroleum, Crude & -3.9 products -6 -4 -2 0 2 4 Percentage points Sources: PIB; and RBI staff estimates. noillib $SU tnec reP Non-POL non-gold Y-o-y, growth (RHS) Gold M-o-m, growth (RHS) POL Base effect Momentum ∆ in y-o-y growth Sources: PIB; DGCI&S; and RBI staff estimates. 3.34 4.31 tnec reP 70 60 60 50 40 50 30 40 20 30 10.3 10 20 -0.9 0 2.7 10 -10 0 -20 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 30 20 10 5.9 5.0 0 -0.9 -10 -20 -30 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJARTICLE State of the Economy Chart III.14: Services Exports and Imports: Growth Rates Source: RBI. deficit was 42.9 per cent in January as compared with Amongst expenditure components, revenue 41.8 per cent a year ago. expenditure recorded a y-o-y growth of 7.0 per cent During April-January 2024-25, India’s merchandise in April-December 2024 in comparison to 2.3 per trade deficit widened to US$ 243.0 billion from US$ cent growth during the corresponding period of 206.3 billion a year ago. Petroleum products were the the previous year. Driven by food and petroleum largest source of deficit, followed by electronic goods subsidies, the expenditure outgo on major subsidies and gold (Chart III.13). recorded a growth of 10.9 per cent, in comparison to a contraction of 21.0 per cent during the corresponding During December 2024, services exports robustly grew by 16.5 per cent (y-o-y) to US$ 36.9 billion while period of the previous year. Revenue expenditure net services imports expanded by 16.5 per cent (y-o-y) of interest payments and subsidies grew by 5.6 per to US$ 17.8 billion (Chart III.14). Net services export cent (y-o-y) as compared with 4.5 per cent a year ago. earnings rose by 19.2 per cent (y-o-y) to an all-time Capital expenditure recovered in November high of US$ 19.1 billion during the month. and December 202413, taking the y-o-y growth rate During April-December 2024, the gross fiscal to 1.7 per cent during April-December 2024 (Chart deficit (GFD) and revenue deficit (RD) in absolute III.16a). Among the top six ministries, which together terms were lower than the corresponding period of account for around 95 per cent of the budgeted the previous year12; while they were higher as per capital expenditure for 2024-25, Road Transport cent of the revised estimates (RE). The gross primary and Highways, Railways, Finance, and Housing and deficit remained lower than the corresponding period Urban Affairs registered expansion on a y-o-y basis of the previous year, both in absolute terms and as per while Defence, and Communications registered a cent of RE (Chart III.15a and 15b). 13 On a y-o-y basis, capital expenditure registered an expansion of 21.3 per 12 According to the Controller General of Accounts (CGA). cent and 95.3 per cent during November and December 2024, respectively. 34 RBI Bulletin February 2025 )y-o-y( tnec reP 35 30 25 20 16.5 15 13.8 10 5 0 -5 -10 -15 Exports Imports 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD Chart III.13: Commodity-wise Merchandise Trade Deficit Note: Coal, coke and briquettes exports in January 2025 and December 2024 are assumed to be at the same level as in November 2024. Sources: PIB; DGCI&S; and RBI staff estimates. noillib $SU 300 243.0 250 22.4 206.3 200 18.7 26.6 32.3 51.5 150 50.8 40.8 100 29.6 50 101.8 75.0 0 2023-24 (April-January) 2024-25 (April-January) Petroleum products Others Electronic goods Coal, coke and briquettes GoldState of the Economy ARTICLE contraction (Chart III.16b). Overall, the growth in tax (GST), and custom duties (Chart III.17a). Non-tax total expenditure stood at 5.8 per cent during April- revenue attained 84.3 per cent of RE, attributable December 2024 vis-à-vis 8.4 per cent during the to the surplus transfer of ₹2.11 lakh crore from corresponding period of the previous year. the Reserve Bank (Chart III.17b). Non-debt capital Gross tax revenues of the Central government receipts, however, contracted due to decline in both grew by 10.8 per cent (y-o-y) in April-December 2024, recovery of loans and disinvestment receipts. The primarily driven by income tax, goods and services net tax revenue of the Union government increased Chart III.16: Capital Expenditure b. Ministry-wise Capital Expenditure Source: CGA. RBI Bulletin February 2025 35 erorc dnasuoht ₹ 270 233 219 220 191 185 170 120 102 10495 75 70 42 1825 20 6 -30 2023-24 2024-25 tropsnarT daoR fo yrtsiniM syawhgiH dna syawliaR fo yrtsiniM ecnaniF fo yrtsiniM ecnefeD fo yrtsiniM snoitacinummoC fo yrtsiniM gnisuoH fo yrtsiniM sriaffA nabrU dna a. Month-wise Capital Expenditure erorc dnasuoht ₹ )tnec rep( htworg y-o-Y 200 150 172 95.3 100 150 111 117114 50 99 100 89 88 78 80 0 50 44 3739 57 40 56 52 3947 -50 0 -100 2024-25 2023-24 Y-o-y growth rate (RHS) lirpA yaM enuJ yluJ tsuguA rebmetpeS rebotcO rebmevoN rebmeceD Chart III.15: Budgetary Deficit of Central Government during April-December a. Absolute Size b. Per cent of RE erorc dnasuoht ₹ EB fo tnec reP 1200 993 982 56.6 56.6 58.2 1000 914 50.3 47.7 800 759 42.0 40.2 38.3 36.4 34.5 600 558 24.9 24.5 396 400 312 338 256 234 194 200 106 0 Gross primary deficit Gross fiscal deficit Revenue deficit Gross primary deficit Gross fiscal deficit Revenue deficit Sources: Controller General of Accounts (CGA); and Union Budget Documents. 22-1202 32-2202 42-3202 52-4202 70 60 50 40 30 20 10 0 22-1202 32-2202 42-3202 52-4202ARTICLE State of the Economy by 6.5 per cent during April-December 2024. Overall, transactions14 grew by 10.0 per cent (y-oy), while that the total receipts expanded by 11.9 per cent over the on imports grew by 19.8 per cent. With tax refund for January 2025 growing by 23.9 per cent, the net corresponding period of the previous year. GST collections rose by 10.9 per cent to ₹1.72 lakh GST collections (Centre plus States) grew by 12.3 crore. The cumulative gross GST collections for April- per cent (y-o-y) in January 2025 to reach ₹1.96 lakh January 2024-25 were 9.4 per cent higher than the crore (Chart III.18). The collection from domestic corresponding period a year ago. Chart III.18: GST Collection Sources: Press Information Bureau (PIB); and GST Portal. 14 Collection from domestic transactions accounted for 75.3 per cent of the gross GST collection during January 2025. 36 RBI Bulletin February 2025 erorc dnasuoht ₹ 250 210 200 187 196 172 174 178 173 174 182 175 173 187 182 177 157 161 165 159 163 168 165 168 150 100 50 0 32 rpA 32 yaM 32 nuJ 32 luJ 32 guA 32 peS 32 tcO 32 voN 32 ceD 42 naJ 42 beF 42 raM 42 rpA 42 yaM 42 nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Chart III.17: Revenue Receipts of the Central Government during April-December a. Tax Revenue b. Non-Tax Revenue Source: CGA. )tnec rep( htworg y-o-Y ER fo tnec reP erorc dnasuoht ₹ ER fo tnec reP 80 50 448 75.6 70 69.7 70.9 72.4 84.3 40 64.4 60 50 30 312 40 22.2 259 20 30 214 10.1 20 10 7.6 2.7 10 0 0 -1.4 Growth rate Actuals (RHS) Actuals Per cent of RE (RHS) noitaroproC xat emocnI xat TSG smotsuC seitud esicxe noinU seitud 500 100 450 90 400 80 350 70 300 60 250 50 200 40 150 30 100 20 50 10 0 0 Direct tax Indirect tax 22-1202 32-2202 42-3202 52-4202State of the Economy ARTICLE The Union Budget 2025-26, announced on February Table III.1: States’ Fiscal Indicators 1, 2025, reaffirmed the government’s commitment (April-December) (per cent of BE) towards fiscal consolidation, with GFD placed at 4.4 Deficit Indicators 2022-23 2023-24 2024-25 per cent of GDP in 2025-26 (BE), below 4.8 per cent Revenue deficit 4.2 52.3 98.3 of GDP in 2024-25 (RE). The proposed consolidation Gross fiscal deficit 39.9 52.1 54.8 is sought to be achieved through retrenchment of Primary deficit 15.0 39.9 44.9 revenue expenditure to 11.0 per cent of GDP (vis-à- Note: Data pertains to 23 States. BE: Budget Estimates vis 11.4 per cent in 2024-25 RE), maintaining capital Source: Comptroller and Auditor General of India. expenditure at 3.1 per cent of GDP (with effective States’ revenue receipts increased by 9.1 per cent, capital expenditure higher at 4.3 per cent of GDP)15 while boosting gross tax revenues to 12.0 per cent of largely driven by higher tax revenues, even though GDP (vis-à-vis 11.9 per cent in 2024-25 RE). From 2026- grants from the Union government contracted (Chart 27 to 2030-31, the Union government endeavours to III.19a). Growth in States’ GST (SGST) and State excise keep fiscal deficit each year such that its debt is on moderated slightly, while Sales Tax/VAT saw a positive declining path to attain a debt to GDP level of about turnaround compared to last year. States’ revenue 50 ±1 per cent by March 31, 2031. expenditure recorded a double-digit growth, while As per provisional accounts, States’ key deficit capital expenditure declined during this period (Chart indicators as per cent of the budget estimates (BE) III.19b). Accordingly, the RECO16 ratio climbed up to during April-December 2024 are higher than last year’s 7.0 in April-December 2024, from 6.0 in the same level (Table III.1). period last year. Chart III.19: Key Fiscal Performance Indicators (April-December) a. Growth in Receipts b. Growth in Expenditure 15 Effective capital expenditure is capital expenditure plus grants-in-aid for creation of capital assets. 16 Revenue expenditure to capital outlay. RBI Bulletin February 2025 37 )tnec rep ni( etar htworg y-o-Y )tnec rep ni( etar htworg y-o-Y 40 40 33.6 30 27.4 35 22.9 30 20 17.518.2 13.6 9.1 12.8 25 10 7.4 6.7 1.6 20 0 15 11.712.1 12.2 11.9 -10 9.9 9.0 8.7 10 -13.5 -20 5 -30 -27.7 0 -1.5 -40 -5 Revenue Tax Non-tax Grants Total Revenue Capital receipts revenues revenues expenditure expenditure expenditure 2022-23 2023-24 2024-25 2022-23 2023-24 2024-25 Note: Data pertains to 23 States. Source: CAG.ARTICLE State of the Economy Aggregate Supply The reservoir level (based on 155 major reservoirs) remains in a comfortable position at 58 per cent of Area sown during rabi season 2024-25 stood at the total reservoir capacity (as of February 13, 2025), 661 lakh hectares, 1.5 per cent higher as compared to last year. Area under wheat, which accounts for nearly which is higher than the previous year as well as the half of the area sown under normal rabi area, grew decadal average levels (Chart III.22). Comfortable by 2.1 per cent (Chart III.20). The expansion in pulses reservoir position allays some of the concerns for rabi sowing was mainly driven by higher area under gram. crops stemming from low winter rainfall (January- March) in the country17. As per the first advance estimates, the production of horticultural crops during 2024-25 is placed at 362.1 As on February 01, 2025, the stock of rice held million tonnes, 2.1 per cent higher than the final by the Food Corporation of India (FCI) stood at 676 estimates of 2023-24. The y-o-y increase was driven by lakh tonnes - nine times the buffer requirements. The higher production of onion and potato (Chart III.21). government reduced the reserve price of rice under The Union Budget 2025-26 has focused on the open market sales scheme (OMSS) to ₹2,250 from important areas such as enhancing productivity ₹2,800 per quintal for sale to state governments and and sustainability in agriculture and improving ethanol distilleries. Wheat stock at 162 lakh tonnes agricultural infrastructure. It announced the launch of is 22 per cent higher than last year and is in line ‘Prime Minister Dhan-Dhaanya Krishi Yojana’ in 100 with the buffer norms. Rice procurement during the low productivity districts to enhance their agricultural current marketing season at 443 lakh tonnes (as on productivity, improve irrigation facilities, augment February 16, 2025) is 3.4 per cent higher than last year post-harvest storage and facilitate availability of (Chart III.23). long-term and short-term credit for around 1.7 crore farmers. It also announced the launch of a 6-year “Mission for Aatmanirbharta in Pulses” with special focus on tur, urad and masoor. 17 Winter rainfall was 70 per cent below the long period average as of February 12, 2025. 38 RBI Bulletin February 2025 tnec reP Chart III.20: Status of Rabi Sowing (as on January 31, 2025) Source: Ministry of Agriculture and Farmers’ Welfare. eratceh hkaL Chart III.21: Horticulture Production 350 325 6 318 5 300 4.8 4 250 3 200 2.1 2.2 2 150 138141 1 0 100 -0.4 99 98 -1 50 41 43 56 55 -1.8 -2 0 -3 Wheat Rice Pulses Coarse Oilseeds Note: *: includes plantation crops, spices, flowers, aromatic and medicinal plants. cereals Source: Ministry of Agriculture and Farmers’ Welfare. 2023-24 2024-25 Y-o-y growth (RHS) tnec reP 25 18.9 20 15 10 5.6 3.6 4.4 4.5 5 2.5 2.1 0.2 1.1 0 -5 -2.5 -0.8 -0.2 -5.0 -10 -15 -20 -19.5 -25 Total Total Onion Potato Tomato Others* Total fruits vegetables horticulture 2023-24 over 2022-23 2024-25 (First Advance Estimates) over 2023-24State of the Economy ARTICLE India’s manufacturing PMI reached a six-month Port traffic increased from 3.4 per cent in high in January, driven by new orders (domestic December 2024 to 6.6 per cent in January 2025, driven by fertilisers, containerised cargo, and other and export) and employment (Chart III.24a). The miscellaneous cargo (Chart III.25). services PMI, however, moderated due to a slowdown In the construction sector, steel consumption in new business activity (Chart III.24b). Business growth accelerated to 5.8 per cent (y-o-y) in January expectations for manufacturing improved, while while the cement production levels reached a nine- future output assessments for services dropped to a month high, growing by 4.0 per cent in December three-month low. (Chart III.26). Chart III.24: Purchasing Managers’ Index (PMI) a. Manufacturing b. Services RBI Bulletin February 2025 39 egnahc oN = 05 egnahC oN = 05 70 65 65.1 60 57.7 55 50 45 Note: A level of 50 corresponds to no change in activity and a reading above 50 denotes expansion and vice versa. Source: S&P Global. 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 70 65 63.4 60 56.5 55 50 45 PMI Future output PMI Future activity 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Chart III.23: Procurement and Stocks of Foodgrains Note: *: Rice procurement is as on February 16 and wheat procurement is as on June 30; #: As on February 01. Source: Food Corporation of India. sennot hkaL Chart III.22: Reservoir Level (as on February 13, 2025) 800 676 700 577 600 500 428 443 400 300 262 266 200 162 133 100 0 KMS 2023-24 KMS 2024-25 RMS 2023-24 RMS 2024-25 Rice Wheat Procurement* Stock# Source: Central Water Commission. level riovreser lluf fo tnec reP 80 70 70 61 60 57 5757 58 57 58 55 53 50 50 4847 4343 42 40 32 32 30 20 10 0 nrehtroN nretsaE nretseW lartneC nrehtuoS aidnI llA Last 10 years average 2024 2025ARTICLE State of the Economy Chart III.26: Steel Consumption and Cement Production Sources: Joint Plant Committee; Office of the Economic Adviser; and Ministry of Commerce and Industry. Available high frequency indicators for the with most indicators showing improvement in y-o-y services sector reflect resilience in economic activity growth (Table III.2). Table III.2: High Frequency Indicators-Services (y-o-y, per cent) Sector Indicator Feb-24 Mar-24 Apr-24 May-24 Jun-24 Jul-24 Aug-24 Sep-24 Oct-24 Nov-24 Dec-24 Jan-25 Urban demand Passenger Vehicles Sales 9.5 8.9 1.2 4.3 4.9 -2.0 -1.6 -0.4 1.1 4.4 11.4 3.5 Two-Wheeler Sales 34.6 15.3 30.8 10.1 21.3 12.5 9.3 15.8 14.2 -1.1 -8.8 2.1 Rural demand Three-Wheeler Sales 8.3 4.3 14.5 14.4 12.3 5.1 8.0 6.7 -0.7 -1.3 3.5 7.7 Tractor Sales -30.6 -23.1 -3.0 0.0 3.6 1.6 -5.8 3.7 22.4 -1.3 14.0 11.4 Commercial Vehicles Sales -3.8 3.5 -10.9 1.3 Railway Freight Traffic 10.1 8.6 1.4 3.7 10.1 4.5 0.0 Port Cargo Traffic 2.1 2.7 1.3 3.8 6.8 5.9 6.7 5.8 -3.4 -4.9 3.4 6.6 Domestic Air Cargo Traffic 11.5 8.7 0.3 10.3 10.3 8.8 0.6 14.0 8.9 0.3 4.3 International Air Cargo Traffic 30.2 22.5 16.2 19.2 19.6 24.4 20.7 20.5 18.4 16.1 10.5 Trade, hotels, Domestic Air Passenger Traffic * 5.8 4.7 3.8 5.9 6.9 7.6 6.7 7.4 9.6 13.8 10.8 14.1 transport, International Air Passenger Traffic * 19.3 15.0 16.8 19.6 11.3 8.8 11.1 11.2 10.3 10.7 9.0 9.8 communication GST E-way Bills (Total) 18.9 13.9 14.5 17.0 16.3 19.2 12.9 18.5 16.9 16.3 17.6 23.1 GST E-way Bills (Intra State) 21.1 15.8 17.3 18.9 16.4 19.0 13.1 19.0 18.3 5.4 17.9 23.3 GST E-way Bills (Inter State) 15.0 10.7 9.6 13.6 16.3 19.6 12.5 17.7 14.4 44.1 17.1 22.8 Hotel occupancy 1.8 2.7 -1.4 -2.6 -3.1 3.6 0.7 2.1 -5.3 11.1 -0.2 Average revenue per room 7.8 6.7 4.8 1.8 2.8 7.6 5.2 3.5 4.8 10.7 8.9 Tourist Arrivals 15.8 8.0 7.7 0.3 9.0 -1.3 -4.2 0.4 -1.4 Steel Consumption 7.0 12.5 9.6 15.9 19.5 14.4 10.0 11.8 8.9 9.5 5.2 5.8 Construction Cement Production 7.8 10.6 0.2 -0.6 1.8 5.1 -2.5 7.6 3.1 13.5 4.0 PMI Index# Services 60.6 61.2 60.8 60.2 60.5 60.3 60.9 57.7 58.5 58.4 59.3 56.5 << Contraction ------------------------------------- Expansion >> Note: #: Data in levels. *: December 2024 data are based on the monthly average of daily figures. The Heat-map is constructed for each indicator for the period July-2021 till date. Sources: SIAM; Ministry of Railways; Tractor and Mechanisation Association; Indian Ports Association; Office of Economic Adviser; GSTN; Airports Authority of India; HVS Anarock; Ministry of Tourism; Joint Plant Committee; and IHS Markit. 40 RBI Bulletin February 2025 sennot noilliM y-o-y ,tnec reP 45 25 40 37 37 37 40 36 36 38 36 38 20 35 33 34 34 34 15 30 30 25 10 5.8 20 5 4.0 15 11 13 13 11 13 11 12 12 12 13 12 13 12 13 13 0 10 -5 5 0 -10 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Chart III.25: Port Cargo Steel consumption Steel consumption growth (RHS) Cement production Cement production growth (RHS) Source: Indian Ports Association. y-o-y ,tnec reP 100 80 60 40 25.2 25.1 20 15.0 6.6 5.3 0 0.8 -20 -40 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ Total Raw fertiliser POL Containerised cargo Thermal coal Other miscellaneous cargoState of the Economy ARTICLE Inflation December, mainly on account of a higher rate of decline in kerosene prices while deflation in LPG Headline inflation, as measured by y-o-y changes prices remained steady. Electricity prices, however, in the all-India consumer price index (CPI)18, declined recorded an increase in inflation. to a five-month low of 4.3 per cent in January 2025 from 5.2 per cent in December 2024 (Chart III.27). Core inflation increased to 3.7 per cent in January The 90 bps decline in inflation was on account of a 2025 from 3.6 per cent in December. Among the sub- negative price momentum of around 100 bps (m-o-m), groups, inflation edged up in housing, household partially offset by an adverse base effect of around 10 goods and services, transport and communication, bps. The food group recorded a negative momentum and personal care and effects subgroups; it remained of around 240 bps during the month, while that in steady in clothing and footwear, and health; and fuel and core (excluding food and fuel) groups was moderated in pan, tobacco and intoxicants, recreation positive at 40 and 30 bps, respectively. and amusement, and education (Chart III.29). Food inflation decelerated to 5.7 per cent in In terms of regional distribution, rural and January from 7.7 per cent (y-o-y) in December. In urban inflation was at 4.6 per cent and 3.9 per cent, terms of sub-groups, inflation moderated in cereals, respectively, in January 2025. At the state level, eggs, vegetables, and pulses, but picked up in oils and inflation rates ranged from 2.0 to 7.4 per cent. Majority fats, fruits, sugar and confectionary, non-alcoholic of the states recorded inflation less than 6 per cent beverages, and prepared meals. Inflation remained (Chart III.30). steady in meat and fish, and milk and products while High frequency food price data for February so deflation in spices narrowed (Chart III.28). far (up to 14th) show that rice prices remained largely Fuel and light deflation was (-)1.4 per cent unchanged, while wheat prices continued to edge in January as compared with (-) 1.3 per cent in up. Edible oil prices firmed up further while pulses Chart III.27: Trends and Drivers of CPI Inflation a. CPI Inflation (y-o-y) Sources: National Statistical Office (NSO); and RBI staff estimates. 18 As per the provisional data released by the National Statistical Office (NSO) on February 12, 2025. RBI Bulletin February 2025 41 tnec reP b. Contributions Food and beverages CPI excluding food and fuel Fuel and light CPI headline (y-o-y, per cent) stniop egatnecrep ni noitubirtnoC 12 10 8 6 5.7 4 4.3 3.7 2 0 -2 -1.4 -4 -6 Food and beverages CPI excluding food and fuel Fuel and light CPI headline (y-o-y, per cent) 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 8 7 6 5 4.3 4 3 2.7 2 1 1.7 0 -0.1 -1 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJARTICLE State of the Economy Chart III.28: Annual Inflation (y-o-y) and Momentum (m-o-m) across Sub-groups Sources: NSO; and RBI staff estimates. prices recorded a broad-based moderation. Prices of Retail selling prices of petrol, diesel and LPG key vegetables including potato, onion and tomato remained unchanged in February thus far (up to 14th) continued their correction (Chart III.31). while kerosene prices increased (Table III.3). Chart III.29: Annual Inflation across Sub-groups (January 2025 versus December 2024) Sources: NSO; and RBI staff estimates. 42 RBI Bulletin February 2025State of the Economy ARTICLE Table III.3: Petroleum Products Prices Item Unit Domestic Prices Month-over- month (per cent) Dec-24 Jan-25 Feb-25^ Jan-25 Feb-25^ Petrol ₹/litre 101.02 101.02 101.02 0.0 0.0 Diesel ₹/litre 90.48 90.48 90.48 0.0 0.0 Kerosene ₹/litre 44.75 43.93 46.37 -1.8 5.6 (subsidised) LPG (non- ₹/cylinder 813.25 813.25 813.25 0.0 0.0 subsidised) Notes: 1. ^: For the period February 1-14, 2025. 2. Other than kerosene, prices represent the average Indian Oil Corporation Limited (IOCL) prices in four major metros (Delhi, Kolkata, Mumbai and Chennai). For kerosene, prices denote the average of the subsidised prices in Kolkata, Mumbai and Chennai. Sources: IOCL; Petroleum Planning and Analysis Cell (PPAC); and RBI staff estimates. sector. Selling price pressures moderated across As per the PMIs, input costs softened in January manufacturing firms but increased for services firms for the manufacturing sector but rose for the services (Chart III.32). Chart III.31: DCA Essential Commodity Prices Sources: Department of Consumer Affairs, GoI; and RBI staff estimates. RBI Bulletin February 2025 43 margolik rep ₹ a. Cereals b. Pulses margolik rep ₹ c. Vegetables d. Edible Oils (packed) margolik rep ₹ Urad dal Tur/ Arhar dal Moong dal Rice Wheat Masoor dal Gram dal Potato Onion Tomato (RHS) Groundnut oil Mustard oil Sunflower oil margolik rep ₹ margolik rep ₹ 50 45 42.3 140.3 40 121.1 34.9 112.4 35 90.2 88.6 30 25 32-beF 32-rpA 32-nuJ 32-guA 32-tcO 32-ceD 42-beF 42-rpA 42-nuJ 42-guA 42-tcO 42-ceD 52-beF 190 175 160 145 130 115 100 85 70 55 32-beF 32-rpA 32-nuJ 32-guA 32-tcO 32-ceD 42-beF 42-rpA 42-nuJ 42-guA 42-tcO 42-ceD 52-beF 200 190 180 170 160 150 140 130 120 32-beF 32-rpA 32-nuJ 32-guA 32-tcO 32-ceD 42-beF 42-rpA 42-nuJ 42-guA 42-tcO 42-ceD 52-beF 80 160 70 140 60 120 50 100 40 80 30 60 20 40 10 20 0 0 32-beF 32-rpA 32-nuJ 32-guA 32-tcO 32-ceD 42-beF 42-rpA 42-nuJ 42-guA 42-tcO 42-ceD 52-beF Chart III.30: Spatial Distribution of Inflation January 2025 (CPI-Combined, y-o-y), (per cent) <4 4-6 6-8 Note:Mapisforillustrativepurposesonly. Sources:NSO;andRBIStaffestimates. 193.8 35.2 170.3 154.9 24.1 20.7ARTICLE State of the Economy Households’ perception of current inflation IV. Financial Conditions moderated by 10 bps and stood at 8.3 per cent in the System liquidity has turned into deficit since January 2025 round of RBI’s inflation expectations mid-December 2024 due to build-up in government survey. Their inflation expectations for the next three cash balances driven by the usual quarter-end advance months and one year, however, increased by 20 bps tax outflows, monthly GST payments, capital outflows and 10 bps, respectively, over the previous round and currency leakage. To assure market participants (Chart III.33). of the availability of sufficient liquidity on a day-to- day basis, the Reserve Bank introduced daily variable Chart III.33: Households' Median rate repo (VRR) auctions effective January 16, 2025. Inflation Expectations In addition, one main 14-day VRR operation was conducted on January 24, 2025. Taking cognisance of the liquidity tightness, the Reserve Bank announced a slew of measures – open market operations, USD/ INR buy/sell swap and longer-term VRR - on January 27, 2025 to meet the durable liquidity requirements of the banking system. The open market purchase auction of government securities (G-secs) on January 30 and February 13, and the USD/INR buy/sell swap on January 31 together injected liquidity to the tune of approximately ₹1.04 lakh crore. Besides, the Reserve Bank’s purchases of G-secs through the Negotiated Dealing System – Order Matching segment (NDS-OM) Source: Inflation Expectations Survey of Households, RBI. during January injected durable liquidity of around 44 RBI Bulletin February 2025 tnec reP 11 10.2 10 9.3 9 8.3 8 7 Current 3 months ahead 1 year ahead 22-luJ 22-peS 22-voN 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ Chart III.32: PMI: Input and Output Prices a. Manufacturing Note: A level of 50 corresponds to no change in activity and a reading above 50 denotes expansion and vice versa. Source: S&P. )egnahc oN=05( xednI )egnahc oN=05( xednI b. Services 65 60 56.2 55 53.6 54.0 51.8 50 45 Input prices Output prices Input prices Prices charged 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 65 60 55 50 45 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJState of the Economy ARTICLE ₹0.39 lakh crore in the system. The Reserve Bank skewed distribution of liquidity in the banking system conducted a 56-day VRR auction for a notified amount and behavioral aspects such as select banks’ reluctance of ₹50,000 crore on February 7, 2025, followed by a to onlend in the uncollateratised call money market.19 49-day VRR auction for a notified amount of ₹75,000 The weighted average call rate (WACR) – the crore on February 14, 2025. In addition, one OMO operating target of monetary policy – moderated since purchase auction of Government of India securities mid-January with the introduction of daily VRR and for an aggregate amount of ₹40,000 crore is also the repo rate rate cut on February 7. It averaged 6.49 scheduled on February 20, 2025. per cent during January 16 to February 13, 2025 as Overall, the average daily net injection under compared to 6.69 per cent during December 16, 2024 the liquidity adjustment facility (LAF) stood at ₹1.92 to January 15, 2025 (Chart IV.2a). lakh crore during January 16 to February 13, 2025 as Across the term money market segment, interest compared to the average net injection of ₹1.6 lakh rates on 3-month certificates of deposit (CDs) and crore recorded during December 16, 2024 to January 3-month commercial paper (CP) issued by non-banking 15, 2025 (Chart IV.1). Consequent to the various financial companies (NBFCs) averaged 7.49 per cent liquidity measures taken by the Reserve Bank and the and 7.88 per cent, respectively, during January 16 – pick up in government spending, liquidity tightness somewhat moderated in early February. Banks’ February 13, 2025, up from 7.35 per cent and 7.68 per placement of funds under the standing deposit facility cent, respectively, during December 15, 2024 – January (SDF) averaged ₹0.84 lakh crore during January 16 15, 2025. The average yield on 91-day T-bill remained to February 13, 2025, higher relative to the previous marginally moderated to 6.51 per cent during January month. The co-existence of deficit liquidity conditions 16 – February 13, 2025 from 6.54 per cent during and funds deployed under the SDF is indicative of December 15, 2024 – January 15, 2025 (Chart IV.2b). Chart IV.1: Liquidity Operations Daily SDF Variable rate reverse repo Net LAF MSF Variable rate repo Total absorption Source: RBI. 19 Monetary Policy Statement 2024-25, Governor Statement, February 7, 2025. RBI Bulletin February 2025 45 erorc hkal ₹ 4.0 3.0 2.0 1.0 0.0 -1.0 -2.0 -3.0 -4.0 42-beF-51 42-beF-92 42-raM-41 42-raM-82 42-rpA-11 42-rpA-52 42-yaM-90 42-yaM-32 42-nuJ-60 42-nuJ-02 42-luJ-40 42-luJ-81 42-guA-10 0.5 -2.3 -2.9 42-guA-51 42-guA-92 42-peS-21 42-peS-62 42-tcO-01 42-tcO-42 42-voN-70 42-voN-12 42-ceD-50 42-ceD-91 52-naJ-20 52-naJ-61 52-naJ-03 52-beF-31ARTICLE State of the Economy Chart IV.2: Policy Corridor and Money Market Rates Sources: RBI; CCIL; and Bloomberg. The spread of 3-month CPs (NBFC) rate over In the primary market, issuances of CDs grew by the 91-day T-bill rate was lower during January 18 - 43.9 per cent (y-o-y) to ₹9.57 lakh crore during April February 14, 2025 as compared to the corresponding 2024 to February 2025 (up to February 7) from ₹6.66 period of the previous year. On the other hand, the lakh crore in the corresponding period of the previous spread of the 3-month CD rate over the 91-day T-bill year (Chart IV.4). Similarly, CP issuances stood at rate edged up (Chart IV.2c). ₹12.44 lakh crore during 2024–25 (up to January), up from ₹10.84 lakh crore during the corresponding The weighted average discount rate (WADR) of period of the previous year. CPs during January 18 - February 14, 2025 remained lower than the levels recorded a year ago (Chart IV.3). The yield on the 10-year G-sec benchmark Similar trend was observed for the weighted average moderated to 6.75 per cent on February 13, 2025 from effective interest rate (WAEIR) of CDs. WAEIR was 6.85 per cent on January 15, 2025. This moderation lower at 7.58 per cent during January 18 - February was in line with the softening US treasury yields, a 14, 2025 as compared with 7.86 per cent a year ago decline in crude oil prices, and RBI’s liquidity injection as the gap between credit and deposit growth operations (Chart IV.5a). The yield curve shifted narrowed. downwards across the tenor. Between January 16 and 46 RBI Bulletin February 2025 erorc hkal ₹ Repo rate WACR MSF SDF tnec reP tnec reP a. Policy Corridor and Call Rate b. Money Market Rates Tri-party repo Market repo 3-month T-bill 3-month CD 3-month CP (NBFC) c. Spread of 3-months CP and CD Rate over 91-day T-bill Rate stniop sisaB 7.5 7.3 7.1 7.80 6.9 7.43 6.7 6.50 6.5 6.34 6.3 6.44 6.1 6.25 6.35 5.9 6.00 6.31 5.7 5.5 136 103 Net LAF (RHS) Spread of CD 3M Rate over 91-day T-bill Rate Spread of CP NBFC 3M Rate over 91-day T-bill Rate Spread of CP Non-NBFC 3M Rate over 91-day T-bill Rate 42-rpA-52 42-yaM-9 42-yaM-32 42-nuJ-6 42-nuJ-02 42-luJ-4 42-luJ-81 42-guA-1 42-guA-51 42-guA-92 42-peS-21 42-peS-62 42-tcO-01 42-tcO-42 42-voN-7 42-voN-12 42-ceD-5 42-ceD-91 52-naJ-2 52-naJ-61 52-naJ-03 52-beF-31 8.7 8.4 8.1 7.8 7.5 7.2 6.9 6.6 6.3 6.0 32-voN-12 32-ceD-12 42-naJ-02 42-beF-91 42-raM-02 42-rpA-91 42-yaM-91 42-nuJ-81 42-luJ-81 42-guA-71 42-peS-61 42-tcO-61 42-voN-51 42-ceD-51 52-naJ-41 52-beF-31 180 4 160 3 140 2 120 1 100 0 80 -1 60 40 -2 20 -3 0 -4 22-peS 22-tcO 22-voN 22-ceD 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ 52-beF 99 -2.3State of the Economy ARTICLE Chart IV.3: WADR and WAEIR Note: *: up to February 14, 2025. Sources: RBI; and CCIL- FTRAC. February 13, 2025, the average term spread (10-year bond market further eased and remained low relative G-sec yield minus 91-day T-bills yield) narrowed to 24 to US treasuries amidst positive sentiments on bps from 27 bps in the previous month (Chart IV.5b). fiscal consolidation following the announcement of the Union Budget and from inclusion of Indian The spread of the 10-year Indian G-sec yield over government bonds in global indices (Chart IV.6). the 10-year US bond fell to 217 bps as on February 14, 2025 from 314 bps in mid-September and 286 Corporate bonds issuances at ₹7.25 lakh crore were bps a year ago. The volatility of yields in the Indian higher during 2024-25 (up to December) than ₹6.09 RBI Bulletin February 2025 47 erorc dnasuoht ₹ tnec reP 800 9 7.68 8 600 7.53 7 400 6 5 200 80 4 72 0 3 2 -200 -133 1 -400 0 Net LAF CP Issuance (Monthly) CD Issuance (Monthly) WADR (RHS) WAEIR (RHS) 12-beF 12-raM 12-rpA 12-yaM 12-nuJ 12-luJ 12-guA 12-peS 12-tcO 12-voN 12-ceD 22-naJ 22-beF 22-raM 22-rpA 22-yaM 22-nuJ 22-luJ 22-guA 22-peS 22-tcO 22-voN 22-ceD 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ *52-beF Chart IV.4: Certificates of Deposit (CDs) and Commercial Paper (CP) - Fortnightly Issuances Source: RBI. erorc dnasuoht ₹ erorc dnasuoht ₹ 100 120 90 80 100 70 60 80 69 50 40 30 60 30 20 40 10 0 20 Certificates of deposit Commercial paper (RHS) 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJARTICLE State of the Economy Chart IV.5: Developments in the G-sec Market a. Movement in 10-year G-sec Yield b. G-sec Yield Curve Sources: Bloomberg; CCIL; and RBI staff estimates. lakh crore a year ago. Corporate bond yields generally recorded a growth of 6.5 per cent (y-o-y) as on softened across ratings and tenor spectrums while February 7, 2025 (5.9 per cent a year ago) [Chart IV.7]. the corresponding risk premia showed mixed trend, Growth in currency in circulation (CiC), the largest during January 16 – Febraury 13, 2025 (Table IV.1). component of RM, stood at 5.3 per cent (y-o-y) as Reserve money (RM), excluding the first-round on February 7, 2025 as compared with 3.7 per cent impact of change in the cash reserve ratio (CRR), a year ago. 48 RBI Bulletin February 2025 tnec reP tnec reP India US (RHS) tnec reP stniop sisaB 7.3 5.5 7.2 5.0 4.53 7.1 4.5 7.0 -8 4.0 6.9 7.03 3.5 6.8 6.75 6.95 6.7 3.0 6.6 2.5 Tenor (years) 14-01-2025 13-02-2025 Change (Feb 13, 2025 over Jan 14, 2025) (RHS) 42-yaM-91 42-nuJ-60 42-nuJ-42 42-luJ-21 42-luJ-03 42-guA-71 42-peS-40 42-peS-22 42-tcO-01 42-tcO-82 42-voN-51 42-ceD-30 42-ceD-12 52-naJ-80 52-naJ-62 52-beF-31 0 7.9 -2 7.7 -4 7.5 -6 7.3 -8 -10 7.1 -12 6.9 -14 6.7 -16 6.5 -18 1 3 5 7 9 11 31 51 71 91 Chart IV.6 : Volatility and Spread-Bond Market Note: *: 12-months rolling standard deviation. Sources: Bloomberg; and RBI staff calculations. *noitaived dradnatS stniop sisaB 1 400 350 0.8 300 0.6 250 217 0.4 200 0.2 0.27 150 0.15 0 100 Volatility-US 10 year bond Volatility- India 10 year bond Spread of 10 year Indian G-sec over US 10 year bond (RHS) 32-luJ-10 32-guA-30 32-peS-50 32-tcO-80 32-voN-01 32-ceD-31 42-naJ-51 42-beF-71 42-raM-12 42-rpA-32 42-yaM-62 42-nuJ-82 42-luJ-13 42-peS-20 42-tcO-50 42-voN-70 42-ceD-01 52-naJ-21 52-beF-41State of the Economy ARTICLE Table IV.1: Financial Markets - Rates and Spread Interest Rates (per cent) Spread (basis points) (Over Corresponding Risk-free Rate) Instrument Dec 16, 2024 – Jan 16, 2025 – Variation Dec 16, 2024 – Jan 16, 2025 – Variation Jan 15, 2025 Feb 13, 2025 (basis points) Jan 15, 2025 Feb 10, 2025 1 2 3 (4 = 3-2) 5 6 (7 = 6-5) Corporate Bonds (i) AAA (1-year) 7.88 7.88 0 112 117 5 (ii) AAA (3-year) 7.74 7.65 -9 92 91 -1 (iii) AAA (5-year) 7.62 7.50 -12 76 74 -1 (iv) AA (3-year) 8.51 8.44 -7 169 170 1 (v) BBB- (3-year) 12.18 12.11 -7 535 538 3 Note: Yields and spreads are computed as averages for the respective periods. Sources: FIMMDA. Money supply (M ) rose by 9.6 per cent (y-o-y) as on SCBs’ deposit growth (excluding the impact of 3 January 24, 2025 (11.0 per cent a year ago).20 Aggregate the merger) was at 10.6 per cent as on January 24, deposits with banks, accounting for around 86 per 2025, up from 10.2 per cent as at end-December 2024, cent of M , increased by 10.2 per cent (12.0 per cent a supported by positive momentum and favourable 3 year ago). Scheduled commercial banks’ (SCBs’) credit base effect witnessed in the first fortnight of January growth was 12.5 per cent as on January 24, 2025 (16.1 2025 (Chart IV.9). per cent a year ago) [Chart IV.8]. Chart IV.7: Reserve Money and Currency in Circulation Reserve money (CRR adjusted) Currency in circulation Note: Latest data for reserve money pertain to February 7, 2025. Source: RBI. 20 Excluding the impact of the merger of a non-bank with a bank (with effect from July 1, 2023). RBI Bulletin February 2025 49 y-o-y ,tnec reP 10 9 8 7 6.48 6 5.34 5 4 3 2 32-beF-01 32-raM-01 32-rpA-70 32-yaM-50 32-nuJ-20 32-nuJ-03 32-luJ-82 32-guA-52 32-peS-22 32-tcO-02 32-voN-71 32-ceD-51 42-naJ-21 42-beF-90 42-raM-80 42-rpA-50 42-yaM-30 42-yaM-13 42-nuJ-82 42-luJ-62 42-guA-32 42-peS-02 42-tcO-81 42-voN-51 42-ceD-31 52-naJ-01 52-beF-70ARTICLE State of the Economy 18 3 17 2 16 15 1 14 0.4 13 0 12.5 12 -0.6 -1 11 10 -2 9 9.6 8 -3 SCBs’ incremental credit-deposit ratio increased With faster adjustments in rates, the external to 91.6 per cent as on January 24, 2025 from 80.7 per benchmark-based lending rate (EBLR)21 system has cent as at end-October 2024 (Chart IV.10). quickened the pace of monetary policy transmission 21 The Reserve Bank mandated that all scheduled commercial banks (excluding regional rural banks and small finance banks) should link all new floating rate personal or retail loans and floating rate loans to micro and small enterprises (MSEs) to an external benchmark, viz., the policy repo rate or 3-month T-bill rate or 6-month T-bill rate or any other benchmark market interest rate published by Financial Benchmarks India Private Ltd. (FBIL) effective October 1, 2019. The directive was extended to medium enterprises effective April 1, 2020. 50 RBI Bulletin February 2025 32-naJ-72 32-beF-42 32-raM-42 32-rpA-12 32-yaM-91 32-nuJ-61 32-luJ-41 32-guA-11 32-peS-80 32-tcO-60 32-voN-30 32-ceD-10 32-ceD-92 42-naJ-62 42-beF-32 42-raM-22 42-rpA-91 42-yaM-71 42-nuJ-41 42-luJ-21 42-guA-90 42-peS-60 42-tcO-40 42-voN-10 42-voN-92 42-ceD-72 52-naJ-42 Chart IV.8: M Growth and Credit Growth of SCBs - Base and Momentum Effect 3 Source: RBI. y-o-y ,tnec reP stniop egatnecreP SCBs' credit growth M growth 3 SCBs' credit momentum effect (RHS) SCBs' credit base effect (RHS) SCBs' deposit growth SCBs' deposit momentum effect (RHS) SCBs' deposit base effect (RHS) Source: RBI. y-o-y ,tnec reP stniop egatnecreP Chart IV.9: SCBs' Deposit Growth - Momentum and Base Effect 14 4 13 3 12 2 10.6 11 1 10 0 -0.1 -0.4 9 -1 8 -2 7 -3 6 -4 22-rpA-80 32-rpA-12 32-yaM-91 32-nuJ-61 32-luJ-41 32-guA-11 32-peS-80 32-tcO-60 32-voN-30 32-ceD-10 32-ceD-92 42-naJ-62 42-beF-32 42-raM-22 42-rpA-91 42-yaM-71 42-nuJ-41 42-luJ-21 42-guA-90 42-peS-60 42-tcO-40 42-voN-10 42-voN-92 42-ceD-72 52-naJ-42State of the Economy ARTICLE Chart IV.10: Incremental Credit-Deposit Ratio Source: RBI. (RBI, 2023)22. In the bi-monthly policy of February and outstanding rupee loans of SCBs increased 2025, the policy repo rate was reduced by 25 bps by 174 bps and 115 bps, respectively, during May to 6.25 per cent. Accordingly, banks have started 2022 to December 2024 (Table IV.2). On the deposit adjusting their repo-linked lending rates downward. side, the weighted average domestic term deposit rates (WADTDRs) on fresh and outstanding deposit The marginal cost of funds-based lending rate (MCLR) increased by 254 bps and 197 bps, respectively, during that have a longer reset period and are referenced to the same period. the deposit rates, are expected to get adjusted with a lag. In response to the 250 bps policy rate hike during Transmission across bank groups indicates that May 2022 to January 2025, the 1 year-median MCLR the increase in the WALR on fresh rupee loans was of SCBs had increased by 178 bps. Consequently, the higher for public sector banks (PSBs) vis-à-vis private weighted average lending rates (WALRs) on fresh banks (PVBs). In the case of outstanding loans, 22 Kashyap, Y., et al., (2023). Monetary Policy Transmission in India: Recent Dynamics, Reserve Bank of India Bulletin, November- 2023, https://www.rbi. org.in/Scripts/BS_ViewBulletin.aspx?Id=22192 RBI Bulletin February 2025 51 )erorc hkal ₹( eulaV )tnec rep( oitaR 26 120 24 110 22 100 20 90 91.6 18 80 16 70 14 60 Incremental credit Incremental deposit Incremental credit-deposit ratio (RHS) 32-naJ-72 32-beF-42 32-raM-42 32-rpA-12 32-yaM-91 32-nuJ-61 32-luJ-41 32-guA-11 32-peS-8 32-tcO-6 32-voN-3 32-ceD-1 32-ceD-92 42-naJ-62 42-beF-32 42-raM-22 42-rpA-91 42-yaM-71 42-nuJ-41 42-luJ-21 42-guA-9 42-peS-6 42-tcO-4 42-voN-1 42-voN-92 42-ceD-72 52-naJ-42 21.2 19.4 Table IV.2: Transmission to Banks’ Deposit and Lending Rates (Variation in basis points) Term Deposit Rates Lending Rates Period Repo WADTDR- WADTDR- EBLR 1-Yr. MCLR WALR - Fresh WALR- Rate Fresh Deposits Outstanding (Median) Rupee Loans Outstanding Deposits Rupee Loans Easing Phase -250 -259 -188 -250 -155 -232 -150 Feb 2019 to Mar 2022 Tightening Period May 2022 to +250 254 197 250 178 174 115 Dec* 2024 Notes: Data on EBLR pertain to 32 domestic banks. *: Data on EBLR and MCLR pertain to January 2025. WALR: Weighted Average Lending Rate; WADTDR: Weighted Average Domestic Term Deposit Rate; MCLR: Marginal Cost of Funds-based Lending Rate; EBLR: External Benchmark-based Lending Rate. Source: RBI.ARTICLE State of the Economy however, the transmission in PSBs was (Chart IV.11) cent (y-o-y) during Q3:2024-25, up from 5.4 per lower. In deposits, transmission to WADTDRs of both cent in the previous quarter. Sales of listed private fresh and outstanding deposits was higher for PSBs manufacturing companies increased by 7.6 per cent as compared to PVBs during May 2022 and December (y-o-y) during Q3:2024-25 as compared to 3.5 per cent 2024 (Chart IV.12). during the previous quarter (Chart IV.13). Automobiles, Based on the results of listed non-government chemicals, food and electrical machinery industries, non-financial companies23, sales grew by 7.9 per which together accounted for about 41 per cent share Chart IV.12: Transmission across Bank groups; Deposit Rates (May 2022 to December 2024) Source: RBI. 23 Based on 2263 listed non-government non-financial (NGNF) companies. 52 RBI Bulletin February 2025 stniop sisaB Chart IV.11: Transmission across Bank groups; Lending Rates (May 2022 to December 2024) 350 300 284 280 274 250 214 201 200 177 150 100 50 0 WADTDR WADTDR (Fresh Deposits) (Outstanding Deposits) PSBs PVBs FBs stniop sisaB 350 321 300 250 200 177 175 185 175 163 139 150 130 98 100 50 0 WALR WALR 1- Year (Fresh Rupee Loans) (Outstanding Rupee Loans) Median MCLR PSBs PVBs FBs Source: RBI.State of the Economy ARTICLE in total sales of the manufacturing sector, mainly Despite rise in input costs and other expenses, contributed to manufacturing sales growth during Q3. the operating profits of manufacturing companies rose Among the major industries, sales of petroleum, iron on a y-o-y as well as sequential basis during Q3:2024- and steel and cement industries, however, contracted 25. Consequently, operating profit margin improved during Q3. Performance of non-IT services sector marginally during Q3 in comparison to the previous remained upbeat as indicated by the double quarter. Within the services sector, the operating digit sales growth. Sales growth of IT companies profit margins improved for both IT as well as non-IT also inched up further but remained low during service sector companies during Q3:2024-25, in line Q3:2024-25. with their sustained sales growth (Chart IV.14). RBI Bulletin February 2025 53 tnec reP Chart IV.13: Nominal Sales Growth (Y-o-Y) 75 50 25 11.6 11.7 7.6 0 6.6 6.4 3.5 -25 -50 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 Manufacturing IT Services (Non-IT) Notes: (i) Dotted lines indicate growth of common companies during Q2 and Q3 of 2024-25. (ii) Based on results of 2263 listed priv ate non-financial companies. Sources: Capitaline database; and RBI staff calculations. Chart IV.14: Operating Profit Margins tnec reP 35 30 25.3 25 23.4 20 22.9 22.6 15 10 14.1 14.2 5 0 -5 -10 -15 -20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2018-19 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 Manufacturing IT Non-IT Notes: (i) Dotted lines indicate growth of common companies during Q2 and Q3 of 2024-25. (ii) Based on results of 2263 listed priv ate non-financial companies. Sources: Capitaline database; and RBI staff calculations.ARTICLE State of the Economy Chart IV.15: Private Corporate Investment Intentions Total Cost of Projects Sanctioned by Banks/FIs ECBs/IPOs (Only Capex) Source: RBI; Data on project finance gathered from banks/FIs; and RBI staff calculations. Project finance data collected from select banks growth amid a moderation in salary growth. Further, and financial institutes (FIs) indicate that during decline in provisioning costs resulted in net profits Q3:2024-25, total cost of projects sanctioned by banks/ growing at a faster rate than operating profits. FIs at around ₹97,996 crore were marginally higher During January - February 2025 so far, the Indian than ₹96,226 in the previous quarter. About 70 per equity markets registered moderate losses, with the cent of intended investment was concentrated in BSE Sensex decreasing by 1 per cent (since January 15) ‘power’, ‘metals’ and ‘road and bridges’ industries. to close at 75,939 on February 14, 2025 (Chart IV.17). Funds raised through ECBs and IPOs for capex purpose stood at ₹35,893 crore during Q3:2024-25 as compared to ₹31,027 crore in the previous quarter (Chart IV.15). During Q3:2024-25, the Indian listed banking and financial sector companies24 experienced a moderation in their top-line growth (Chart IV.16). Revenues, which primarily include interest income in the case of banks, exhibited double-digit growth for banking and financial sector companies, notwithstanding some moderation over the previous quarter. Growth of other income, which includes income from fees, commissions, profit and loss from investments, etc. slowed down in comparison to the previous quarter. Expenditure growth was slower than the revenue 24 Based on a sample of 328 companies constituting around 81 per cent of the total market capitalisation of listed banking and financial sector companies. 54 RBI Bulletin February 2025 erorc dnasuoht ₹ 1,40 127 1,20 119 1,00 103 97 101 96 98 85 80 71 60 57 54 47 46 48 39 43 42 43 40 27 34 31 23 23 34 30 37 33 24 37 31 36 20 15 11 6 19 9 20 11 12 12 20 12 17 15 20 4 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 Chart IV.16: Performance of Listed Financial Companies 30 27.6 25.5 25 24.2 22.0 20.3 20.4 20 18.5 19.5 17.4 15.5 15 14.3 13.9 13.9 14.4 12.0 11.7 12.2 10.9 9.8 10 8.4 5 0 Revenues Other Expenditure Operating Net income profits profits Mar 2024 Jun 2024 Sep 2024 Dec 2024 Sources: CMIE Prowess; and RBI staff estimates. tnec rep ni htworg Y-o-YState of the Economy ARTICLE Chart IV.17: BSE Sensex and Institutional Flows Note: FPI and MF flows are represented on 15-days rolling sum basis. Source: Bloomberg. The broader market indices underperformed the by the Reserve Bank of India to boost the liquidity benchmark, with the BSE Midcap and BSE Smallcap in the banking system and favourable cues from indices declining by 8.3 per cent and 11.9 per cent, global markets. The markets remained rangebound respectively, during the same period. In the second thereafter, with positive cues from budget tax proposal half of January, markets declined initially as investors on consumption before declining amid sustained FPI assessed corporate earnings releases for Q3:2024- sell-offs. 25 and uncertainties regarding the US outlook. The Gross inward foreign direct investment (FDI) benchmark registered a sharp turnaround in the last rose by 20.6 per cent (y-o-y) to US$ 62.5 billion during week of January amid the announcement of measures April-December 2024 (Chart IV.18a). Among sectors, RBI Bulletin February 2025 55 xednI erorc dnasuoht ₹ 75939 Sensex FPI flows (RHS) Mutual fund flows (RHS) Chart IV.18: Foreign Direct Investment Flows a. India b. Global FDI Net outward FDI Repatriation/Disinvestment Gross FDI Net FDI Sources: RBI; and UNCTAD. noillib $SU noillib $SU tnec reP 80 71.4 71.3 60 62.5 51.8 40 28.0 20 10.1 7.8 1.2 0 -20 -29.3 -33.1 -44.0 -44.5 -40 -14.0 -10.9 -60 -16.7 -17.3 -80 32-2202 42-3202 42-3202 )ceD-rpA( 52-4202 )ceD-rpA( 2000 80 1500 1378 60 1000 40 500 20 0 0 -500 -20 -1000 -40 -1500 -60 9102 0202 1202 2202 3202 4202 10-year average 11 Global FDI Inflows Growth (y-o-y) [RHS]ARTICLE State of the Economy manufacturing, financial services, electricity and its Bloomberg Emerging Market (EM) Local Currency other energy, and communication services received index, inducing more than US$ 1.0 billion inflow in more than 60 per cent of the gross equity inflows. the debt segment. During 2024-25 (April-January), debt inflows in India remained strong as compared to Singapore, Mauritius, the UAE, the Netherlands, and peer economies, cushioning the effect of equity sell- the US, were the top investment sources, accounting offs (Chart IV.19b). In February 2025 (up to February for more than 75 per cent of the flows during the 13), the outpour continued with net FPI outflows period. Net inward FDI (i.e., gross inward FDI adjusted amounting to US$ 2.7 billion. for repatriation) moderated slightly to US$ 18.5 billion during April-December 2024 from US$ 18.8 billion Net inflows under non-resident deposits (NRD) rose to US$ 13.3 billion during April-December 2024 a year ago, reflecting a rise in repatriation. In 2024, from US$ 9.3 billion a year ago, with inflows in all global FDI rose by 11 per cent on a y-o-y basis but three accounts, namely, Non-Resident (External) stayed below its 10-year average for the third straight Rupee Accounts [NR(E)RA], Non-Resident Ordinary year (Chart IV.18b). (NRO) and Foreign Currency Non-Resident (Banks) FPI flows turned negative in January 2025, [FCNR(B)] accounts. During April-December 2024, net reflecting heightened global uncertainties. Net FPI external commercial borrowing (ECB) inflows stood at outflows worth US$ 6.7 billion were recorded with US$ 15.6 billion during April-December 2024, nearly equity outflows of US$ 8.4 billion amidst rising risk- three times the inflows recorded in the same period off sentiments among investors (Chart IV.19a). The of the previous year (Chart IV.20). debt segment, however, showed signs of revival, Of the total ECBs registered during April-December with net inflows of US$ 1.7 billion, the highest since 2024, more than 40 per cent were intended to be used October 2024. On January 31, 2025, the Bloomberg for capital expenditure purposes. Further, the period Index Services included Indian government bonds in also witnessed a substantial increase in refinancing of Chart IV.19: Net Portfolio Investments a. India b. Peer Economies (April 2024 - January 2025)^ Notes: 1. Debt also includes investments under the hybrid instruments. 2. *: Data up to February 13. 3. ^: Data for India and equity flows to other countries are up to January 2025 while debt flows for other countries is up to December 2024. Sources: National Securities Depository Limited (NSDL); and Institute of International Finance. 56 RBI Bulletin February 2025 noillib $SU noillib $SU 12 8 4 0 -2.7 -4 -8 -6.7 -12 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 42-ceD 52-naJ *52-beF 24 20.6 20 16 13.3 12 8 5.3 4.2 3.8 3.7 4 1.9 1.8 0 -4 -2.8 -8 -12 Equity Debt Total Equity Debt Total yekruT lizarB aeroK aisenodnI anihC senippilihP aidnI acirfA htuoS dnaliahTState of the Economy ARTICLE Chart IV.20: External Commercial Borrowings - Registrations and Flows Source: Form ECB, RBI. ECB/rupee loans in comparison with the previous year This considerably aids in offsetting the interest and (Chart IV.21). exchange rate sensitivity of such exposures. During April-December 2024, the share of Since March 2024, global benchmark interest effectively hedged ECBs, viz., explicitly hedged loans, rates such as the secured overnight financing rate rupee denominated loans and loans from foreign (SOFR) have declined up to 85 bps, reducing the parents increased to 78.1 per cent from 61.6 per cent overall cost of ECB by 25 bps during April - December over the same period of the previous year (Chart IV.22). 2024 (Chart IV.23). RBI Bulletin February 2025 57 noillib $SU 45 43.3 40 36.1 36.6 35 30 26.1 25 20 17.9 15.6 15 13.4 10 6.5 5.3 5 0 -5 -6.8 -10 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 -15 -20.7 -21 -20 2022-23 2023-24 2024-25 Apr-Dec 23 Apr-Dec 24 -25 Registrations Gross Disbursements Principal Repayments Net inflows Chart IV.21: End-use of the Registered ECBs Chart IV.22: ECB Agreements - Hedging Position Apr-Dec 24 3.3 6.4 9.0 9.3 15.4 Apr-Dec 23 10.3 10.4 4.8 4.8 5.9 0 5 10 15 20 25 30 35 40 45 US $ billion Import/ local sourcing of capital goods On-lending/sub-lending (Capex) Others (including working capital and general corporate purpose) Modernisation/ new project/infrastructure development Refinancing of ECB/rupee loans Source: Form ECB, RBI. Source: Form ECB, RBI. noillib $ SU 50 45 40 9 35 2 30 9 2 25 20 18 29 15 10 5 7 2 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Loan from Foreign parent(Excluding INR Loans) Hedged Loans Rupee denominated Other ECBs - (including naturally hedged loans) 3202 ceD-rpA 4202 ceD-rpA 2022-23 2023-24 2024-25ARTICLE State of the Economy Chart IV.23: Overall Cost of ECBs Secured overnight financing rate (SOFR) for US dollar Weighted average interest margin Sources: Form ECB; and RBI staff estimates. A rising US dollar and FPI outflows from EMEs of heightened global market turbulence, the INR amidst growing global uncertainties exerted significant exhibited relatively low volatility. pressure on EME currencies during January 2025. In terms of the 40-currency real effective exchange The Indian rupee (INR) depreciated by 1.5 per cent (m-o-m) in January, in line with movements in most rate (REER), the INR depreciated by 2.2 per cent major currencies (Chart IV.24). In an environment (m-o-m) in January 2025, due to depreciation of the 58 RBI Bulletin February 2025 )tnec rep ni( nigram dna etar tseretnI 8 6 4 2 0 tnec reP 22-voN 22-ceD 32-naJ 32-beF 32-raM 32-rpA 32-yaM 32-nuJ 32-luJ 32-guA 32-peS 32-tcO 32-voN 32-ceD 42-naJ 42-beF 42-raM 42-rpA 42-yaM 42-nuJ 42-luJ 42-guA 42-peS 42-tcO 42-voN 54.1 94.4 42-ceD 85.1 22.5 32 ceD-rpA 74.1 70.5 42 ceD-rpA tnec reP Chart IV.24: Movements of the Indian Rupee and Major Currencies against the US Dollar (January 2025 over December 2024) 3 2 1.4 1.6 1.3 0 0 -0.02 -0.1 -0.2 -0.2 -0.8 -0.8 -1.0 -1.2 -1.5 -1.5 -1.5 -3 -2.1 -2.2 -2.5 -2 -6 -4 Note: US dollar (DXY) measures the movements of the US dollar against a basket of major currencies (Euro, Japanese yen, British pound, Canadian dollar, Swedish krona, Swiss franc). Sources: FBIL; Thomson Reuters; and RBI staff estimates. )YXD( ralloD SU ycnerruC EME xednI laer nailizarB elbur naissuR osep enippilihP tiggnir naisyalaM nauy esenihC thab iahT rallod esenawiaT oruE haipur naisenodnI osep nacixeM eepur naidnI ney esenapaJ osep enitnegrA dnuop KU dnarnacirfA htuoS Percentage change (+ appreciation/ - depreciation) Volatility (RHS)State of the Economy ARTICLE Chart IV.25: Movements in the 40-Currency Real Effective Exchange Rate a. Monthly Changes b. Decomposition of Monthly Changes Change in REER (RHS) REER Source: RBI. INR in nominal effective terms and negative relative sustainable levels based on various reserve adequacy price differentials (Chart IV.25). metrics (Chart IV.26b). As on February 7, 2025, India’s foreign exchange Payment Systems reserves stood at US$ 638.3 billion, providing a cover The Reserve Bank of India - Digital Payment for 10.8 months of imports and 89.7 per cent of external Index reached 465.3 in September 2024, reflecting the debt outstanding at end-September 2024 (Chart growing penetration of digitalisation in the country.25 IV.26a). The foreign exchange reserves remained at In January 2025, digital transactions sustained 25 RBI Press Release, January 29, 2025. “RBI – Digital Payments Index for September 2024”. RBI Bulletin February 2025 59 )001=61-5102( xednI tnec reP Relative price effect Nominal exchange rate effect Change in REER tnec reP 110 4 108 106 2 104 104.8 102 100 0 98 96 -2 94 -2.2 92 90 -4 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ 4 2 0 -0.9 -1.2 -2 -2.2 -4 32-naJ 32-raM 32-yaM 32-luJ 32-peS 32-voN 42-naJ 42-raM 42-yaM 42-luJ 42-peS 42-voN 52-naJ Chart IV.26: Foreign Exchange Reserves a. India b. Reserve Adequacy Metrics Foreign exchange reserves Import cover (RHS) Notes: 1. *: Data for February 7. 2. The import cover data for December 2024, January and February 2025 is based on annualised merchandise imports for the quarter ending September 2024 as per the balance of payments statistics. 3. OM: Original Maturity; RM: Residual Maturity. The reserve adequacy metrics have been calculated using the latest available reserves data and annualised merchandise imports and external debt for September 2024. Sources: RBI; and RBI staff estimates. noillib $SU shtnoM tnec reP 750 14 638.3 90.2 89.7 12 650 10 47.3 8 550 20.9 6 4 450 2 350 0 32-raM 32-nuJ 32-peS 32-ceD 42-raM 42-nuJ 42 peS 42 ceD 52 naJ *52 beF 100 90 80 70 60 50 40 30 20 10 0 ot sevreseR oitar tropmi lanretxe ot sevreseR oitar tbed )MO( mret trohS oitar sevreser ot tbed )MR( mret trohS oitar sevreser ot tbedARTICLE State of the Economy Table IV.3: Growth in Select Payment Systems (y-o-y in per cent) Payment Modes Transaction Volume Transaction Value Dec-23 Dec-24 Jan-24 Jan-25 Dec-23 Dec-24 Jan-24 Jan-25 RTGS 7.1 13.8 13.1 16.1 15.7 20.6 17.1 19.1 NEFT 37.5 24.5 43.4 24.5 13.0 13.2 19.8 14.3 UPI 53.5 39.2 51.8 39.3 42.2 27.5 41.7 27.5 IMPS 2.7 -11.6 7.2 -12.7 17.2 5.5 18.6 7.1 NACH 10.9 28.2 22.8 17.2 4.6 27.6 21.5 22.5 NETC 13.0 9.8 10.2 14.8 18.6 13.3 15.5 19.0 BBPS 25.7 95.4 24.6 97.4 77.4 260.0 75.4 276.4 Note: RTGS: Real Time Gross Settlement, NEFT: National Electronic Funds Transfer, UPI: Unified Payments Interface, IMPS: Immediate Payment Service, NACH: National Automated Clearing House, NETC: National Electronic Toll Collection, BBPS: Bharat Bill Payment System. Source: RBI. broad-based growth momentum across payment a year ago (Chart IV.27a). The number of technical modes, albeit with some moderation in growth in the declines26 per 10,000 UPI transactions reduced across most bank categories in January 2025 compared to retail payment segments (Table IV.3). January 202427, reflecting enhanced efficiency of There was an increase in the share of PSBs in banks’ systems despite higher transaction volumes. volume of transactions (from remitter bank side) during The performance, however, remained uneven across January 2025 as compared with the levels recorded bank groups (Chart IV.27b). Chart IV.27: Trends in UPI Transactions - Bank Group-wise a. Share in Volume of Transactions - Remitter Banks b. Technical Declines Per 10,000 Transactions - Remitter Banks Jan-24 Jan-25 Jan-24 Jan-25 Notes: Public: Public Sector Banks; Private Private Sector Banks; SFB: Small Finance Banks; RRB: Regional Rural Banks; PAYMENT: Payment Banks. Figures are based on volume of transactions reported for Top 50 Members by National Payments Corporation of India (NPCI). Sources: NPCI; and RBI staff estimates. 26 Transaction decline due to technical reasons, such as unavailability of systems and network issues on bank or NPCI side. 27 For public sector banks as remitter banks, TD rate marginally went up from 0.55 to 0.56. For Payment banks as beneficiary banks, TD rate went up from 0.12 to 0.81. 60 RBI Bulletin February 2025 tnec reP 9 70 8.0 60 8 60 58 7 50 6 40 5 30 30 4.0 4 30 3 20 1.6 2 1.5 9 10 7 1 0.9 0.6 0.60.6 0.6 1 1 1 1 0.1 0 0 stnemyaP etavirP cilbuP BRR BFS stnemyaP etavirP cilbuP BRR BFSState of the Economy ARTICLE Card tokenisation and its use is on the rise, are concerns that these policies could stoke inflation, with 98 per cent of e-commerce transactions being engender tighter financial conditions, and heighten processed without using actual card data.28 In its market turbulence. A strong dollar, driven by U.S. Statement on Developmental and Regulatory Policies economic resilience and trade policy pivots, could of February 7, 2025, the Reserve Bank proposed to exacerbate capital outflows from emerging economies, enable Additional Factor of Authentication (AFA) for push risk premiums higher, and intensify external international card not present (online) transactions vulnerabilities. The “last mile” of disinflation may become more challenging in such an environment, to provide an additional layer of security for online potentially requiring central banks to recalibrate international transactions using cards issued in policies. India.29 The Reserve Bank is also introducing ‘bank. in’ – an exclusive internet domain for Indian banks to In India, economic activity momentum is poised reduce cyber security threats and malicious activities to be sustained, strong rural demand is expected to like phishing, while streamlining secure financial receive a further fillip from the robust performance services. To further prevent online and other frauds, of the agriculture sector. Urban demand is also poised the Reserve Bank has issued regulatory prescriptions for a recovery, tracking decline in inflation as well as a and institutional safeguards for its Regulated Entities, boost to disposable incomes from the sizeable income including the use of a mobile number revocation list, tax relief announced in the Union Budget 2025-26. development of standard operating procedures and The Budget measures to fuel four engines of growth dedicated numbering series for transactional and – agriculture, MSMEs, investment and exports – are expected to boost medium-term growth prospects of promotional calls.30 The Reserve Bank has also decided the Indian economy. The Union Budget prudently to amend the instructions under the Framework balances fiscal consolidation and growth objectives for imposing monetary penalties and compounding by continued focus on capex alongside measures offences under the Payment and Settlement Systems to support consumption while providing a clear Act, 2007.31 As of January 31, 2025, two entities have roadmap for debt consolidation. Domestic demand is successfully completed the test phase under the ‘On also expected to benefit from the repo rate cut by the Tap’ application facility for the theme ‘Retail Payments’ MPC in its meeting on February 7, 2025. of the Regulatory Sandbox in January, 2025.32 Robust kharif production and better rabi sowing, V. Conclusion coupled with higher reservoir levels and seasonal The near-term outlook of the global economy winter correction in vegetable prices, augur well for is being shaped by trade-related policies of major food inflation going forward. While core inflation economies amidst slowing pace of disinflation. There remains muted, uncertainty in global financial markets, volatility in energy prices and adverse 28 RBI. 2025. Payment System Report, December 2024. weather events present upside risks to the inflation 29 RBI Press Releases. February 07, 2025. trajectory.33 30 RBI Notifications. January 17, 2025. Prevention of financial frauds perpetrated using voice calls and SMS – Regulatory Prescriptions and Institutional Safeguards. 31 RBI Notifications. January 30, 2025. Framework for imposing monetary penalty and compounding of offences under the Payment and Settlement Systems Act, 2007. 32 RBI Press Release. January 29, 2025. Regulatory Sandbox: On Tap 33 Monetary Policy Statement, 2024-25. Resolution of the Monetary Policy application on theme ‘Retail Payments’ – Completion of Test Phase. Committee, February 5-7, 2025. RBI Bulletin February 2025 61ARTICLE State of the Economy Annex I Major Takeaways from the RBI’s Enterprise Surveys Capacity utilisation (CU) in the manufacturing sector increased marginally to 74.2 per cent in Q2:2024-25 from 74.0 per cent in the previous quarter. The seasonally adjusted CU, however, declined by 110 basis points from the previous quarter to 74.7 per cent. Manufacturers maintained a positive outlook on CU in the ensuing quarters (Charts A1 and A2). Chart A1: Capacity Utilisation in Manufacturing Sector Source: Order Books, Inventories and Capacity Utilisation Survey, RBI. 62 RBI Bulletin February 2025 8.57 7.47 80 74.0 75 74.2 73.8 70 65 60 55 50 45 40 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 tnec reP CU seasonally adjusted CU CU long term average )tnec rep( esnopser teN Chart A2: Manufacturers' Assessment and Expectations on Capacity Utilisation 70 50 46.6 45.0 30 17.4 10 15.1 -10 -30 -50 -70 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Assessment Expectations Source: Industrial Outlook Survey, RBI.State of the Economy ARTICLE All major sectors remain optimistic on production/turnover and the overall business situation till Q2:2025- 26 (Charts A3 and A4). Employment situation is in sync with demand conditions (Chart A5). RBI Bulletin February 2025 63 )tnec rep( esnopser teN Chart A3: Expectations on Production/Turnover 80 73.2 72.1 60 50.9 40 20 0 -20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Manufacturing Services Sources: Industrial Outlook Survey; and Services and Infrastructure Outlook Survey, RBI. )tnec rep( esnopser teN Chart A4: Expectations on Overall Business Situation 90 80 73.0 70 68.0 60 51.6 50 40 30 20 10 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Manufacturing Services Infrastructure Sources: Industrial Outlook Survey; and Services and Infrastructure Outlook Survey, RBI.ARTICLE State of the Economy High input cost pressures are likely to persist across the major sectors (Chart A6). 64 RBI Bulletin February 2025 )tnec rep( esnopser teN Chart A5: Expectations on Overall Employment Situation 80 64.8 60 57.8 56.7 54.4 40 26.1 20 0 -20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Manufacturing Services (full time) Infrastructure (part time) Services (part time) Infrastructure (full time) Sources: Industrial Outlook Survey; and Services and Infrastructure Outlook Survey, RBI. )tnec rep( esnopser teN Chart A6: Expectations on Input Cost 100 80 64.9 60 64.2 49.3 40 20 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Manufacturing Services Infrastructure Sources: Industrial Outlook Survey; and Services and Infrastructure Outlook Survey, RBI.State of the Economy ARTICLE The pace of increase in selling prices and profit margins are expected to slow down for the manufacturing sector in Q4:2024-25. Higher growth in selling prices and profit margins is expected for the services and infrastructure sectors in Q4:2024-25 (Chart A7). Bankers expect higher loan demand and easy terms and conditions for loans across major sectors (Chart A8). RBI Bulletin February 2025 65 )tnec rep( esnopser teN Chart A7: Expectations on Selling Price 80 61.7 60 57.2 40 28.4 20 0 -20 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025- 26 Manufacturing Services Infrastructure Sources: Industrial Outlook Survey; and Services and Infrastructure Outlook Survey, RBI. )tnec rep( esnopser teN )tnec rep( htworg tiderC Chart A8: Senior Loan Officers' Assessment and Expectations on Credit Demand 8 70 6 50 46.3 40.7 4 3.6 30 2 10 0 -10 -2 -30 -4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 2019-20 2020-21 2021-22 2022-23 2023-24 2024-25 2025 -26 Assessment Expectations Actual credit growth (Q-o-Q) (RHS) Source: Bank Lending Survey, RBI. Note: The ‘net response’ is calculated as the difference between the percentage of respondents reporting optimism and that reporting pessimism. The increase option (I) is an optimistic response for all parameters, except the cost related parameters, such as cost of raw materials, etc., where the decrease option (D) signifies optimism from the viewpoint of a respondent company.Union Budget 2025-26: An Assessment ARTICLE Union Budget 2025-26: frameworks - to enhance overall factor productivity and ensure a more efficient allocation of resources in An Assessment the economy. by Akash Raj, Harshita Yadav, On the direct tax front, the Budget proposes tax relief of ₹1 lakh crore focused on middle-class Kovuri Akash Yadav, Aayushi Khandelwal, taxpayers, which is expected to bolster household Anoop K Suresh, and Samir Ranjan Behera^ disposable incomes, and stimulate consumption, savings, and investment. In the realm of indirect The Union Budget 2025–26 reaffirms the taxation, revised customs duties target tariff Government’s commitment to fiscal discipline while simplification and address duty inversions. fostering inclusive, long-term economic growth in On the expenditure side, the Budget 2025-26 line with the vision of ‘Viksit Bharat’. The Budget earmarks ₹11.2 lakh crore (3.1 per cent of GDP) for announced several measures under four engines of growth capital expenditure, continuing the impetus observed – agriculture, MSMEs, investment, and exports. The in the previous fiscal years. Similarly, the effective Government continued with its focus on capex alongside capital expenditure is budgeted to increase to 4.3 per measures to support consumption. With a fiscal deficit cent of GDP in 2025-26 from 4.1 per cent of GDP in target of 4.4 per cent of GDP, the Budget prudently 2024-25 (RE). Revenue expenditure is projected to balances fiscal consolidation and growth objectives. fall from 11.4 per cent of GDP in 2024-25 (RE) to 11.0 Introduction per cent in 2025-26 (BE). To further encourage State The Union Budget 2025–26 focuses on accelerating governments to augment their own capital spending, growth, securing inclusive development, invigorating the ‘Special Assistance as Loans to States for Capital private sector investments, uplifting household Expenditure’ has been extended with a provision of sentiments, and enhancing the spending power of ₹1.5 lakh crore. India’s rising middle class. Four principal drivers – The Union Budget balances growth imperatives agriculture, micro, small and medium enterprises with fiscal prudence by targeting gross fiscal deficit (MSMEs), investment, and exports – are envisaged (GFD) at 4.4 per cent of GDP in 2025-26 (BE), down to propel growth, with innovation and reform acting from the revised estimates (RE) of 4.8 per cent in as the vital catalysts. The Budget presents a balanced 2024-25, adhering to its objective of bringing the GFD focus on immediate socio-economic relief and long- below 4.5 per cent of GDP by 2025-26. From 2026-27 term structural transformation. It underscores the onwards, the Government aims to maintain the fiscal deployment of targeted measures across ten thematic deficit on a trajectory that ensures a declining public areas, ranging from agricultural productivity and debt-to-GDP ratio, reaching around 50 per cent by rural prosperity to the modernisation of urban March 2031. infrastructure and the strengthening of energy Against this backdrop, the rest of the article is security. The Budget articulates a reform agenda spanning six domains - taxation, power, urban divided into eight sections. Section II is a discussion development, mining, financial sector, and regulatory of the underlying drivers of fiscal deficit, followed by analyses of revenue and expenditure trends in ^ The authors are thankful to Smt. Rekha Misra for her overall guidance Sections III and IV, respectively. Section V outlines in preparing this article. The authors are from the Department of Economic and Policy Research of the Reserve Bank of India. The views expressed in the Government’s outstanding debt position, while this article are those of the authors and do not necessarily represent the views of the Reserve Bank of India. Section VI focuses on the major sources of fiscal RBI Bulletin February 2025 67ARTICLE Union Budget 2025-26: An Assessment deficit financing. Section VII examines the transfer of Table 1: Key Fiscal Indicators2 resources to States whereas Section VIII puts forth the (Per cent of GDP) concluding observations. Item 2023-24 2024-25 2025-26 Actuals BE RE BE II. Fiscal Deficit – The Underlying Dynamics 1 2 3 4 5 As against the budgeted GFD of 4.9 per cent of 1. Fiscal Deficit 5.6 4.9 4.8 4.4 GDP for 2024-25, the revised estimates are placed 2. Primary Deficit 2.0 1.4 1.3 0.8 3. Revenue Deficit 2.6 1.8 1.9 1.5 at 4.8 per cent. The 10-basis point consolidation is 4. Effective Revenue Deficit 1.6 0.6 1.0 0.3 primarily attributable to lower than budgeted capital 5. Gross Tax Revenue 11.7 11.8 11.9 12.0 expenditure (Chart 1). 6. Non-Tax Revenue 1.4 1.7 1.6 1.6 7. Revenue Expenditure 11.8 11.4 11.4 11.0 The GFD for 2025-26 (BE) is set at 4.4 per cent 8. Capital Expenditure 3.2 3.4 3.1 3.1 of the GDP.1 The envisaged consolidation of 45 basis of which: points for 2025-26 (BE) vis-à-vis 2024-25 (RE) is sought (i) Capital Outlay 2.7 2.8 2.6 2.5 to be achieved through containment of revenue 9. Effective Capital Expenditure 4.2 4.6 4.1 4.3 expenditure at 11.0 per cent of GDP [from 11.4 per cent 10. Debt 58.7 56.8 57.1 56.0 Notes: 1. Effective revenue deficit is the difference between revenue in 2024-25 (RE)] and maintaining capital expenditure deficit and grants-in-aid for creation of capital assets. at 3.1 per cent of GDP, while aiming to augment gross 2. Capital outlay is capital expenditure less loans and advances. 3. Effective capital expenditure is capital expenditure plus grants- tax revenues to 12.0 per cent of GDP (from 11.9 per in-aid for creation of capital assets. cent of GDP in RE for 2024-25) [Table 1]. The revenue 4. BE refers to budget estimates, RE refers to revised estimates. Sources: Union budget documents; and RBI staff estimates. expenditure - capital outlay (RE-CO) ratio – a summary Decomposition of GFD indicator of the quality of expenditure - is retained at The share of GFD appropriated by revenue deficit 4.4 in 2025-26 (BE). (RD) declined from an average of around 65.7 per cent Chart 1: Contribution to Attainment of Fiscal during 2018-19 to 2023-24, to 38.9 per cent in 2024- Deficit Target in 2024-25 (RE) vis-à-vis 2024-25 (BE) 25 (RE), is budgeted to fall further to 33.4 per cent in 2025-26. Concomitantly, the share of growth-inducing capital outlay in GFD has risen to 54.0 per cent in 2024-25 (RE) and is expected to reach 57.1 per cent in 2025-26 (BE), from an average of around 35.2 per cent over 2018-19 to 2023-24 (Chart 2). III. Receipts Total non-debt receipts recorded a growth of 12.8 per cent in 2024-25 (RE) and stood at 9.7 per cent of the GDP. The robust growth in tax revenue, higher surplus transfers from the Reserve Bank, and improved dividend income from public sector banks Sources: Union budget documents; and RBI staff estimates. and financial institutions supported the improved performance of receipts in 2024-25 (RE) vis-à-vis 1 The Union Budget has projected GDP for 2025-26 at ₹356,97,923 crore which is 10.1 per cent over the first advance estimates (FAE) for 2024-25 2023-24. For 2025-26 (BE), the government expects of ₹324,11,406 crore released by the Ministry of Statistics & Programme Implementation (MoSPI) on January 7, 2025. 2 For details, please refer to Annex I. 68 RBI Bulletin February 2025 PDG fo tnec reP 0.30 0.29 0.25 0.20 0.15 0.10 0.05 0.03 0.00 -0.05 -0.03 -0.05 -0.06 -0.10 -0.08 -0.15 Net tax Non-tax Non-debt Revenue Capital Due to revenue revenue capital expenditureexpenditure GDP receiptsUnion Budget 2025-26: An Assessment ARTICLE Tax Revenues Chart 2: Decomposition of Gross Fiscal Deficit Gross tax revenue recorded a growth of 11.2 per cent in 2024-25 (RE) over 2023-24, driven by income tax and GST collections. For 2025-26, the government has budgeted a 10.8 per cent growth in gross tax revenue, with the tax buoyancy remaining broadly in line with the average during 2010-11 to 2018-19. The buoyancy of the direct taxes is placed lower at 1.25 in 2025-26 (BE) compared to 1.47 in 2024-25 (RE) reflecting income tax relief, while that of indirect taxes is expected to recover to 0.82 in 2025-26 (BE) from 0.73 in 2024-25 (RE) on the back of gains in customs and excise duties (Chart 3a and b). The gross tax-GDP ratio is budgeted to increase to 12.0 per cent in 2025-26, the highest post 2007-08 Source: Union budget documents. (Chart 4). The Budget has raised the tax-free income the non-debt receipts to maintain their momentum, limit from ₹7 lakh to ₹12 lakh under the new tax growing from 9.7 per cent of GDP in 2024-25 (RE) to regime. Moreover, tax slabs have been revised across 9.8 per cent of GDP in 2025-26 (BE). Gross tax revenue all income brackets. The tax relief is expected to is budgeted to grow by 10.8 per cent in 2025-26, along enhance disposable incomes and provide a boost to with a 9.8 per cent increase in non-tax revenue. With household consumption and investments. The total devolution to the States budgeted to grow by 10.5 per revenue foregone on account of various measures is cent vis-à-vis 2024-25 (RE), net tax revenue is expected estimated at around ₹1 lakh crore in direct taxes and to increase by 11.0 per cent in 2025-26 (BE). ₹2,600 crore in indirect taxes.3 RBI Bulletin February 2025 69 DFG fo tnec reP 120.0 100.0 80.0 34.1 33.7 36.7 36.0 46.9 47.6 56.9 54.0 57.1 60.0 40.0 20.0 75.7 65.1 59.6 61.6 48.7 46.2 36.0 38.9 33.4 0.0 -20.0 BE Actual BE Actual BE Actual BE RE BE 2021-22 2022-23 2023-24 2024-25 2025-26 Revenue deficit Net lending Capital outlay Disinvestment Chart 3: Trends in Tax Buoyancy a. Major Direct and Indirect Taxes b. Tax Revenue Sources: Union budget documents; and RBI staff estimates. ycnayoub xaT ycnayoub xaT 2.5 1.6 1.4 2.0 1.2 1.0 1.5 0.8 1.0 0.6 0.4 0.5 0.2 0.0 0.0 Corporation Income tax GST Customs Union Gross tax Direct taxes Indirect tax duty excise duty revenue taxes Average tax buoyancy (2010-11 to 2018-19) 2025-26 (BE) Average tax buoyancy (2010-11 to 2018-19) 2025-26 (BE) 2024-25 (RE) 2024-25 (RE) 3 As mentioned in the Union Budget 2025-26 speech of the Finance Minister.ARTICLE Union Budget 2025-26: An Assessment Chart 4: Tax-GDP Ratio Sources: Union budget documents; and RBI staff estimates. Direct Taxes line with the budget estimates. In 2025-26 (BE), the With a growth of 14.4 per cent, direct taxes in 2024- growth in the indirect tax collections is budgeted at 8.3 per cent, with GST, customs, and excise collections 25 (RE) surpassed the budget estimates by ₹30,000 growth at 10.9 per cent, 2.1 per cent, and 3.9 per cent, crore. Income tax revenues with a growth of 18.8 per respectively (Chart 7). cent offset the shortfall of ₹40,000 crore in corporate tax collections compared to the BE. During 2024-25 (RE), the securities transaction tax outperformed its BE of ₹37,000 crore by 48.6 per cent; it is budgeted to further increase by 41.8 per cent in 2025-26 (BE) [Chart 5]. For 2025-26 (BE), direct tax revenues are expected to grow by 12.7 per cent, with growth in income and corporate tax at 13.1 per cent and 10.4 per cent, respectively (Chart 6). The Budget has announced various simplification and rationalisation measures aimed at promoting compliance and broadening the tax base. Indirect Taxes Indirect tax revenues rose by 7.1 per cent in 2024-25 (RE) but were below the budgeted amount, primarily on account of ₹14,000 crore shortfall in union excise duties.4 The GST collections were in 70 RBI Bulletin February 2025 PDG fo tnec reP 14 12.0 12 10 8 7.1 6 4.9 4 2 0 10-0002 20-1002 30-2002 40-3002 50-4002 60-5002 70-6002 80-7002 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 Chart 5: Securities Transaction Tax (STT) Gross tax revenue Direct tax Indirect tax Sources: Union budget documents; and RBI staff estimates. erorc dnasuoht ₹ PDG fo tnec reP 90 0.30 80 0.25 70 60 0.20 50 0.15 40 30 0.10 20 0.05 10 0 0.00 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 STT collections Per cent of GDP (RHS) Chart 6: Direct Taxes Sources: Union budget documents; and RBI staff estimates. erorc dnasuoht ₹ PDG fo tnec reP 3000 7.5 7.1 2500 6.9 7.0 6.6 2000 6.2 6.5 6.0 1500 6.0 1000 5.5 500 0 5.0 Corporation tax Direct taxes as per cent of GDP (RHS) Income tax Others 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 4 The moderation in union excise duties was led by a shortfall of ₹7,460 crore under special additional excise duties (SAED). In July 2022, the Union government introduced a SAED on production of crude oil and export of petrol, diesel and aviation turbine fuel. As per the notification issued by the Ministry of Finance, the same was rescinded in December 2024 (Source: Union Budget 2025-26; Petroleum Planning and Analysis Cell; and Central Board of Indirect Taxes & Customs).Union Budget 2025-26: An Assessment ARTICLE Non-Debt Capital Receipts Chart 7: Indirect Taxes Non-debt capital receipts in 2024-25 (RE) fell short of BE by ₹19,000 crore, primarily due to lower disinvestment receipts. In 2025-26 (BE), non-debt capital receipts are budgeted to grow by 28.8 per cent, with the disinvestment target of ₹47,000 crore (Chart 9). IV. Expenditure Total expenditure of the Union government recorded a growth of 6.1 per cent in 2024-25 (RE), and it was ₹1.04 lakh crore below the BE mainly due to the underutilisation of allocated capital expenditure (Table 2). The revenue expenditure, in contrast, was in line with the budget estimates and posted a growth of 5.8 per cent in 2024-25 (RE). For 2025-26 (BE), total expenditure is budgeted to rise by 7.4 per cent, Source: Union budget documents. reaching 14.2 per cent of GDP. Capital expenditure is Non-Tax Revenue expected to recover with a growth of 10.1 per cent. Supported by the higher surplus transfer from Additionally, effective capital expenditure is budgeted the Reserve Bank, non-tax revenue recorded a growth to register a growth of 17.4 per cent in 2025-26 vis-à- of 32.2 per cent in 2024-25 (RE). For 2025-26 (BE), the vis 5.2 per cent growth in 2024-25 (RE) on account of non-tax revenue growth is placed at 9.8 per cent, led 42.4 per cent growth in grants-in-aid for creation of by 25.5 per cent growth in dividends and profits from capital assets. The Budget maintains the allocation of public sector enterprises (PSEs), and 9.3 per cent from ₹1.5 lakh crore for the ‘Scheme for Special Assistance the Reserve Bank, public sector banks and financial to States for Capital Expenditure’, in 2025-26 (BE) as institutions (Chart 8). in 2024-25 (BE). Revenue expenditure is budgeted to RBI Bulletin February 2025 71 erorc dnasuoht ₹ PDG fo tnec reP 2000 6.0 5.5 5.2 5.1 5.5 5.0 1500 4.9 5.0 1000 4.5 4.0 500 3.5 0 3.0 GST Custom duty Union excise duty Others Indirect taxes as per cent of GDP (RHS) 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 Chart 8: Major Components of Non-Tax Revenue Source: Union budget documents. erorc dnasuoht ₹ 700 600 500 400 300 200 100 0 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 Chart 9: Disinvestment - Actual vis-à-vis Budgeted Interest receipts Dividends from financial institutions including Reserve Bank Dividends from public sector enterprises Others erorc dnasuoht ₹ 250 200 150 100 50 0 Note: Disinvestment receipts from 2023-24 onwards refers to ‘receipts’ under the head ‘miscellaneous capital receipts’. Source: Union budget documents. 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 52-4202 62-5202 Budget estimates Realised proceedsARTICLE Union Budget 2025-26: An Assessment Table 2: Expenditure of Central Government Item ₹ Thousand Crore Per cent of GDP Growth Rate (per cent) 2023-24 2024-25 2024-25 2025-26 2023-24 2024-25 2024-25 2025-26 2023-24 2024-25 2025-26 (BE) (RE) (BE) (BE) (RE) (BE) (RE) (BE) 1 2 3 4 5 6 7 8 9 10 11 12 1. Total Expenditure 4,443 4,821 4,716 5,065 15.0 14.8 14.6 14.2 6.0 6.1 7.4 2. Revenue Expenditure (RE) 3,494 3,709 3,698 3,944 11.8 11.4 11.4 11.0 1.2 5.8 6.7 (of which) (i) Interest Payments (IP) 1,064 1,163 1,138 1,276 3.6 3.6 3.5 3.6 14.6 7.0 12.2 (ii) Total Subsidies (TS) 435 428 428 426 1.5 1.3 1.3 1.2 -24.7 -1.6 -0.4 of which: Food 212 205 197 203 0.7 0.6 0.6 0.6 -22.4 -6.8 3.0 Fertiliser 188 164 171 168 0.6 0.5 0.5 0.5 -25.1 -9.0 -2.0 Petroleum 12 12 15 12 0.0 0.0 0.0 0.0 79.5 20.1 -17.7 (iii) RE-IP-TS 1,995 2,118 2,132 2,242 6.8 6.5 6.6 6.3 2.5 6.9 5.1 (v) Defence (Revenue) 303 298 313 328 1.0 0.9 1.0 0.9 12.7 3.3 4.8 3. Capital Expenditure 949 1,111 1,018 1,121 3.2 3.4 3.1 3.1 28.3 7.3 10.1 4. Effective Capital Expenditure 1,253 1,502 1,318 1,548 4.2 4.6 4.1 4.3 19.8 5.2 17.4 Source: Union budget documents. grow by 6.7 per cent, and RE-IP-TS by 5.1 per cent (6.3 Capital Outlay per cent of GDP). Capital outlay (capital expenditure less loans and Quality of Expenditure advances) grew by 7.6 per cent in 2024-25 (RE). It fell The revenue expenditure - capital outlay (RE-CO) short of the budgeted target by ₹70,959 crore, inter ratio stood at its lowest at 4.4 in both 2024-25 (RE) alia, due to the model code of conduct in the run-up to and 2025-26 (BE). Revenue deficit as per cent of gross the general elections and heavy rains in the monsoon fiscal deficit (RD-GFD) also stood at its all-time low of season. In 2025-26 (BE), capital outlay is budgeted 33.4 per cent, indicating improvement in the quality to grow by 5.6 per cent (Table 3). Capital outlays of of expenditure (Chart 10a and b). Railways, and Road and Bridges – the major drivers of Chart 10: Quality of Expenditure a. RE-CO and RE-CE b. RD-GFD Source: Union budget documents. 72 RBI Bulletin February 2025 oitaR tnec reP 14 12 10 8 6 4 2 Revenue expenditure to capital outlay (RE-CO) Revenue expenditure to capital expenditure (RE-CE) 10-0002 20-1002 30-2002 40-3002 50-4002 60-5002 70-6002 80-7002 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 90 80 70 60 50 40 30 20 10-0002 20-1002 30-2002 40-3002 50-4002 60-5002 70-6002 80-7002 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202Union Budget 2025-26: An Assessment ARTICLE Table 3: Capital Outlay Item ₹ Thousand Crore Growth Rate (per cent) 2023-24 2024-25 2024-25 2025-26 2023-24 2024-25 2025-26 (BE) (RE) (BE) (RE) (BE) 1 2 3 4 5 6 7 8 1. Total Capital Outlay 788 919 848 895 26.1 7.6 5.6 2. Defence Services 154 172 160 180 7.9 3.4 12.9 3. Capital Outlay (excluding defence) 634 747 688 715 31.6 8.6 3.9 (i) Major Infrastructure (of which) 576 600 590 573 34.7 2.4 -2.9 Indian Railways 243 252 252 252 52.3 3.9 0.0 Roads & Bridges 270 259 259 259 28.2 -4.1 0.1 Communications 61 84 75 50 8.8 24.0 -33.1 (ii) Industry & Minerals 6 6 13 12 -3.6 97.7 -3.1 (iii) Science, Technology and Environment 7 7 6 8 -8.1 -10.6 27.0 (iv) Others 44 133 79 122 11.2 80.0 54.3 Source: Union budget documents. the Centre’s capital spending – in 2025-26 (BE) have part of the government’s total capex. The combined been retained at their 2024-25 (RE) levels. capex of the Union government and CPSEs will increase marginally from 4.2 per cent of GDP in Combined Capex of the Union Government and 2024-25 (RE) to 4.3 per cent of GDP in 2025-26 (BE) Central Public Sector Enterprises [Chart 11]. Central public sector enterprises (CPSEs) Major Government Schemes finance their capex through internal and extra budgetary resources (IEBR)5 and budgetary Among central sector programmes, PMGKAY support from the Union government, which forms a receives the largest allocation at 4.0 per cent of total Chart 11: Capital Expenditure by Union Government and CPSEs RBI Bulletin February 2025 73 PDG fo tnec reP 6.0 5.0 4.7 5.0 4.4 4.3 4.4 4.2 4.3 4.1 4.0 4.1 4.0 3.9 4.0 4.0 4.1 4.0 4.0 3.6 3.4 3.0 2.0 1.0 0.0 Budget support to CPSEs Internal and extra budgetary resources (IEBR) Government capex excluding budget support to CPSEs Note: CPSEs capex is exclusive of Food Corporation of India (FCI). Source: Union budget documents. 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 5 IEBR comprises of internal resources (comprising of retained profits - net of dividend to Government, depreciation provision and carry forward of reserves and surpluses) and extra budgetary resources (consisting of receipts from issue of bonds, debentures, external commercial borrowing, suppliers’ credit, deposit receipts and term loans from financial institutions). Budgetary support and IEBR together finance the capital expenditure (capex) of CPSEs.ARTICLE Union Budget 2025-26: An Assessment Table 4: Expenditure on Major Government Schemes Item ₹ Thousand Crore Per cent of Total Growth Rate Expenditure (per cent) 2023-24 2024-25 2024-25 2025-26 2023-24 2024-25 2025-26 2023-24 2024-25 2025-26 (BE) (RE) (BE) (RE) (BE) (RE) (BE) 1 2 3 4 5 6 7 8 9 10 11 A. Central Sector Schemes 1. PM-KISAN 61 60 64 64 1.4 1.3 1.3 5.5 3.4 0 2. Pradhan Mantri Garib Kalyan Anna Yojana - 205 197 203 - 4.2 4.0 - - 3.0 (PMGKAY) 3. Road Works 109 115 111 116 2.4 2.3 2.3 43.3 1.7 5.2 B. Centrally Sponsored Schemes 1. MGNREGA 89 86 86 86 2.0 1.8 1.7 -1.8 -3.5 0.0 2. Jal Jeevan Mission 70 70 23 67 1.6 0.5 1.3 28.0 -67.6 195.2 3. Samagra Shiksha 33 38 37 41 0.7 0.8 0.8 1.0 12.7 11.5 4. National Health Programme* 25 29 29 30 0.6 0.6 0.6 2.8 15.8 4.3 5. PM Awas Yojana 43 85 48 78 1.0 1.0 1.5 -41.0 9.5 64.1 Note: 1. -: Not available. 2. *: Flexible Pool for RCH & Health System Strengthening, National Health Programme and National Urban Health Mission. Source: Union budget documents. expenditure in 2025-26 (BE) [4.2 per cent in 2024-25 increase). PM Awas Yojana’s outlay has been increased (RE)], with the outlay rising by 3.0 per cent to ₹2.03 by 64.1 per cent, with the Centre sustaining its focus on housing (Table 4). lakh crore. PM-KISAN allocation has been maintained at last year’s level; and road works’ outlay has been In recent years, there has been a significant expanded by 5.2 per cent to ₹1.16 lakh crore. Amongst increase in fund transfer by the government to the Centrally sponsored schemes, MGNREGA is beneficiaries under various social programmes through the DBT mechanism, resulting in savings for unchanged at ₹86,000 crore, the Jal Jeevan Mission’s the government (Box A). outlay is budgeted at ₹67,000 crore (195.2 per cent Box A: Direct Benefit Transfers in India – Decadal Experience In India, both the Central and State governments The DBT was launched on a pilot basis in select oversee a vast array of social transfers (viz., cash and districts on January 1, 2013, initially covering few in-kind transfers) to protect vulnerable populations. schemes. In 2013 itself, the Central government With the objective of reducing leakages and ensuring introduced the DBT for LPG subsidy payments, followed that intended beneficiaries receive timely transfers at by major schemes such as Mahatma Gandhi National minimal cost, the Centre introduced the Direct Benefit Rural Employment Guarantee Scheme (MGNREGS); Transfer (DBT) programme in 2013 (Paramasivam and National Social Assistance Programme (NSAP); Public Arun, 2018). It transfers subsidies directly to the bank Distribution System (PDS); and student scholarship account of verified beneficiaries, thereby minimising schemes (Paramasivam and Arun, 2018). By August the role of intermediaries in funds disbursal. Requiring 2015, DBT became the world’s largest cash transfer beneficiaries to possess bank account prevents programme providing direct benefits to around 14 duplication and leakage, while integration with the crore households (Barnwal, 2016). Similarly, during the Aadhar system strengthens verification (Barnwal, COVID-19 pandemic, DBT played a very significant role 2016). (Contd.) 74 RBI Bulletin February 2025Union Budget 2025-26: An Assessment ARTICLE Chart A.1: Progress of DBT in India a. Number of DBT Schemes b. Year wise DBT Beneficiaries (non-unique) c. DBT Fund Transfer d. Estimated Gains for Government Note: *: The data depicted in the charts for 2024-25 are those available in the official website of DBT accessed on mid February 2025. Source: https://dbtbharat.gov.in/ when the speed and scale of cash transfers in India public interventions implemented by India have been was unprecedented (Bhattacharya and Sinha, 2021). recommended by the World Bank for adoption by other countries for ensuring disaster resilience (World From a modest coverage of 28 schemes in 2013- Bank, 2022). 14, DBT has been implemented in 323 schemes across 54 ministries of the Central government during the References: financial year 2024-25 (Chart A.1a). The number of 1. Barnwal, P. (2016). Curbing Leakage in Public beneficiaries as well as the funds transferred under Programs with Direct Benefit Transfers: Evidence various schemes have also risen notably over time from India’s Fuel Subsidies and Black Market. (Charts A.1b and A.1c). Further, incorporating various Department of Economics, Michigan State social welfare programmes under the DBT umbrella University, April. has led to identification and removal of fake and 2. Bhattacharya, S. and Sinha, R. (2021). Intent duplicate beneficiaries, resulting in significant savings to Implementation: Summary of Lessons from (Chart A.1d). Tracking India’s Social Protection Response to For instance, the implementation of DBT has COVID-19 (English). Washington, D.C.: World Bank aided the Department of Fertilisers in reducing its Group. fertiliser sale to retailers by 158.1 lakh metric tonnes. 3. Paramasivam, C. and Arunkumar, G. (2018). Direct Similarly, in case of MGNREGS, payment through Benefit Transfer: An Innovative Approach to DBT has helped to eliminate 7.1 lakh fake job cards. Financial Inclusion in India. JETIR, 5(12), December. Likewise, channelling LPG subsidy payment through 4. World Bank. (2022). The Role of Digital in the DBT has resulted in elimination of 4.15 crore duplicate, COVID-19 Social Assistance Response (English). fake, or inactive LPG connections.6 The DBT-styled Washington, D.C.: World Bank Group. RBI Bulletin February 2025 75 semehcS fo rebmuN erorc ₹ 500 450 400 350 300 250 200 150 100 50 0 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 *52-4202 )erorc( seiraicifeneB fo rebmuN 200 180 160 140 120 100 80 60 40 20 0 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 *52-4202 8,00,000 7,00,000 6,00,000 5,00,000 4,00,000 3,00,000 2,00,000 1,00,000 0 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 *52-4202 erorc ₹ 4,00,000 3,50,000 3,00,000 2,50,000 2,00,000 1,50,000 1,00,000 50,000 0 Cumulative April 2022- Cumulative upto March March 2023 upto March 2022 2023 6 Data is upto March 2023 and has been sourced from https://dbtbharat.gov.in/.ARTICLE Union Budget 2025-26: An Assessment Chart 12: Total Expenditure on New and Renewable Energy The expenditure towards new and renewable help in bringing Centre’s debt-to-GDP ratio to 50 ±1 energy is budgeted to increase from 0.37 per cent of per cent by March 31, 2031. total expenditure in 2024-25 (RE) to 0.52 per cent in VI. Gross Fiscal Deficit Financing 2025-26 (BE) led by increased allocations towards PM On the financing side, gross market borrowings Surya Ghar Muft Bijli Yojana (Chart 12). The gender through dated securities for 2025-26 are budgeted at budget of the Union government is also budgeted to ₹14.82 lakh crore [an increase of about 5.8 per cent increase to 8.9 per cent of its total expenditure in over ₹14.01 lakh crore in 2024-25 (RE)]. Net market 2025-26, led by Pradhan Mantri Garib Kalyan Anna borrowings are placed at ₹11.54 lakh crore as compared Yojana and Pradhan Mantri Awas Yojana (Chart 13). with the previous year’s ₹10.75 lakh crore.7 The Budget V. Outstanding Debt has also provided for gross switches of securities After peaking at 62.6 per cent of GDP in totalling ₹2.50 lakh crore in 2025-26, as against ₹1.47 2020-21 amidst the COVID-19 pandemic, the lakh crore in the previous year’s revised estimates. total outstanding debt of the Union government The government has not budgeted for any buyback declined to 57.1 per cent of GDP in 2024-25 (RE) of securities during 2025-26. Net market borrowings from 58.7 per cent in 2023-24 and is budgeted to are expected to finance 73.5 per cent of GFD in 2025- decline further to 56.0 per cent of GDP in 2025-26. 26 (BE), higher than 68.5 per cent in 2024-25 (RE). An The interest payment to revenue receipts ratio is amount of ₹3.43 lakh crore from small savings (NSSF) budgeted at 37.3 per cent in 2025-26. The interest would finance 21.9 per cent of GFD in 2025-26 (BE), rate – growth rate differential (IRGD), an indicator down from ₹4.12 lakh crore (26.2 per cent) in 2024- of debt sustainability, remains favourable (Chart 14a 25(RE) [Chart 15]. and b). Going forward, the government has indicated that it would maintain a fiscal deficit level which will 76 RBI Bulletin February 2025 erorc dnasuoht ₹ tnec reP 30 0.60 25 0.50 20 0.40 15 0.30 10 0.20 5 0.10 0 0.00 Source: Union budget documents. 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 Total expenditure on new and renewable energy Expenditure on new and renewable energy as per cent of total expenditure (RHS) erorc dnasuoht ₹ tnec reP Chart 13: Gender Budget 350 9 8 300 7 250 6 200 5 150 4 3 100 2 50 1 0 0 Schemes with 100 per cent provision towards women welfare Schemes with atleast 30 per cent provision towards women welfare Gender budget as per cent of total expenditure (RHS) Source: Union budget documents. 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 7 Net market borrowing figures for 2024-25 (RE) includes buy back of securities [₹ (-)88,164.01 crore].Union Budget 2025-26: An Assessment ARTICLE Chart 14: Outstanding Liabilities and Interest Rate Growth Differential b. Interest Rate - Growth Differential Sources: Union budget documents; and RBI staff estimates. The gradual downscaling in the market borrowing [10.2 per cent during 2024-25 (RE)], largely on requirements (as per cent of GDP) of the Union account of transfers under centrally sponsored government towards the pre-pandemic level will schemes and special assistance to States for capital facilitate greater availability of resources for the expenditure. The gross transfer of resources to private sector (Table 5). States will increase from 7.0 per cent of GDP during VII. Resource Transfer from Centre to States Table 5: Market Borrowings of the Union Government The gross transfers to States have been (₹ crore) budgeted to increase by 12.5 per cent for 2025-26 Financial Year Gross Market Borrowings Net Market Borrowings 2018-19 5,71,000 4,22,735 (3.0) (2.2) 2019-20 7,10,000 4,73,968 (3.5) (2.4) 2020-21 12,60,116 10,32,907 (6.3) (5.2) 2021-22 9,68,382 7,04,097 (4.1) (3.0) 2022-23 14,21,000 11,08,259 (5.3) (4.1) 2023-24 15,43,000 11,77,754 (5.2) (4.0) 2024-25 (RE) 14,00,697 10,74,514 (4.3) (3.3) 2025-26 (BE) 14,82,000 11,53,834 (4.2) (3.2) Notes: 1. Net Market Borrowings for 2024-25 (RE) includes buy back of securities. 2. From 2023-24 onwards, market borrowings have been adjusted for switching of securities. 3. Figures in parentheses are as per cent of GDP. Source: Union budget documents. RBI Bulletin February 2025 77 tnec reP tnec reP a. Debt and Interest Burden of Union Government 70 60 50 40 30 20 10 0 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 10 5 0 -5 -10 -15 Debt as per cent of GDP Interest payments per cent of revenue receipts 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 52-4202 62-5202 Chart 15: Sources of Financing Gross Fiscal Deficit Source: Union budget documents. DFG fo tnec reP 120 100 80 60 40 20 0 -20 22-1202 32-2202 42-3202 )ER( 52-4202 )EB( 62-5202 Net market borrowings Net treasury bills Securities against small savings External assistance Drawdown of cash balances OthersARTICLE Union Budget 2025-26: An Assessment Chart 16: Gross Resource Transfer to States and UTs b. Share in Gross Transfer to States in 2025-26 (BE) Source: Union budget documents. 2024-25 (RE) to 7.2 per cent during 2025-26 (BE). While tax devolution forms the cornerstone of Devolution of States’ share in taxes constitutes the fiscal transfers, post-devolution revenue deficit grants largest component of gross transfers (Chart 16a (RDGs) play a crucial role in stabilising state finances and b).8 by bridging structural fiscal gaps (Box B). Box B: Revenue Deficit Grants - An Instrument for States’ Fiscal Stability The Finance Commission is, inter alia, entrusted Historically, all Finance Commissions have with the task of mitigating revenue shortfalls and recommended RDGs to address fiscal imbalances cost disparities that hinder various States from among States and allocated it based on normative delivering high-quality public services (Rao, 2022). assessments of States’ revenue and expenditure gaps. In this context, Finance Commission grants serve Additionally, RDGs help States transition through as a crucial supplement to the formula-based tax changes in tax devolution patterns recommended by devolution targeting State-specific fiscal needs such as successive Finance Commissions. They allow States disaster relief, development of local bodies, sectoral time to adjust their fiscal positions in line with investments, and revenue deficit support. These grants evolving assessments of needs, fiscal capacity, and help States with weaker fiscal capacities to meet their governance performance (Finance Commission - XV). expenditure obligations without excessive borrowing. Among these, post-devolution revenue deficit grants RDGs could create moral hazard, where (RDGs) play a particularly vital role by bridging post- reliance on Central grants discourages States devolution revenue shortfalls. Provided under Article from implementing critical fiscal reforms, such 275 of the Constitution, RDGs help to maintain as improving tax administration or expenditure fiscal stability and enable States to sustain essential rationalisation. Successive Finance Commissions governance and developmental commitments. have sought to mitigate these concerns by adopting (Contd.) 8 For details, please refer to Annex II. 78 RBI Bulletin February 2025 erorc hkal ₹ a. Resource Transfer to States/UTs 16 14.2 14 12.9 12 10 8 6 5.1 3.9 4 3.33.5 2 1.3 1.5 1.31.3 0 Devolution Special Finance Transfer Others of states' assistance as commission under share in loan to states grants centrally Devolution of states' share in taxes Transfer under centrally taxes for capital sponsored Special assistance as loan to states for sponsored schemes expenditure schemes capital expenditure Others 2024-2025 (RE) 2025-2026 (BE) Finance commission grantsUnion Budget 2025-26: An Assessment ARTICLE Chart B.1: Revenue Deficit of States: Actual vs. Without RD Grants Sources: Union budget documents; and Reserve Bank’s State Finances: A Study of Budgets of 2024-25. a normative approach to assess each States’ fiscal increased borrowing or expenditure cuts, thereby needs. Unlike a simple gap-filling approach, which weakening public service delivery and development could inadvertently reward inadequate revenue effort expenditures. or excessive spending, this normative framework corrects for structural deficiencies in fiscal capacity Over the past 15 years, RDGs have helped States while discouraging fiscal profligacy (Reddy and reduce their deficits by 0.2 to 0.3 per cent of GDP on Reddy, 2019). The Fifteenth Finance Commission average, preventing excessive borrowing and enabling recommended that States should, over time, eliminate stable public spending. Central transfers, including their post-devolution revenue gaps. Consequently, RDGs, remain an essential mechanism for supporting the recommended revenue deficit grants declined fiscal federalism and help States in pursuing their from ₹1.18 lakh crore in the first year to ₹13,705 crore developmental goals while maintaining fiscal in the final year of its award period. The number of States eligible for these grants came down from responsibility. 17 during the first year to 6 in the final year. This References: phased tapering of grants would provide the States 1. Government of India (2020). Report of the Fifteenth reasonable time to make suitable adjustments in their fiscal management to eliminate their post-devolution Finance Commission. Volume 1. Ministry of revenue deficits (Rao, 2021). Finance, Government of India. An analysis of overall revenue deficit of States 2. Rao, M. G. (2021). Fiscal Transfers in Pandemic with and without RDGs highlights their stabilising Times. Economic and Political Weekly, 56(33). effect on State finances. The onset of the pandemic 3. Rao, M. G. (2022). Studies in Indian Public Finance. placed additional strain on State finances, and RDGs Oxford University Press. played a pivotal role in cushioning the associated 4. Reddy, Y. V., and Reddy, G. R. (2018). Indian Fiscal fiscal shock. Without RDGs, States would have Federalism. Oxford University Press. faced a higher revenue deficit by 29 basis points during the 2020-25 period (Chart B.1), necessitating 5. Various Finance Commission Reports. RBI Bulletin February 2025 79 PDG fo tnec reP stniop sisaB 2.50 35 29 30 23 2.00 25 1.50 20 11 15 1.00 10 0.50 5 0 0.00 -5 -0.50 -10 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 52-4202 Average difference (RHS) Revenue deficit (Acutal) Revenue deficit (Without grants)ARTICLE Union Budget 2025-26: An Assessment Table 6: Finance Commission (FC) Grants to States and UTs Item ₹ Lakh Crore Share in Total FC Grants Growth (per cent) (per cent) 2024-25 (RE) 2025-26 (BE) 2024-25 (RE) 2025-26 (BE) 2024-25 (RE) 2025-26 (BE) Finance Commission (FC) Grants 1.3 1.3 - - -14.4 4.4 1. Grant for Local Bodies - Urban Bodies 0.2 0.3 16.5 19.7 -1.1 24.6 2. Grant for Local Bodies - Rural Bodies 0.5 0.5 35.4 36.6 -4.8 7.9 3. Grants for Health Sector 0.1 0.2 8.0 11.5 117.9 49.4 4. Post Devolution Revenue Deficit Grants 0.2 0.1 19.3 10.3 -52.6 -44.0 5. Others* 0.3 0.3 20.8 21.9 11.7 9.9 Note: ‘Others’ includes Grants for incubation of new cities, Grants for shared Municipal Services, Grants-in-Aid for State Disaster Response Fund and Grants-in-Aid for State Disaster Mitigation Fund. Source: Union budget documents. Finance commission Grants are budgeted to MoUs to be signed with States to ensure sustainable increase by 4.4 per cent in 2025-26, mainly due to rural water supply. The Union government will also increase in grants for local bodies (both urban and partner with States to develop 50 tourist destinations rural) as well as grants for health sector (Table 6). through a challenge-based mode. States must provide land for infrastructure to qualify for funding. The Budget has allocated ₹1.5 lakh crore under the 50-year interest-free loans for States’ capital VIII. Conclusion expenditure and reform-linked incentives. Urban The Union Budget 2025–26 reaffirms the sector reforms will be incentivised, focusing on Government’s commitment to fiscal discipline while governance and municipal services. Towards fostering inclusive, long-term economic growth in boosting infrastructure, States will be encouraged line with the vision of ‘Viksit Bharat’. Towards this to seek funding for PPP projects under the India objective, the Budget has announced several measures Infrastructure Project Development Fund. The Budget under four engines of growth – agriculture, MSMEs, proposes key power sector reforms to improve State- investment, and exports propelled by innovation and level electricity distribution and infrastructure. States structural reforms. The Government has continued will be incentivised to enhance financial health and with its focus on capex alongside consumption efficiency of electricity distribution companies. To boosting measures which would help the economy to support this, States undertaking reforms will be improve its growth momentum. With a fiscal deficit allowed an additional borrowing of 0.5 per cent of target of 4.4 per cent of GDP, the Budget balances gross state domestic product.. consolidation and growth objectives. The government Many sector-specific initiatives in partnership would deploy debt/GDP ratio as a medium-term fiscal with the States have been announced. In agriculture, anchor going forward to preserve macroeconomic States’ partnership is sought to implement schemes stability. Through structural reforms, augmented like Prime Minister Dhan-Dhaanya Krishi Yojana, investments in critical sectors, and the rationalisation Rural Prosperity and Resilience Programme and of taxes and expenditure, the Government seeks Comprehensive Programme for Vegetables and Fruits. to maintain a stable macroeconomic environment The Jal Jeevan Mission is extended until 2028, with conducive to robust and sustainable growth. 80 RBI Bulletin February 2025Union Budget 2025-26: An Assessment ARTICLE Annex I: Union Budget 2025-26 - Key Fiscal Indicators Item ₹ Thousand Crore Per cent of GDP Growth Rate 2022-23 2023-24 2024-25 2024-25 2025-26 2023-24 2024-25 2025-26 2023-24 2024-25 2025-26 (BE) (RE) (BE) (RE) (BE) (RE) (BE) 1 2 3 4 5 6 7 8 9 10 11 12 1. Direct Tax 1,660 1,956 2,207 2,237 2,520 6.6 6.9 7.1 17.9 14.4 12.7 (i) Corporation 826 911 1,020 980 1,082 3.1 3.0 3.0 10.3 7.6 10.4 (ii) Income 809 1,011 1,150 1,202 1,360 3.4 3.7 3.8 25.0 18.8 13.1 (iii) Securities Transaction Tax 25 34 37 55 78 0.1 0.2 0.2 34.7 62.8 41.8 2. Indirect Tax 1,394 1,509 1,633 1,616 1,750 5.1 5.0 4.9 8.2 7.1 8.3 (i) GST 849 957 1,062 1,062 1,178 3.2 3.3 3.3 12.7 10.9 10.9 (ii) Customs 213 233 238 235 240 0.8 0.7 0.7 9.3 0.8 2.1 (iii) Excise 323 309 324 310 322 1.0 1.0 0.9 -4.2 0.2 3.9 3. Gross Tax Revenue (1+2) 3,054 3,466 3,840 3,853 4,270 11.7 11.9 12.0 13.5 11.2 10.8 4. Assignment to States 948 1,129 1,247 1,287 1,422 3.8 4.0 4.0 19.1 13.9 10.5 5. NCCD Transfers 8 9 9 10 10 0.0 0.0 0.0 9.7 9.5 8.0 6. Net Tax Revenue (3-4-5) 2,098 2,327 2,583 2,557 2,837 7.9 7.9 7.9 10.9 9.9 11.0 7. Non-tax Revenue 285 402 546 531 583 1.4 1.6 1.6 40.8 32.2 9.8 (i) Dividends and Profits 100 171 289 289 325 0.6 0.9 0.9 71.0 69.3 12.3 (ii) Interest Receipts 28 38 38 34 48 0.1 0.1 0.1 37.4 -11.0 40.2 8. Revenue Receipts (6+7) 2,383 2,729 3,129 3,088 3,420 9.2 9.5 9.6 14.5 13.2 10.8 9. Non debt Capital Receipts 72 60 78 59 76 0.2 0.2 0.2 -17.2 -1.3 28.8 (i) Miscellaneous Capital Receipts 46 33 50 33 47 0.1 0.1 0.1 -28.1 -0.4 42.4 (ii) Recovery of Loans 26 27 28 26 29 0.1 0.1 0.1 1.9 -2.4 11.5 10. Total Receipts (ex. Borrowings) (8+9) 2,455 2,789 3,207 3,147 3,496 9.4 9.7 9.8 13.6 12.8 11.1 11. Revenue Expenditure (RE) 3,453 3,494 3,709 3,698 3,944 11.8 11.4 11.0 1.2 5.8 6.7 (i) Interest Payments (IP) 929 1,064 1,163 1,138 1,276 3.6 3.5 3.6 14.6 7.0 12.2 (ii) Total Subsidies (TS) 578 435 428 428 426 1.5 1.3 1.2 -24.7 -1.6 -0.4 of which: Food 273 212 205 197 203 0.7 0.6 0.6 -22.4 -6.8 3.0 Fertiliser 251 188 164 171 168 0.6 0.5 0.5 -25.1 -9.0 -2.0 Petroleum 7 12 12 15 12 0.0 0.0 0.0 79.5 20.1 -17.7 (iii) RE-IP-TS 1,947 1,995 2,118 2,132 2,242 6.8 6.6 6.3 2.5 6.9 5.1 12. Capital Expenditure (i + ii) 740 949 1,111 1,018 1,121 3.2 3.1 3.1 28.3 7.3 10.1 (i) Capital Outlay 625 788 919 848 895 2.7 2.6 2.5 26.1 7.6 5.6 (ii) Loans & Advances 115 161 192 171 226 0.5 0.5 0.6 39.8 6.0 32.3 13. Total Expenditure (11+12) 4,193 4,443 4,821 4,716 5,065 15.0 14.6 14.2 6.0 6.1 7.4 14. Gross Fiscal Deficit (13-10) 1,738 1,655 1,613 1,570 1,569 5.6 4.8 4.4 -4.8 -5.1 -0.04 Source: Union budget documents RBI Bulletin February 2025 81ARTICLE Union Budget 2025-26: An Assessment Annex II: Resource Transfers from Centre to States and UTs with Legislature Item ₹ Thousand Crore As per cent of Growth Rate Gross Transfers 2023-24 2024-25 2025-26 2023-24 2024-25 2025-26 2023-24 2024-25 2025-26 (RE) (BE) (RE) (BE) (RE) (BE 1 2 3 4 5 6 7 8 9 10 I. Devolution of States Share in Taxes 1,129 1,287 1,422 54.7 56.6 55.6 19.1 13.9 10.5 II. Finance Commission Grants 148.5 127.1 132.8 7.2 5.6 5.2 -14.0 -14.4 4.4 of which: 1. Grant for Local Bodies - Urban Bodies 21.2 21.0 26.2 1.0 0.9 1.0 19.2 -1.1 24.6 2. Grant for Local Bodies - Rural Bodies 47.3 45.0 48.6 2.3 2.0 1.9 3.6 -4.8 7.9 3. Grants for Health Sector 4.7 10.2 15.3 0.2 0.4 0.6 42.2 117.9 49.4 4. Grants-in-Aid for SDRF 19.4 20.6 21.6 0.9 0.9 0.8 18.4 5.8 5.0 5. Grants-in-Aid for State Disaster Mitigation Fund 4.3 5.1 5.4 0.2 0.2 0.2 21.5 20.8 5.0 6. Post Devolution Revenue Deficit Grants 51.7 24.5 13.7 2.5 1.1 0.5 -40.1 -52.6 -44.0 III. Some Important Items of Transfer 160.3 201.1 229.0 7.8 8.8 8.9 33.1 25.5 13.9 of which: 1. Externally Aided Projects-Loan 31.3 34.4 42.7 1.5 1.5 1.7 11.0 9.9 24.2 2. Special Assistance as Loan to States for 109.6 125.0 150.0 5.3 5.5 5.9 34.9 14.1 20.0 Capital Expenditure 3. Special Assistance under the Demand - 11.7 18.0 10.0 0.6 0.8 0.4 408.5 53.9 -44.4 Transfers to States IV. Total Transfer to States [other than I+II+III] 571.3 604.5 717.0 27.7 26.6 28.0 0.8 5.8 18.6 1. Centrally Sponsored Schemes (Revenue) 425.3 392.7 514.4 20.6 17.3 20.1 4.8 -7.7 31.0 2. Central Sector Schemes 15.1 63.8 76.5 0.7 2.8 3.0 17.0 322.5 20.0 3. Other Categories of Expenditure 131.0 147.9 126.0 6.3 6.5 4.9 -11.6 12.9 -14.8 4. Capital Transfers 0.0 0.1 0.1 0.0 0.0 0.0 -50.0 10100.0 1.0 V. Transfer to Delhi, Puducherry, and 55.2 55.9 58.5 2.7 2.5 2.3 -1.8 1.3 4.5 Jammu and Kashmir VI. Gross Transfers to States/UTs (I+II+III+IV+V) 2,065 2,276 2,560 100.0 100.0 100.0 10.7 10.2 12.5 VII. Less Recovery of Loans and Advances 12.2 50.3 50.3 0.6 2.2 2.0 21.0 311.1 0.0 VIII. Net Transfers (VI-VII) 2,053 2,225 2,510 99.4 97.8 98.0 10.7 8.4 12.8 IX. Gross Transfers / GDP (per cent) 7.0 7.0 7.2 X. Net Transfers / GDP (per cent) 6.9 6.9 7.0 Source: Union budget documents. 82 RBI Bulletin February 2025Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE Quality of Public Expenditure increasingly recognised as a cornerstone of long-term development (Misra et al., 2021). Moreover, ensuring and its Socio-economic Impact optimal allocation of resources within these critical in India domains further reinforces the role of public spending in promoting inclusive and sustainable growth (Padhi by Rachit Solanki, Kovuri Akash Yadav, et al., 2023). Aayushi Khandelwal, Samir Ranjan Behera Public expenditure and its quality thus assume and Atri Mukherjee^ critical importance in balancing growth imperatives with the maintenance of macroeconomic stability. Prudent fiscal policy can create room for private In India, the post-liberalisation period has been spending, and when coupled with sustainable marked by dynamic shifts in fiscal priorities, balancing public outlays, they yield definite economic benefits the imperatives of macroeconomic stabilisation with (GoI, 2017). However, high public spending, even if investments in critical sectors such as infrastructure, growth-oriented, can pose significant risks. Sustained healthcare, and education. Against the backdrop high budgetary deficits can undermine national of capex push by the Centre and States, this article savings, elevate interest rates, and adversely affect examines India’s public expenditure trajectory from national income in both the short and long term. 1991-92 onwards, analysing the role of policy reforms, Persistent deficits erode government credibility and structural transformations, and policy initiatives. The investor confidence while exacerbating external study elucidates the interplay between expenditure composition, economic outcomes, and developmental vulnerabilities, such as current account deficits, progress by computing a quality of public expenditure stemming from prolonged fiscal imbalances (Gale and (QPE) index. Orzag, 2003). These dynamics highlight the need to continuously evaluate and refine the composition I. Introduction of public expenditure to ensure responsible fiscal Government spending and its structural management and sustainable growth. composition play an important role in shaping Against this backdrop of balancing fiscal prudence economic growth. Reorienting the spending profile with growth imperatives, an analysis of the composition toward investment, particularly by directing public of public spending assumes criticality. This article borrowings to finance capital formation, has positive examines the trajectory of public expenditure in impact on GDP (Sever et al, 2011). Public expenditure, India over the past three decades, focusing on the such as those that enhance essential public goods factors influencing its quality and composition. By – education, healthcare, and infrastructure – are exploring linkages of expenditure composition to generally more productive. These expenditures macroeconomic outcomes, the study offers insights can not only complement private investments but to optimise fiscal strategies. The article is organised also foster an enabling environment for sustainable into six sections: Section II explores the measures of economic growth. Targeted spending on strengthening composition of public expenditure; Section III provides social safety nets, promoting entrepreneurship, a phase-wise analysis of expenditure trends from 1991 and improving public expenditure management is to 2025; Section IV outlines the methodology used to ^ The authors are from the Department of Economic and Policy Research. construct an innovative quality of public expenditure The views expressed in this article are those of the authors and do not represent the views of the Reserve Bank of India. (QPE) index; Section V discusses the key findings; and RBI Bulletin February 2025 83ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India Section VI concludes by summarising key insights (Jain and Kumar, 2013; RBI, 2024). Aligning the and highlighting policy priorities for promoting composition of public expenditure with activities sustainable growth and fiscal stability. that generate positive externalities, augment capacity creation, and reinforce fiscal consolidation further II. Measuring Quality of Public Expenditure strengthens the synergy between fiscal and monetary The composition of public expenditure is policies (Goyal and Sharma, 2018). Key metrics, a critical indicator of its quality, reflecting how such as the share of capital outlay (CO) in GDP and effectively government spending fosters sustainable its proportion in total expenditure, capture the growth and development. Maintaining a balance government’s commitment to growth-oriented public between expenditure on final consumption and spending. on investments in both physical and human capital Furthermore, certain categories of public formation generates long-term benefits for present expenditure are intended to stimulate economic and future generations. A higher share of spending growth by enhancing the economy’s stock of devoted to capital formation thus indicates a strategic production factors (labour and capital) or by focus on long-term gains (Misra et al., 2021). Hence, improving their productivity. The most frequently understanding the balance between consumption- cited categories include education and training, based and investment-oriented outlays is essential for public infrastructure investments, R&D (which gauging the sustainability of the spending patterns of drives technological advancement and innovation), the government. and healthcare (which boosts both the size and Among the various metrics used to evaluate productivity of the labour force by extending the expenditure efficiency, the quantum of capital span of healthy life) [European Commission, 2002; spending by the government and the ratio of revenue 2004]. These outlays are captured as “development expenditure to capital outlay (RECO) have emerged spending” in Central and States’ expenditure budgets. as particularly significant. These measures provide In some contexts, subsidies - particularly those aimed insights into how public funds are allocated, enabling at improving nutrition, such as food subsidies - are also policymakers to assess the potential advantages considered part of development expenditure, as well- of prioritising capital expenditure over revenue targeted subsidies can address specific developmental expenditure. By emphasising capital outlays, bottlenecks like undernutrition and rural distress, governments can advance long-term economic growth thereby conferring longer-term welfare gains (Fan and development outcomes. An increase in capital and Brzeska, 2012). Higher developmental spending expenditure often yields a more than proportional by governments, owing to its positive impact on expansion in investment, thereby exerting a stronger human capital formation, can foster economic growth impact on overall economic performance. Public while simultaneously promoting equity and reducing investment, in particular, tends to “crowd in” private poverty (IMF, 1998). Development expenditure investment by spurring demand and expanding encompasses a broad spectrum of social and economic productive capacity (Bose and Bhanumurthy, 2015). services. On the social side, it includes spending on Moreover, the fiscal multiplier associated with health, water supply, housing, urban development, capital outlay not only surpasses that of revenue welfare of weaker sections, nutrition, and labour spending but remains higher for a longer duration, welfare. On the economic side, resources are allocated underscoring its robust growth-promoting potential to agriculture, rural development, irrigation, energy, 84 RBI Bulletin February 2025Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE industry, transport and communication, science, linking discernible shifts in the three key indicators technology, and environment. - capital outlay, development expenditure, and interest payments - to well-known events such as the However, scaling up allocations for capital 1991 economic crisis, the introduction of the FRBM formation and social sector development is often framework, the global financial crisis of 2008, the constrained by limits on revenue mobilisation subsequent stimulus measures, the rollout of GST in and borrowings. Consequently, governments need 2017, and the fiscal implications of pandemic post- to reconcile spending imperatives with financing 2020, the “quality of expenditure” has evolved over constraints. Persistent high deficits can accumulate more than three decades of India’s economic reform into higher public debt, which then elevates the and development (Charts 1, 2 and 3). interest burden in subsequent budgets. Hence, the share of interest payments in total expenditure Chart 1: Capital Outlay can serve as a useful indicator of the quality of past spending and the effectiveness of debt management. a. Centre A lower proportion of interest payments in total expenditure preserves scarce fiscal resources for capital and developmental needs. This ratio is also analysed as a key measure of spending quality. The following section applies this analytical framework to India’s historical expenditure data, offering a phase- wise perspective to better understand and evaluate the shifts in public spending over time. III. Public Expenditure in India during 1991-20251: A Phase-wise Analysis A historical examination of India’s public expenditure - encompassing both the Centre and the States from 1991–92 to 2024–25 reveals distinct phases shaped by significant macroeconomic shifts, policy reforms, and associated fiscal developments. Segmenting this period into intervals can provide a coherent framework for analysing broad trajectories and turning points. Accordingly, this section identifies six phases, illustrating how structural forces have shaped the quality of public expenditure at both levels of government. This periodisation, therefore, underscores the close interplay between macroeconomic cycles, policy reforms, and public expenditure patterns. By Source: DBIE, RBI; and State Finances: A Study of Budgets. RBI Bulletin February 2025 85 PDG fo tnec reP oitaR 4.5 15.0 EaP rh lya s Pe o I st- PP rh e-a Fs Re B I MI Ph Fa Rs Be M III P Gh Fa Cs ae nI dV StP rh ua cs te u rV al PP ah na ds ee m V iI c 14.0 4.0 Liberali- Consoli- Implemen-Counter- Reforms Shock 13.0 sation dation tation cyclical and and Reforms and Adjustm- GST Rollout Infrastr- 12.0 3.5 and Fiscal Growth ents ucture- Realign- Upswing Focused 11.0 3.0 ments Recovery 10.0 9.0 2.5 8.0 7.0 2.0 6.0 5.0 1.5 4.0 1.0 3.0 Capital Outlay (Per cent of GDP) (LHS) Revenue Expenditure to Capital Outlay Ratio (RHS) b. States PDG fo tnec reP oitaR 3.0 10.5 2.8 9.5 2.6 2.4 8.5 2.2 2.0 7.5 1.8 6.5 1.6 1.4 5.5 1.2 1.0 4.5 Capital Outlay (Per cent of GDP) (LHS) Revenue Expenditure to Capital Outlay Ratio (RHS) 29-1991 29-1991 39-2991 39-2991 49-3991 49-3991 59-4991 59-4991 6 8 9 0 1 2 3 4 5 6 8 97 79 9 9 0 0 0 0 0 0 0 0 09 0- - - - - - - - - - - -- -5 7 8 9 0 1 2 3 4 5 7 86 69 9 9 9 0 0 0 0 0 0 0 09 09 9 9 9 0 0 0 0 0 0 0 09 01 1 1 1 2 2 2 2 2 2 2 21 2 6 8 9 0 1 2 3 4 5 6 87 79 9 9 0 0 0 0 0 0 0 09 0- - - - - - - - - - -- -5 7 8 9 0 1 2 3 4 5 76 69 9 9 9 0 0 0 0 0 0 09 09 9 9 9 0 0 0 0 0 0 09 01 1 1 1 2 2 2 2 2 2 21 2 01-9002 90-8002 11-0102 01-9002 21-1102 11-0102 31-2102 21-1102 41-3102 31-2102 51-4102 41-3102 61-5102 51-4102 71-6102 61-5102 81-7102 71-6102 91-8102 81-7102 02-9102 91-8102 12-0202 02-9102 22-1202 12-0202 32-2202 22-1202 42-3202 32-2202 52-4202 42-3202 52-4202 1 Data pertaining to the Centre and States for 2023-24 and 2024-25 are revised estimates (RE) and budget estimates (BE), respectively.ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India Chart 2: Development Expenditure a. Centre Development Expenditure (Per cent of GDP) (LHS) Development Expenditure to Non-development Expenditure Ratio (RHS) Source: DBIE, RBI; and State Finances: A Study of Budgets. The analysis indicates that the Centre’s capital tax devolution). Development expenditure, for both outlay experienced notable troughs in the late 1990s Centre and States, after initially declining in the and around the global financial crisis but underwent 1990s, has gradually stabilised or increased over time, a significant boost in the mid-2000s and again in influenced by both policy priorities and macro-fiscal the post-COVID period. State-level capital outlay environment. Interest payments, initially high due has generally trended upward over the long run, to the debt burdens of the 1980s and early 1990s, reflecting the growing imperative for States to invest gradually eased for both Centre and States during in infrastructure and public goods complimented by periods of sustained growth and fiscal consolidation, improved revenue flows (especially following higher although the Centre’s interest payments remain 86 RBI Bulletin February 2025 PDG fo tnec reP oitaR 12.0 1.8 Phase I Phase II Phase III Phase IV Phase V Phase VI 11.5 Early Pre-FRBM FRBM Global Structural Pandemic 11.0 P ao ls it s- aL ti ib oe nr- Co an ts io ol nid- I tm atp iole nm ae nn d- CF rin isa isn aci na dl aR nef do Grm STs S Ih no frc ak s a trn -d 1.6 10.5 Reforms Growth Counter- Rollout ucture- 10.0 and Upswing cyclical Focused 9.5 RF eais lc iga nl - A md eju ns tt s- Recovery 1.4 9.0 ments 8.5 1.2 8.0 7.5 1.0 7.0 6.5 6.0 0.8 5.5 5.0 0.6 b. States Development Expenditure (Per cent of GDP) (LHS) Development Expenditure to Non-development Expenditure Ratio (RHS) PDG fo tnec reP oitaR 12.5 2.7 2.6 12.0 2.5 2.4 11.5 2.3 11.0 2.2 2.1 10.5 2.0 1.9 10.0 1.8 1.7 9.5 1.6 9.0 1.5 1.4 8.5 1.3 29-1991 29-1991 39-2991 39-2991 49-3991 49-3991 59-4991 59-4991 69-5991 69-5991 79-6991 79-6991 89-7991 89-7991 99-8991 99-8991 00-9991 00-9991 10-0002 10-0002 20-1002 20-1002 30-2002 30-2002 40-3002 40-3002 50-4002 50-4002 60-5002 60-5002 70-6002 70-6002 80-7002 80-7002 90-8002 90-8002 01-9002 01-9002 11-0102 11-0102 21-1102 21-1102 31-2102 31-2102 4 5 6 8 9 071 1 1 1 1 21- - - - - --3 4 5 7 8 961 1 1 1 1 110 0 0 0 0 002 2 2 2 2 22 4 5 6 8 971 1 1 1 11- - - - --3 4 5 7 861 1 1 1 110 0 0 0 002 2 2 2 22 12-0202 02-9102 22-1202 12-0202 32-2202 22-1202 42-3202 32-2202 52-4202 42-3202 52-4202 Chart 3: Interest Payment a. Centre Source: DBIE, RBI; and State Finances: A Study of Budgets. PDG fo tnec reP tnec reP 5.5 35.0 5.0 Ph IF ma Rs pBe lM e I - II FP iGh nla aos nbe ca iI l aV l S RtP r eh u fa ocs t re u m rV sa l SPP hah ona cds kee am V niI dc 333 234 ... 000 mentationCrisis and and Infrastru- 31.0 and Counter- GST cture - 30.0 4.5 Growth cyclical Rollout Focused 29.0 Upswing Adjust- Recovery 28.0 ments 27.0 Phase II 26.0 4.0 Pre - FRBM 25.0 Consolida- 24.0 tion 23.0 3.5 22.0 21.0 20.0 3.0 19.0 Interest Payment (Per cent of GDP) (LHS) Interest Payment (Per cent of Total Expenditure) (RHS) b. States PDG fo tnec reP tnec reP 3.0 19.0 2.8 18.0 17.0 2.6 16.0 2.4 15.0 2.2 14.0 2.0 13.0 12.0 1.8 11.0 1.6 10.0 1.4 9.0 Interest Payment (Per cent of GDP) (LHS) Interest Payment (Per cent of Total Expenditure) (RHS) 29-1991 29-1991 39-2991 39-2991 49-3991 49-3991 59-4991 59-4991 69-5991 69-5991 79-6991 79-6991 89-7991 89-7991 99-8991 99-8991 00-9991 00-9991 10-0002 10-0002 20-1002 20-1002 30-2002 30-2002 40-3002 40-3002 50-4002 50-4002 60-5002 60-5002 70-6002 70-6002 80-7002 80-7002 90-8002 90-8002 01-9002 01-9002 11-0102 11-0102 21-1102 21-1102 31-2102 31-2102 41-3102 41-3102 51-4102 51-4102 61-5102 61-5102 71-6102 71-6102 81-7102 81-7102 91-8102 91-8102 02-9102 02-9102 12-0202 12-0202 22-1202 22-1202 32-2202 32-2202 42-3202 42-3202 52-4202 52-4202 Phase I Early Post-Liber- alisation Reforms and Fiscal Realign- mentsQuality of Public Expenditure and its Socio-economic Impact in India ARTICLE structurally more significant than those of the States, Phase II (1996-97 to 2002-03): Pre-FRBM Consolidation especially relative to total expenditure. With this During this period, governments grappled with backdrop, the key features of each phase are analysed rising wage bills - spurred by the Fifth Pay Commission in greater detail. award at the Centre and parallel revisions in several Phase I (1991-92 to 1995-96): Early Post-Liberalisation States - against a backdrop of sluggish revenue growth. Reforms and Fiscal Realignments These pressures constrained the capacity to invest in longer-term priorities, reflected in persistently low This phase coincided with India’s transition capital outlays at both levels. Although the Centre’s from the balance-of-payments crisis to a liberalised capital spending occasionally inched above 1 per cent economic framework. The Centre dismantled of GDP, the RECO ratio regularly exceeded 10, on industrial licensing, relaxed import controls, and account of higher expenditures on salaries, subsidies, promoted greater global integration. While these interest, and administrative expenses overshadowing measures boosted economic stabilisation, pressure development outlays. States, too, found it increasingly on public finances remained. difficult to protect capital spending. Centre’s capital outlay declined from 1.7 per Furthermore, interest payments assumed a cent of GDP in 1991-92 to 1.2 per cent in 1995–96. larger slice of total spending, highlighting structural Meanwhile, the revenue expenditure-to-capital imbalances in public debt management. For the outlay (RECO) ratio rose from 7.5 to 9.9, indicating Centre, interest constituted close to or above 30 per increased current spending relative to capital cent of total expenditure in certain years, while for investments. Similarly, development expenditure many States, this share jumped from being slightly (DE) fell by 2.0 per cent of GDP, amidst efforts above 10 per cent to nearly one-fifth by the end on controlling discretionary outlays during the of the phase. This intensified the crowding out of stabilisation process. Despite these spending curbs, governments’ development expenditures, with the interest payments (IP) remained high, at around ratio of development to non-development spending 4.0 - 4.2 per cent of GDP, with their share in total falling further. This environment of heavy debt- expenditure climbing from 23.9 per cent to 28.1 per servicing costs and limited fiscal space prompted cent. renewed debates on institutional mechanisms for consolidation, culminating in the introduction of State finances exhibited similar pattern, the Fiscal Responsibility and Budget Management though with some variation. Capital outlay hovered (FRBM) Bill in 2000. Although formal enactment around 1.5 per cent of GDP, supported by a modest occurred in 2003, the legislative groundwork laid improvement in the RECO ratio, which declined during this phase signalled a growing recognition of slightly from 8.5 to 7.8. Nonetheless, development the need for rules-based fiscal discipline. expenditure dropped from 11.3 to 9.4 per cent of Phase III (2003-04 to 2007-08): FRBM Implementation GDP; transfers from the Centre fell during this period. and Growth Upswing Interest payments also trended upward, rising as a share of total expenditure from 10.7 to 12.7 per cent, This phase marked a turning point in India’s reflecting accumulating debt-servicing obligations fiscal landscape, driven by the implementation of and signalling a gradual stress in State-level fiscal the FRBM Act of 2003 at the Centre and the adoption positions during the early post-reform years. of similar fiscal responsibility legislations (FRLs) by RBI Bulletin February 2025 87ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India most States. These reforms coincided with a period These improvements, supported by fiscal reforms of robust GDP growth, spurred by global economic and high economic growth, created the fiscal room expansion, growing trade integration, and the private necessary for expanded public investment and higher sector’s rising dynamism. The resulting revenue spending quality at both levels of government. buoyancy enabled both the Centre and the States to Phase IV (2008-09 to 2012-13): Global Financial Crisis strengthen public investment, improve expenditure and Countercyclical Adjustments composition, and reduce debt-related burdens. The onset of the global financial crisis (GFC) At the Centre, fiscal responsibility reforms prompted India, like other countries, to recalibrate facilitated a structural rebalancing of expenditure its fiscal priorities, balancing countercyclical stimulus priorities. Capital outlay almost doubled, rising from with medium-term consolidation goals. Although 1.2 per cent of GDP in 2003-04 to 2.2 per cent in 2007- domestic banks and markets were relatively insulated 08 supporting critical infrastructure development and compared to advanced economies, a contraction in long-term growth-enabling projects. The RECO ratio fell global demand and credit flows created a short-lived sharply from 10.6 to 5.6 during this period, reflecting growth slowdown. The Centre introduced stimulus enhanced fiscal space for productive investment. measures - primarily tax reductions and targeted Development expenditure, while steady at 6-7 per spending - to shore up domestic consumption, sustain cent of GDP, saw qualitative improvements, with a investment in critical sectors, and mitigate spillovers greater focus on social and economic infrastructure. from external shocks. These policy choices widened Additionally, the Centre’s interest payment burden fiscal deficits and temporarily tilted expenditure eased, declining from 4.4 per cent of GDP in 2003- profiles toward support measures. Centre’s capital 04 to 3.5 per cent in 2007-08, and its share in total outlay initially dipped below its pre-crisis level and expenditure fell from 26.3 per cent to 24.0 per cent, recovered only gradually. Meanwhile, development indicating improved debt management. expenditure absorbed a growing share of resources, enabling social and sectoral initiatives but also placing States fiscal consolidation and revenue buoyancy pressure on overall fiscal space. Although interest were bolstered by improved tax devolution and grants, payments, as a share of GDP, declined marginally following the recommendations of the 12th Finance relative to the pre-crisis trajectory - partly owing to Commission. Capital spending increased significantly, gains from earlier debt management reforms - this with capital outlay rising from 1.9 per cent to 2.5 per reduction did not substantially alter the share of cent of GDP, underscoring States’ ability to support interest payments in total expenditure, which settled infrastructure development despite fiscal constraints. around the low twenties. The RECO ratio improved steadily, reflecting better budgetary management and expenditure efficiency. States also deployed countercyclical strategies Development expenditure, averaging around 9.5 per - such as scaled-up welfare programmes - while cent of GDP, showed resilience and modest growth contending with revenue shortfalls. Capital outlay in several States, driven by increased allocations moderated from its pre-crisis peak. Nonetheless, toward education, health, and rural development. the subnational shift toward greater revenue Furthermore, interest payments as a share of GDP spending did not derail ongoing fiscal reforms. Debt declined, while their proportion in total expenditure restructuring initiatives and the institutionalisation fell from 17.9 per cent to 13.6 per cent. of FRBM-like frameworks in many States helped 88 RBI Bulletin February 2025Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE temper interest payments, freeing some fiscal space prudent borrowing practices and relatively stable debt for social programmes. Consequently, even though profiles. public investment plans did not fully recover to pre- Phase VI (2020-21 to 2024-25): Pandemic Shock and crisis levels, the emphasis on coordinated stimulus Infrastructure-Focused Recovery measures and prudent debt management enabled This period encompasses the profound economic States to contain the long-term erosion of their fiscal disruptions triggered by the COVID-19 pandemic and health. the subsequent shift toward infrastructure-led revival. Phase V (2013-14 to 2019-20): Structural Reforms and The Centre responded to the crisis with large-scale GST Rollout fiscal interventions - direct cash transfers, emergency health allocations, liquidity measures for stressed During this period, India navigated a series of sectors - while pivoting toward higher capital outlays transformative policy initiatives - including the 14th to stimulate growth. This policy choice is reflected Finance Commission’s significant hike in devolution in the rising share of capital outlay in GDP (from 1.6 (from 32 per cent to 42 per cent of divisible pool), and per cent in 2020-21 to 2.8 per cent by 2024-25 (BE)) the rollout of the goods and services tax (GST) in 2017. and the concurrent fall in the RECO ratio. It may be These reforms aimed to strengthen fiscal federalism, noted that the Centre’s effective capital expenditure streamline indirect taxation, and reinforce financial (i.e., including outlays on grants-in-aid for creation transparency. However, in the interim, there were of capital assets) was placed higher at 4.6 per cent of some transitional uncertainties, particularly for States GDP in 2024-25 (BE). Fiscal composition has, thus, adapting to new revenue-sharing arrangements and became more investment-focused, aiming to harness compensation frameworks. infrastructure’s multiplier effects on employment At the Central level, capital outlay generally and industrial revival. Although pandemic-related stayed between 1.3 and 1.6 per cent of GDP, reflecting borrowing increased, higher debt-servicing costs a measured commitment to infrastructure and asset remained manageable. creation. Despite incremental improvements in the At the State level, expanded borrowing limits RECO ratio, the Centre’s development expenditure and revenue shortfalls shaped fiscal decisions. Many drifted lower, as transfers to States rose. While interest States channelled additional resources into healthcare, payments hovered around 3.0 to 3.3 per cent of GDP, social protection, and capital works, effectively they continued to absorb a sizeable portion of total bolstering both pandemic mitigation and medium- expenditure, constraining the space for developmental term developmental objectives. As a result, State-level outlays. The divergence in development expenditure capital expenditure grew, reducing the RECO ratio and between the Centre and the States widened, driven by sustaining developmental outlays in sectors essential shifts in resource allocation following the 14th Finance for recovery. Despite accumulating debt stocks, most Commission’s recommendations. States with higher States maintained stable interest burdens, reflecting devolved funds prioritised social sector expenditure prudent debt management practices and the relatively and capital outlay. The additional devolved resources, benign interest-rate environment. Overall, this alongside a policy focus on core infrastructure and period underscores a strategic shift toward targeted social programs, helped maintain development infrastructure investments as a cornerstone of fiscal expenditure near 10 to 12 per cent of GDP. Interest policy, supported by carefully balanced borrowing payments remained largely contained, suggesting strategies at both Central and State levels. RBI Bulletin February 2025 89ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India The preceding analysis provides insights into from elevated interest payments or from a reduced the evolving nature of public spending in India. total expenditure base (or both). In either scenario, However, the multiplicity of indicators and their a higher IPTE reflects diminished fiscal headroom varied trajectories makes it challenging to gauge the for capital and developmental spending. To ensure effectiveness of public resources in fostering long- comparability across years and variables, the data have term growth and stability. Composite indices are been standardised using a z-score transformation: frequently used to combine and summarize multiple, x – z it interlinked factors into a single, streamlined measure, it σ i i µ facilitating meaningful comparisons and trend where z is the standard=is ed value of variable i in year it assessments across various periods (Chen et al, 2021). t, and σ are the mean and standard deviation of i By unifying these indicators into a single quantitative variiable i. µ benchmark, such an index can offer a clear, objective To aggregate these variables into a single measure framework to track shifts over time (Badullahewage of expenditure quality, a dynamic factor model & Attygalle, 2021). The following sections outline the (DFM) was employed. DFMs are particularly suited construction of a quality of public expenditure (QPE) for combining multiple observed variables into a index and analyse its performance, shedding light single latent factor that captures the underlying on how effectively it captures the multidimensional dynamics of expenditure quality. They assume that nature of the quality of public spending. a small number of unobserved factors can explain IV. Quality of Public Expenditure Index: Data and the common patterns in a large set of observed time Methodology series (Stock and Watson, 2016). In this study, the composite index derived from the DFM provides a Annual fiscal data from 1991- 92 to 2022 - 23 has way to measure and track the overall quality of public been used to construct and analyse the quality of public spending. The model reduces the complexity of expenditure (QPE) index for both Centre and States. multivariate time series by expressing the observed The dataset encompasses key variables that represent variables as linear combinations of external variables the quality of public spending. The data are sourced and hidden factors. Mathematically, the DFM extracts from the Reserve Bank’s database on Indian economy a latent factor ( ) capturing shared trends across the (DBIE) and the e-States database published alongside the Reserve Bank’s annual publication “State Finances: standardised vari𝑡ables: 𝑓 A Study of Budgets”. The variables include (i) capital y λ f ϵ t i t t outlay to GDP (COGDP) ratio, (ii) revenue expenditure f = f + µ t i t t to capital outlay (RECO) ratio, (iii) development –1 expenditure to GDP (DEGDP) ratio, (iv) development Where y t is a vector= Øof in+d icators of quality of expenditure to total expenditure (DETE) ratio, and (v) expenditure, λ and are parameters and ϵ and μ i i t t interest payments to total expenditure (IPTE) ratio. As are error terms. These hidden factors follow a vector Ø lower RECO and a lower interest payment share are autoregressive process. Following Stock and Watson both desirable, the inverse of RECO ratio and the ratio (1989, 1991), the parameters of DFMs are estimated of non-interest payments in total expenditure are used using the Kalman filter, to derive and implement when constructing the index. The inverse of RECO the log likelihood approach. Separate indices were captures the lingering impact of past borrowings on constructed for Centre and the States, employing the current fiscal space. A high IPTE ratio may result either same methodology to maintain consistency. 90 RBI Bulletin February 2025Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE The estimated factor loadings (Annex Table 1) major States2 are considered during the period 2001- highlight the association of different expenditure 02 to 2022-23. Apart from the quality of expenditure components with the underlying quality of public index, the main regression equation includes per expenditure. Notably, capital and development capita income and share of agriculture in Gross State spending exhibit significant loadings, reflecting Domestic Product (GSDP) are taken as control variables their central role in shaping expenditure patterns. as structure of the economy and income levels of the The persistence of the latent factor indicates a States are expected to impact the social outcomes. stable underlying structure in expenditure quality, y α βQPE β Per capita income β Agriculture it it it reinforcing the consistency of the index over time. share 1 2 3 = it+ it + + Regression model Where+ yµ is human development index of health or it In addition to the index at both Central and education for State ‘i’ at time ‘t’, QPE is the index of it overall States’ level, the index is also computed for quality of public expenditure for State ‘i’ at time ‘t’, individual States to assess its relationship with the Per capita income and Agriculture share capture the it it outcome variables. Human development index (HDI) income levels and structure of the States’ economy, on education and health, at the sub-national level, respectively, for State ‘i’ at time ‘t’. β refers to available from the Global Data Lab, are considered regression coefficients and refers to the e rror term. it as outcome variables. Two regression equations V. Empirical Findings µ are separately estimated for HDI health index and QPE Index Trends for Centre and States HDI education index. Fixed Effects model in panel framework is used to estimate regression equations. The evolution of the QPE index aligns with the Due to data availability and consistency, data for 16 historical patterns of the variables discussed in the Chart 4: Quality of Public Expenditure Index for Centre Sources: RBI staff estimates. 2 Assam, Bihar, Chhattisgarh, Gujarat, Haryana, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, and West Bengal. RBI Bulletin February 2025 91 xednI EPQ 3.0 2.0 1.0 0.0 -1.0 -2.0 -3.0 29-1991 39-2991 49-3991 59-4991 69-5991 79-6991 89-7991 99-8991 00-9991 10-0002 20-1002 30-2002 40-3002 50-4002 60-5002 70-6002 80-7002 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 52-4202ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India Chart 5: Quality of Public Expenditure Index for States Sources: RBI staff estimates. earlier section. During the initial phase, the Centre’s temporarily raised deficits. In subsequent years, index (Chart 4) showed a slight improvement, while consolidation efforts moderated the indices. For the States’ index (Chart 5) declined modestly, amidst States, capital outlay eased from its pre-crisis peak, fiscal pressures faced by both levels of government. although rising revenue expenditure - particularly Public investment fell as fiscal consolidation due to subsidies - remained a concern. took precedence. In the subsequent phase, both The next phase witnessed an improvement in the indices experienced a sharp decline, reflecting States’ index, driven by the 14th Finance Commission’s the combined impact of the Fifth Pay Commission recommendations, which significantly increased implementation, rising interest payments, and the resource devolution to States. This augmented persistent dominance of revenue expenditure over development expenditure at the State level but led capital outlay. to a concurrent decline in the Centre’s expenditure share. During this period, the introduction of the Fiscal responsibility reforms and economic goods and services tax (GST) in 2017 fundamentally growth in the years leading up to the 2008 global altered the revenue-sharing framework. While financial crisis significantly improved both indices these developments initially benefited States, the during the third phase. States benefited from Centre faced growing fiscal challenges from revenue greater fiscal devolution and increased tax buoyancy, shortfalls and subsidy pressures. leading to better fiscal outcomes. This phase reflects the advantages of fiscal prudence and economic The COVID-19 pandemic triggered buoyancy. However, the 2008 global financial crisis unprecedented fiscal stimulus measures, leading prompted the Centre to adopt countercyclical fiscal initially to wider deficits. However, the subsequent measures, including stimulus packages, which recovery was supported by a renewed emphasis 92 RBI Bulletin February 2025 xednI EPQ 5.0 4.0 3.0 2.0 1.0 0.0 -1.0 -2.0 -3.0 -4.0 -5.0 29-1991 39-2991 49-3991 59-4991 69-5991 79-6991 89-7991 99-8991 00-9991 10-0002 20-1002 30-2002 40-3002 50-4002 60-5002 70-6002 80-7002 90-8002 01-9002 11-0102 21-1102 31-2102 41-3102 51-4102 61-5102 71-6102 81-7102 91-8102 02-9102 12-0202 22-1202 32-2202 42-3202 52-4202Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE on public investment and a heightened focus on expenditure. The positive correlation between the capital expenditure in Union Budgets from 2021-22 QPE index and key outcome indicators underscores onwards. States demonstrated resilience, especially the crucial link between quality of public expenditure post-2010, aided by increased devolution and the and holistic macroeconomic and developmental introduction of GST. Major reforms - such as the Fiscal progress. Responsibility and Budget Management (FRBM) Act As States’ QPE index has a stronger relationship and GST - have played pivotal roles in shaping fiscal with HDI, a State-wise index of quality of public outcomes, highlighting the importance of structural expenditure is computed to check the relationship measures for sustainable public finances. with education and health as outcome variables. As QPE Index and Human Development Outcomes HDI index comprises of three sub-indices of health, education and income, we use education and health The QPE index shows a positive association with indices to measure State-level outcome variables. stronger economic and developmental outcomes. The relationship between State-wise QPE index and Periods of a rising QPE index for both the Centre outcome indicators (health and education indices) is and States overlap with eras of higher GDP growth positive (Chart 7). and improved performance of human development index (HDI) (Charts 6a and 6b). Moreover, States To empirically establish the relationship, two exhibit a closer alignment between their QPE index separate regression models are estimated each for and improvements in HDI, indicating an effective education and health indices. All the variables are allocation of resources toward development taken in logarithmic form except share of agriculture Chart 6: Association of QPE Index with GDP Growth and HDI Index a. QPE Index and Real GDP Growth b. QPE Index and HDI Source: RBI staff estimates. RBI Bulletin February 2025 93 )tnec rep( htworG PDG laeR xednI IDH 11.0 0.65 10.0 0.60 9.0 8.0 0.55 7.0 6.0 0.50 5.0 4.0 0.45 3.0 2.0 0.40 -6.0 -4.0 -2.0 0.0 2.0 4.0 -6.0 -4.0 -2.0 0.0 2.0 4.0 QPE Index QPE Index Centre States Centre StatesARTICLE Quality of Public Expenditure and its Socio-economic Impact in India Chart 7: QPE Index of States and HDI Health and Education Indices a. Education Index b. Health Index Source: RBI staff estimates. in GSDP. Two control variables have been considered (Table 1). in the regressions - per capita income and the VI. Conclusion share of agriculture in GSDP, capturing the level The analysis undertaken in this study aimed of economic development and the structure of a to evaluate the trajectory and quality of public State’s economy, respectively. Controlling for these expenditure in India since 1991-92, with a focus on two variables, we find that that the quality of understanding how policy reforms, macroeconomic expenditure index has a positive effect on outcome shifts, and crisis responses influenced expenditure indicators (proxied by health and education index) composition and its implications for growth, fiscal stability, and developmental outcomes. By constructing Table 1: Regression results a quality of public expenditure (QPE) index, the study attempted an assessment of expenditure Variables Education index Health index efficiency, capturing the interplay between capital QPE (log) 0.01* 0.01* (0.00) (0.00) outlay, revenue expenditure, development spending, Per capita GSDP (log) 0.09* 0.02* and debt-servicing burdens across distinct phases of (0.01) (0.00) India’s fiscal evolution. Share of Agriculture -0.003* -0.00* (0.00) (0.00) The analysis reveals that India’s expenditure Constant -1.28* -0.42* composition has undergone significant (0.07) (0.05) transformations, shaped by structural reforms and Observations 336 336 external shocks. The post-liberalisation phase (1991- Note: (i) Standard errors are given in parentheses. (ii) * indicate significance of the regression coefficient at one per 95) witnessed fiscal consolidation at the cost of capital cent level. and developmental spending, while the pre-FRBM Source: RBI staff estimates. 94 RBI Bulletin February 2025 xednI noitacudE xednI htlaeH 0.8 0.90 0.7 0.85 0.6 0.80 0.5 0.75 0.4 0.70 0.3 0.65 0.2 0.60 -6 -5 -4 -3 -2 -1 0 1 2 3 4 5 -6 -5 -4 -3 -2 -1 0 1 2 3 4 QPEIndex QPEIndexQuality of Public Expenditure and its Socio-economic Impact in India ARTICLE years (1996-2003) were marked by rising debt burdens Bose, S., & Bhanumurthy, N. R. (2015). “Fiscal and stagnant public investment. The implementation multipliers for India”. Margin: The Journal of Applied of fiscal responsibility frameworks (2003-08) Economic Research, 9(4), 379-401. coincided with higher capital outlays, improved Chen, R., Ji, Y., Jiang, G., Xiao, H., Xie, R., and Zhu, RECO ratios, and reduced interest payments, P. (2021). “Composite Index Construction with Expert underscoring the benefits of rules-based discipline. Opinion”. Journal of Business & Economic Statistics, Subsequent phases highlighted the challenges of balancing countercyclical measures during the 41(1), 67–79. https://doi.org/10.1080/07350015.2021.2 global financial crisis (2008-13) and the transitional 000418. impacts of GST and enhanced fiscal devolution European Commission (2002). “Public finances in (2013-20). The pandemic-induced phase (2020–25) EMU — 2002”. European Economy No. 3/2002. demonstrated a strategic pivot toward infrastructure- led recovery, with both Centre and States prioritising European Commission (2004), “Public finances in capital expenditure to stimulate growth despite EMU – 2004, Part IV: Quality of public finances: what elevated borrowing. The QPE index underscores a role within the EU framework for economic policy positive correlation between expenditure quality coordination?”, European Economy No. 3/2004, pp. and socio-economic outcomes. Periods of higher QPE 179-217. align with stronger GDP growth and improvements Gale, W. G., & Orszag, P. R. (2003). “Economic effects in the human development index. However, the of sustained budget deficits”. National Tax Journal. external shocks temporarily reversed gains, while 56(3), 463-485. subsidy pressures and interest burdens constrained fiscal space. Additionally, quality of expenditure GoI (2017) “FRBM Review Committee Report”. at individual State level has a positive impact on Goyal, A., & Sharma, B. (2018). “Government education and health outcomes. expenditure in India: Composition and multipliers”. To sum up, the study reaffirms that prudent Journal of Quantitative Economics, 16, 47-85. expenditure composition - prioritising capital formation and developmental outlays - remains Fan, S., and Brzeska, J. (2016). “Sustainable food pivotal for sustaining growth and equity. The security and nutrition: Demystifying conventional recent emphasis on infrastructure investment beliefs”. Global Food Security, Volume 11. and fiscal discipline has bolstered resilience, and IMF (1998). “Public Spending on Human Development” achieving long-term sustainability necessitates by Sanjeev Gupta, Benedict Clements, and Erwin balancing immediate spending needs with strategic Tiongson. Finance and Development, Number 3, investments. Institutional reforms, such as the Volume 35, September. FRBM Act and GST, have proven instrumental in strengthening fiscal outcomes. Jain, R. and Kumar, P. (2013). “Size of Government References Expenditure Multipliers in India: A Structural VAR Analysis”, RBI Working Paper 07 / 2013, September. Badullahewage, P., and Attygalle, D. (2021). “Modelling a Multilevel Data Structure Using a Misra, S., Behera, S. R., Seth, B. & Sood, S. (2021), “Fiscal Composite Index”. American Journal of Applied Framework and Quality of Expenditure in India”, RBI Mathematics and Statistics, 9(3), 75-82. Bulletin, June. RBI Bulletin February 2025 95ARTICLE Quality of Public Expenditure and its Socio-economic Impact in India Padhi, I., Mishra, R., Behera S. R. and Rath, D. P. (2023). Stock, J. H., & Watson, M. W. (1989), “New Indexes of “Quality of Public Expenditure and Economic Growth: Coincident and Leading Economic Indicators”, NBER An Empirical Assessment at Sub-National Level”. RBI Macroeconomics Annual, 4: 351-394. Bulletin, July. Stock, J. H., and M. W. Watson. (1991), “A Probability Rath, D. P., Seth. B., Behera, S. R., and Suresh, A. K. Model of the Coincident Economic Indicators”. In (2023). “Capital Outlay of Indian States: An Empirical Leading Economic Indicators: New Approaches and Assessment of its Role and Determinants”. RBI Forecasting Records, ed. K. Lahiri and G. H. Moore, Bulletin, April. 63–89. Cambridge: Cambridge University Press. RBI (2024). “State Finances: A Study of Budgets of Stock, J. H., & Watson, M. W. (2016), “Dynamic Factor 2024-25”. Models, Factor-augmented Vector Autoregressions, Sever, I., Drezgic S. & Blazic, H. (2011). “Budget and Structural Vector Autoregressions in Spending and Economic Growth in Croatia – Dynamics Macroeconomics”, In Handbook of Macroeconomics and Relationships Over the Past Two Decades”. (Vol. 2, pp. 415-525). Elsevier. Zbornikradova Ekonomskog fakulteta u Rijeci: časopis zaekonomsku teoriju i praksu, Vol. 9(2): 291–331. 96 RBI Bulletin February 2025Quality of Public Expenditure and its Socio-economic Impact in India ARTICLE Annex Table 1: Factor Loadings for QPE Index for Centre and States Factor Loading Variable Centre States Capital Outlay-to-GDP Ratio 0.28 0.25 Inverse of Revenue Expenditure-to-Capital Outlay Ratio 0.27 0.26 Development Expenditure-to-GDP Ratio 0.33 0.26 Development Expenditure-to-Non-Development Expenditure Ratio 0.44 0.23 Non-interest Payment Expenditure-to-Total Expenditure Ratio 0.47 0.34 Note: All factor loadings are statistically significant at one per cent level. Source: RBI staff estimates. RBI Bulletin February 2025 97Dynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Dynamics of Agriculture Supply could enhance market efficiency by improving trust among stakeholders (EU, 2024; GoI, 2025). The Chain: Insights from Pan India agriculture supply chain involves several actors, viz., Survey during Rabi Marketing farmers, aggregators, traders, commission agents, processors, wholesalers and retailers that play their Season due role in delivering the final agri-commodity to the consumer. An efficient agriculture supply chain by Rajib Das, Rishabh Kumar, maintains transparency in the price formation Monika Sethi, Love Kumar Shandilya and mechanism with information available regarding Alice Sebastian^ cost structures, margins, and value additions across the supply chain. Various countries have taken steps This study examines the dynamics of retail food to improve the efficiency of agricultural supply price formation for major rabi crops based on a pan- chain, such as the European Union’s (EU’s) initiative India survey covering farmers, traders, and retailers. on the EU Agri-food Chain Observatory (AFCO) to Farmers’ share in consumer prices is estimated in the strengthen farmers’ position in the food supply range of 40 to 67 per cent across the select crops, with the chain and build trust among all stakeholders. A highest share realised by wheat producers. The retailers’ number of schemes such as the National Agriculture markups are generally observed to be higher than those of Market (eNAM), the formation of Farmer Producer the traders. While cash transactions dominate payments Organizations (FPOs), Agriculture Infrastructure in the agriculture supply chain, electronic payments Funds, Agricultural Marketing Infrastructure registered a significant increase compared to previous scheme, Integrated Cold Chain, Food Processing, and similar surveys. Empirical analysis suggests that policy Preservation Infrastructure scheme, Comprehensive interventions, such as enhanced market infrastructure, Programme for Vegetables & Fruits have been and expanded cold storage capacity, to reduce supply introduced by the government of India in the recent chain inefficiencies and post-harvest losses, may benefit years to improve the agriculture supply chain (details farmers and consumers. at Annex 1). Introduction In this context, the Reserve Bank of India had Food prices remain an important driver of overall conducted pan-India surveys to explore agriculture inflation in several economies, especially emerging supply chain dynamics in 2018 and 2022 for major and developing economies. At the same time, the kharif crops. These surveys were aimed at assessing paucity of adequate data across various segments the price formation process at the retail level in of the supply chain limits the understanding of major kharif crops by estimating the farmers’ share dynamics of price formation - a crucial input in in consumer prices and capturing the perception of developing appropriate policy interventions. Access the participants across the supply chain regarding to granular information about the supply chain various challenges and efficacy of the policy measures. ^ The authors are from the Department of Economic and Policy Research This study expands the coverage to major rabi crops, (DEPR), Reserve Bank of India (RBI). The authors are thankful to Dr. D. viz. wheat, gram, lentil, and mustard. These crops, Suganthi; the officers from Regional Economy Monitoring Division and DEPR Regional Offices for their inputs and assistance in conducting the exclusively grown in rabi season, account for around pan-India survey. The views expressed in the article are those of the authors and do not represent the views of the RBI. 5 per cent of the CPI basket and 11 per cent of CPI RBI Bulletin February 2025 99ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season food basket. To the extent possible, a comparison of inflation and volatility, these challenges have also findings with the previous surveys of 2018 (Bhoi et attracted a series of domestic and trade-related policy al., 2022) and (Suganthi et al., 2024) has also been interventions. Analysing the behaviour of market made1,2. intermediaries in fixing their markups can help to strengthen assessment and outlook of inflation The rest of the article is organised into four dynamics. sections. Section II provides stylised facts on the significance of rabi crops and changing margins. In line with the previous Kharif surveys of 2022 Section III describes the survey methodology and and 2018, the trends in price dispersion between retail coverage. Section IV presents the key survey findings and mandi prices5 have been examined by calculating and empirical analysis, and Section V provides margins using secondary data. Margin, as per cent of concluding observations. retail prices, has varied over time with some increase in wheat, and a drop in other crops (Chart 2). The II. Stylised Facts margins could vary across crops for several reasons, Rabi Season such as transaction costs, wastage during transit, India’s agriculture year (July-June) comprises two length of the holding cycle, mandi-level competition major seasons: kharif and rabi.3 The sowing of kharif and infrastructure facilities. crops, which require a hot and humid climate, starts Since margins at the aggregate level do not with the onset of the southwest monsoon around the generally capture mark-ups6 at various stages of the first week of June and finishes by around the end of supply chain (i.e., traders and retailers) and between September. The rabi (winter) season sowing starts in production and consumption centres, an in-depth October and continues till the first week of February analysis of price build-up from farm to retail level and generally requires a cold and dry climate. The assumes importance. While the previous surveys of rabi season accounts for around 48 per cent of the 2022 and 2018 focused on Kharif crops, the present annual foodgrains production. survey covers Rabi crops, thereby filling an important Crop-wise, wheat, gram and lentils within pulses, data gap. as well as rapeseed and mustard within oilseeds, are III. Objectives, Coverage and Methodology of Survey the major rabi crops grown exclusively during the rabi season. Over the years, the area and yield for Survey Objectives rabi crops have increased (Chart 1). The current study uses a market structure that Rabi crops have faced various challenges in terms considers traders and retailers as intermediaries of climate change and geopolitical tensions4 in the last two years. With significant implications for food 4 With Russia and Ukraine as major global players in wheat and edible oil markets, the geopolitical tensions between the two countries led to 1 The crops overlapping with the previous two kharif surveys include - significant increase in international prices of these commodities that tomato, onion, potato (TOP) and rice. affected the domestic prices in India also. 2 The findings can be highly sensitive to the sample coverage and timing 5 With retail prices being paid by the end-consumer and mandi prices of the survey. assumed to reflect the price received by the farmer, margin is calculated 3 The third cropping season is Zaid (summer) season. However, it has a as the difference between the two. Margins are presented as per cent of minimal share, and separate data reporting for this season has started very retail prices. recently. This study follows the earlier practice of clubbing it with rabi to 6 Mark-up is the difference between revenue and total cost (including have a longer time series of data. transaction cost) as per cent to total cost. 100 RBI Bulletin February 2025Dynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Chart 1: Rabi Crops a. Major Rabi Crops (Share in area sown during rabi season 2023-24, in per cent) Rapeseed and Rice (9.8) Mustard (12.7) Others (6.3) Oilseeds (14.8) Lentil (2.4) Gram (13.3) Coarse Cereals Wheat (9.2) (44.1) Others (5.2)Maize (4.0) b. Area under Foodgrains c. Yield of Foodgrains d. Area under Oilseeds e. Yield of Oilseeds Sources: Agricultural Statistics at a Glance, 2023, Unified Portal for Agricultural Statistics; and Economic and Political Weekly Research Foundation. between farmers and consumers, like the practice in consumer prices8, estimate the usage of different adopted in the past RBI surveys conducted in 2018 payment instruments in agricultural sales/trading, and 2022.7 The primary objectives of the study are understand the perceptions of various stakeholders to assess the share of various market participants towards existing challenges in the agri-supply chain and assess the efficacy of the policy measures. 7 Given the inherent complexity of agriculture supply chains, with variations in number and roles of intermediaries across crops and regions, this study categorises the supply chain participants into three broad groups (farmers, traders, and retailers). While the existence of other 8 For studying the value chain of a commodity, the average prices across intermediaries is acknowledged, this categorisation was done to ensure the intermediaries and centres are used here rather than tracing the prices consistency and facilitate a comparative analysis. of the same item across intermediaries in the same location. RBI Bulletin February 2025 101 )1.2( srehtO 140 120 100 80 60 40 20 0 seratceh noilliM seratceh noilliM 27-1791 57-4791 87-7791 18-0891 48-3891 78-6891 09-9891 39-2991 69-5991 99-8991 20-1002 50-4002 80-7002 11-0102 41-3102 71-6102 02-9102 42-3202 eratceh/gK eratceh/gK 3500 3000 2500 2000 1500 1000 500 0 Kharif Rabi Kharif Rabi 27-1791 67-5791 08-9791 48-3891 88-7891 29-1991 69-5991 00-9991 40-3002 80-7002 21-1102 61-5102 02-9102 42-3202 Kharif Rabi 35 30 25 20 15 10 5 0 Kharif Rabi 27-1791 67-5791 08-9791 48-3891 88-7891 29-1991 69-5991 00-9991 40-3002 80-7002 21-1102 61-5102 02-9102 42-3202 1800 1600 1400 1200 1000 800 600 400 200 27-1791 67-5791 08-9791 48-3891 88-7891 29-1991 69-5991 00-9991 40-3002 80-7002 21-1102 61-5102 02-9102 42-3202 Pulses (22.0)ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season Chart 2: Mandi Prices vis-à-vis Retail Prices for Key Food Items a. Cereals: Wheat b. Pulses: Gram/Chana c. Vegetables: Potato d. Vegetables: Tomato e. Vegetables: Onion Sources: Agmarknet (mandi prices) and Department of Consumer Affairs (retail prices). Survey Methodology survey was conducted during May-July 2024 in select The survey covered mandis/villages in 86 centres production and consumption centres separately, across 18 states for 12 rabi crops using three separate considering the difference in supply chain dynamics questionnaires for farmers, traders, and retailers. of production centres, confined majorly in rural It included 10,699 respondents across various areas and consumption centres lying mostly in urban consumption and production centres (Table 1). The settlements. 102 RBI Bulletin February 2025 gk rep ₹ gk rep ₹ gk rep ₹ tnec reP tnec reP gk rep ₹ gk rep ₹ tnec reP tnec reP tnec reP 45 70 40 60 35 50 30 40 25 30 20 20 15 10 10 5 0 Margin (% of retail price)(RHS) Retail Price (atta) Margin (% of retail price)(RHS) Retail Price (Gram dal) Mandi Price (wheat) Mandi Price (Gram) Margin (% of retail price)(RHS) Retail Price Margin (% of retail price)(RHS) Retail Price Mandi Price Mandi Price Margin (% of retail price)(RHS) Mandi Price Retail Price 11-rpA 21-raM 31-beF 41-naJ 41-ceD 51-voN 61-tcO 71-peS 81-guA 91-luJ 02-nuJ 12-yaM 22-rpA 32-raM 42-beF 70 155 60 130 50 105 40 80 30 55 20 30 10 5 0 11-rpA 21-raM 31-beF 41-naJ 41-ceD 51-voN 61-tcO 71-peS 81-guA 91-luJ 02-nuJ 12-yaM 22-rpA 32-raM 42-beF 120 70 60 100 50 80 40 60 30 40 20 20 10 0 0 11-rpA 21-beF 21-ceD 31-tcO 41-guA 51-nuJ 61-rpA 71-beF 71-ceD 81-tcO 91-guA 02-nuJ 12-rpA 22-beF 22-ceD 32-tcO 42-guA 60 70 50 60 50 40 40 30 30 20 20 10 10 0 0 11-rpA 21-beF 21-ceD 31-tcO 41-guA 51-nuJ 61-rpA 71-beF 71-ceD 81-tcO 91-guA 02-nuJ 12-rpA 22-beF 22-ceD 32-tcO 42-guA 100 70 90 60 80 70 50 60 40 50 40 30 30 20 20 10 10 0 0 11-rpA 11-peS 21-beF 21-luJ 21-ceD 31-yaM 31-tcO 41-raM 41-guA 51-naJ 51-nuJ 51-voN 61-rpA 61-peS 71-beF 71-luJ 71-ceD 81-yaM 81-tcO 91-raM 91-guA 02-naJ 02-nuJ 02-voN 12-rpA 12-peS 22-beF 22-luJ 22-ceD 32-yaM 32-tcO 42-raM 42-guADynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Table 1: Coverage of Surveys Survey Mandi/Centre (Number of respondents) Commodities Round Segment Consumption Production Total Centres Centres 2024 (Rabi) Farmers - 3800 3800 Cereals: Rice, Wheat, and Maize Pulses: Gram (Chana) and Lentil Retailers 2447 570 3017 Oilseeds: Rapeseed and Mustard Traders 2953 929 3882 Fruits and Vegetables: Mango, Onion, Potato, Tomato and Cauliflower Total 5400 5299 10699 Spices: Garlic 2022 (Kharif) Farmers - 2134 2134 Cereals: Paddy/Rice Pulses: Tur, Moong, Urad Retailers 3640 648 4288 Oilseeds: Groundnut, Soyabean Traders 3787 960 4747 Fruits and Vegetables: Apple, Banana, Coconut, Onion, Potato, Total 7427 3742 11169 Tomato, Green chillies and Brinjal Spices: Turmeric 2018 (Kharif) Farmers 1147 1664 2811 Cereals: Paddy/Rice Pulses: Tur, Moong, Urad, Bengal gram Retailers 2356 1052 3408 Oilseeds: Groundnut, Soyabean Traders 2176 1008 3184 Fruits and Vegetables: Apple, Banana, Coconut, Onion, Potato, Total 5679 3724 9403 Tomato, Green chillies and Brinjal Spices: Turmeric, red chillies Source: Primary surveys. Two-stage sampling was used to select the crops covered under the Survey and the shares are respondents. Production centres were chosen based generally higher for non-perishable crops (Chart 3). on their production share of the select rabi crops. In The farmers’ share is the highest at 67 per cent in the production centres, mandis were identified as the case of wheat which is a notified commodity11 the first-stage units, and traders and retailers (within for which a significant share of produce is sold by mandi and 5 km of mandi) were second-stage units. For the farmers through the public procurement system. participating farmers9, the villages near the identified Around one-fourth of the respondent wheat farmers mandis were selected first, followed by the selection in the 2024 survey reported to have sold their output of the farmer households. The second stage selection to the government under a procurement system. process was random. The dataset was trimmed by Procurement at minimum support price (MSP) gives eliminating the outliers pertaining to the estimated farmers an assured market option. The estimate of 67 cost and profit margin per kilogram for traders and per cent in this study is consistent with the available retailers.10 literature which suggests that wheat farmers’ share in IV. Survey Findings and Empirical Analysis the consumer price ranges between 53 per cent and 74 per cent (RACP, 2016 and Kumar et al., 2023). Survey Findings Within pulses, lentil producers receive around The average share of farmers in consumer prices 66 per cent and gram (chana) around 60 per cent12 varies between 40 per cent and 67 per cent for the of the rupee spent by the consumers. A higher share 9 Following the survey done in 2022, farmers were covered in the production centres alone. 11 The Agricultural Produce Market Committee (APMC) Act notifies 10 While every effort has been made to ensure the quality of responses agriculture commodities produced in the region and provides that first through rigorous questionnaire design, robust sampling and telephonic sale in these commodities can be conducted only under the aegis of the verification of respondents, inherent limitations of primary surveys such APMC through the commission agents licensed by the APMCs set up under as social desirability bias may still exist. The data used in the study is self- the Act (GoI, 2015). reported data and hence, is subject to potential recall error. Further, there 12 The farmers’ share for gram was estimated at 75 per cent in Jose et al. could be loss of some information due to data trimming. (2024). RBI Bulletin February 2025 103ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season depending upon the prevailing demand-supply Chart 3: Farmers’ Share in Consumer Prices conditions. The existing literature suggests farmers’ share to be in the range of 30-50 per cent of the final price in the case of fruits and vegetables (Gandhi and Namboodiri, 2002; Bhoi et al., 2019; Das et al., 2024). The perishable products are characterised by short shelf-life cycles, seasonal production, diverse quality and quantity, special logistical requirements, quality standards, demand and cost uncertainties, dependency on climatic conditions and supply chain lead time that create more uncertainties about their timely and sufficient availability in the markets (Duarte, 2024). In India, the fruit and vegetable supply chain comprises of many unorganised intermediaries, which creates difficulties in identifying the flow of products, funds and information across the supply chain, and, can compress farmers’ share in consumer of farmers is desirable for lentils to incentivise prices (Patidar et al., 2018). A lower share of farmers’ production, as it is mainly grown by small-holder can also act as a constraint for farmers in diversifying farmers and there is significant import dependency from traditional cereal crops. As per the current (Malik et al., 2021). Within oilseeds, the survey results survey, the combined share of traders and retailers is put farmers’ share for rapeseed and mustard (R&M) at estimated to be more than half for all surveyed fruits 52 per cent, comparable with the 55 per cent estimate and vegetables except tomatoes. reported by Layek et al. (2021). R&M are the second Amongst the set of crops which were surveyed in highest in terms of area and production after soybean previous kharif rounds and this rabi round survey, the and they contribute the most to the total edible oil farmers’ share in retail prices of rice is estimated at basket of India (GoI, 2022). The government is also around 52 per cent in this survey.15 The shares were active in procuring it through the public procurement 45 and 49 per cent during the Kharif surveys of 2022 system to provide an assured market for the farmers. and 2018, respectively. The TOP (Tomato, Onion, The farmers’ share in the prices of perishable Potato) are primarily rabi crops. The farmers’ share commodities (fruits and vegetables) is estimated in consumer prices in the rabi survey is also broadly around 40-63 per cent. The share in consumer prices comparable to the estimates of the previous two kharif in case of perishable items can fluctuate widely surveys (Chart 4). 13 The oilseeds (here R&M) are sold by farmers as seeds but purchased by Traders’ and Retailers’ Mark-ups the final consumers in the form of oil. Moreover, the oilcake (leftover after extracting oil) is used as feed for cattle, poultry or fisheries. Accordingly, Regarding the price build-up across the agriculture while computing the farmer’s share, the retail price of oil has been value chain, i.e., between farmers’ price realisation converted to that of seed equivalent (at conversion rate of 0.4). Similarly, paddy gets converted into rice after milling which is then sold as final and the price charged by retailers, it was observed that product at retail level. Wheat is also not generally sold as whole grain, rather purchased as atta at retail level. Accordingly, a conversion rate of farmers, traders, and retailers incur various charges 0.67 in the case of rice and a price differential for wheat (of around ₹4/kg) has been applied while computing the farmers’ share. 15 Rice is mainly a kharif crop. Kharif rice and rabi (including zaid) rice 14 Indian Institute of Maize Research (https://iimr.icar.gov.in/?page_ have shares of around 80 per cent and 20 per cent, respectively, in total id=51). rice production. 104 RBI Bulletin February 2025 tnec reP 80 70 67 66 63 60 59 60 52 52 50 47 43 42 40 40 30 20 10 0 Note: Conversion factors have been used to calculate farmers' shares in rapeseed, mustard (R&M), wheat and paddy13. Maize has been dropped as retail consumers do not consume a significant portion of the produce (only 13 per cent14). Source: Authors calculations are based on 2024 survey data. taehW )roosaM( litneL cilraG )marG( anahC otamoT M& R )itamsab-non( eciR noinO rewolfiluaC ognaM otatoPDynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season The mark-ups of traders and retailers, defined Chart 4: Farmers’ Share in Consumer Prices (Kharif vis-à-vis Rabi Surveys) as revenue less total cost (cost of products and transaction costs) as a percentage of the total cost, may vary amongst crops due to factors such as variation in storage cost depending on the length of holding cycle, quality including crop loss during transit and the shelf-life of the produce. The retailers’ mark-ups across the surveyed commodities were estimated around 7-25 per cent, generally higher than those of the traders (5-23 per cent) in both production and consumption centres. Further, the traders’ and retailers’ mark-ups for perishables were observed to be higher than those for non-perishables (Chart 5). These survey findings are in consonance with other recent studies (Gulati et al., 2022). Higher traders’ markup for potatoes16 in production centres during transactions. For farmers, post-harvest costs in this survey could be a reflection of the surge in primarily include commission and mandi charges, wholesale prices during the survey period, outpacing loading/unloading charges, packing, weighing and the increase in retail prices. grading charges. For traders and retailers, the factors influencing their mark-ups include membership fees, Amongst the common crops in the previous transport costs, shop rentals, local taxes, and storage surveys and this survey, the mark-ups of traders and costs. retailers appear to have generally moderated over 16 Rabi season accounts for 90 per cent of the overall potato production. RBI Bulletin February 2025 105 tnec reP 70 61 59 60 55 52 49 50 47 46 45 40 40 36 33 28 30 20 10 0 Tomato Onion Potato Rice Kharif 2018 Kharif 2022 Rabi 2024 Sources: Authors calculations are based on Kharif and Rabi survey data. Chart 5: Traders’ and Retailers’ Mark-up a. Production Centre b. Consumption Centre *: Non-basmati rice only. R&M: Rapeseed and mustard. Source: Authors calculations are based on 2024 survey data. tnec reP tnec reP 25 20 15 10 5 0 ognaM rewolfiluaC otamoT noinO cilraG otatoP marG litneL eziaM *eciR taehW M&R 25 20 15 10 5 0 Fruits Vegetables Pulses Cereals Oil seeds Retailers Traders Retailers Traders ognaM rewolfiluaC otamoT noinO cilraG otatoP marG litneL eziaM *eciR taehW M&R Fruits Vegetables Pulses Cereals Oil seedsARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season the previous survey results (Chart 6)17. At the same retailers for transactions and these data reveal time, it may be noted that TOP are predominantly that cash payments hold the highest share in their rabi crops; the lower mark-ups of traders and retailers respective total payments - around 72 per cent for in these items might be a reflection of the ample farmers, 45 per cent for traders and 61 per cent for availability of perishable produce during this season retailers; the shares have, however, declined by (Jose et al., 2021). Further, the government’s recent 7-13 percentage points relative to the 2022 survey, policy measures, such as maintenance of buffer although it may be noted that the crop coverage in the stock and external trade regulation of onion, supply two surveys is different. Concomitantly, the usage of through retail outlets such as Mother Dairy, Safal, electronic payments, though highest for traders, has and Kendriya Bhandar and setting up of the Price increased for all supply chain agents in line with the Stabilisation Fund (PSF) for TOP vegetables might growing digitalisation of payments in the country18; as per the survey, 18-31 per cent of the responses were have contained the intermediaries’ mark-ups. for electronic modes of payments (Chart 7). Cash- Usage of Payment Instruments based value chains and market barriers can lead to The survey also collected data on the usage lower returns for farmers (APEC, 2017). Digitalising of payment instruments by farmers, traders, and agricultural payments can help make it easier for Chart 6: Traders’ and Retailers’ Mark-up in 2024 vis-à-vis Past Surveys a. Traders-Production Centre b. Traders-Consumption Centre c. Retailers-Production Centre d. Retailers-Consumption Centre *: Non-basmati rice only. Sources: Authors calculations are based on 2018, 2022 and 2024 survey data. 17 The study’s comparison to previous surveys is subject to the change of agriculture marketing season as previous surveys were conducted during kharif marketing season. 18 The usage of electronic payments, reported during 2022 survey, reflected an increase of more than 3-fold for traders and 5-fold for retailers relative to 2018 survey (Suganthi et al., 2024). 106 RBI Bulletin February 2025 tnec reP tnec reP tnec reP tnec reP 30 70 60 25 50 20 40 15 30 10 20 5 10 0 0 Tomato Potato Onion Rice* Tomato Potato Onion Rice* Kharif 2018 Kharif 2022 Rabi 2024 Kharif 2018 Kharif 2022 Rabi 2024 60 60 50 50 40 40 30 30 20 20 10 10 0 0 Tomato Potato Onion Rice* Tomato Potato Onion Rice* Kharif 2018 Kharif 2022 Rabi 2024 Kharif 2018 Kharif 2022 Rabi 2024Dynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Chart 7: Modes of Payment a. Kharif 2022 b. Rabi 2024 Note: ‘Others’ in Chart 7a includes redeemable receipts, on credit and vouchers; and ‘Others’ in Chart 7b includes redeemable receipts, cheques and credit transactions. Source: Authors calculations are based on Kharif 2022 and Rabi 2024 survey data. farmers to buy directly from input providers and sell Price Volatility directly to consumers, developing greater resilience As per Rabi Survey 2024, 85 per cent of surveyed of farmers to income shocks, especially in the light retailers believed that supply shocks are the main of their increasing vulnerability to adverse weather reason behind the sudden rise in prices, followed events and climate change (World Bank, 2024). by seasonal factors (Chart 8a). This is endorsed by RBI Bulletin February 2025 107 sesnopser fo tnec reP sesnopser fo tnec reP 90 80 72 79 80 70 70 68 61 60 60 58 50 45 50 40 40 31 30 30 28 24 22 20 14 15 14 17 20 18 10 17 10 10 7 0 0 Cash Electronic Others Cash Electronic Others Farmers Traders Retailers Farmers Traders Retailers Chart 8: Understanding Inflation and Price Volatility of Agri-Crops a. Reason for sudden spike in prices: b. Farmers experienced crop damage c. Reasons for crop damage during Retailers’ views during 2023-24 rabi season 2023-24 rabi season: Farmers' views 40 Supplyshock 35 30 Seasonalfactors 25 20 Global price movements 15 10 Change in International 5 TradePolicy 0 Geopoliticaltensions (eg. recent Russia Ukraine war) 0 20 40 60 80 100 Per centofrespondents stnednopser fo tnec reP llafniar lanosaesnU skcatta tseP hgih/evawtaeH erutarepmet / deyaleD llafniar tneicifed weD llafniar ssecxE mrotsliaH No, 36% Yes, 64% Note: Response percentages may not sum up to 100 per cent as the question allows for respondents to choose multiple options. Source: Authors calculations are based on 2024 survey data.ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season the farmer respondents, with 64 per cent of them Chart 9: Factors Affecting Farmer’s Crop experiencing some form of crop damage during Sowing Decision the 2023-24 rabi season. Almost 37 per cent of the Weather Forecast farmers held unseasonal rainfall as the primary Irrigation availability Expected Price reason for damages, followed by pest attacks and Availability of key inputs heatwaves (Chart 8b and 8c). Weather forecasts and MSP the availability of irrigation are observed to be the Cost of inputs primary factors that determine crop-sowing patterns Price realised last year for farmers (Chart 9). Govt Procurement Availability of crop insurance According to the survey, the traders and retailers Stock limits on crops reported higher wastages in fruits and vegetables Export /Import policy Advisory by Government relative to other crops (Chart 10). More than 10 Contract Farming per cent of the output wastage was reported to 0 10 20 30 40 50 60 70 80 90 100 be prominent in the case of fruits and vegetables. Per cent of total farmers Note: Response percentages may not sum up to 100 per cent as the question Inadequate storage facilities, power outages, poor allows for respondents to choose multiple options. Source: Authors calculations are based on 2024 survey data. infrastructure connectivity to agricultural areas, and insufficient road and highway networks in limits, restricting certain exports and liberalising India contribute to high post-harvest losses and the certain imports and open market sales to ensure wastage is estimated to be in the range of 20-44 per ample supplies in the domestic market. As per 59 cent (Kumar et al., 2020; Kumar and Agrawal, 2023; per cent of the surveyed retailers, such intervention Rais and Sheoran, 2023; NHB 2021 and Duarte, 2024). measures could be effective in curbing price pressures To control price pressures, the government has in the short run. Further, external trade and stock in the recent years undertaken several crop-specific measures are suggested to be effective by almost half policy interventions such as imposition of stock of the total respondents (Chart 11). Chart 10: Extent of Wastage in Agri Supply Chain: Traders’ and Retailers’ View Source: Authors calculations are based on 2024 survey data. 108 RBI Bulletin February 2025 stnednopser fo tnec reP 120 94 100 92 91 92 94 95 90 95 96 88 80 67 62 60 40 25 22 13 20 6 4 2 1 8 7 1 1 11 4 5 1 0 9 9 3 1 4 4 0 0 0 %5-0 %01-5 %01> %5-0 %01-5 %01> %5-0 %01-5 %01> %5-0 %01-5 %01> %5-0 %01-5 %01> %5-0 %01-5 %01> Rice [Non-basmati] Wheat Fruits and Pulses Maize Rapeseed and Vegetables Mustard Trader RetailerDynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Chart 11: Relevance of Short-term Policy Measures Chart 12: Source of Information for in Managing Inflation: Retailers' Views Farmers about Market Prices Export ban Allow imports Stock restrictions Retail sale by govt. No idea 0 10 20 30 40 50 60 Per cent of total respondents Note: Response percentages may not sum up to 100 per cent as the question Note: Response percentages may not sum up to 100 per cent as the question allows for respondents to choose multiple options. allows for respondents to choose multiple options. Source: Authors calculations are based on 2024 survey data. Source: Authors calculations are based on 2024 survey data. Agricultural Marketing participants, appear to serve as the dominant source of market information. Timely and reliable information on market prices can help farmers in the marketing of their On improving marketing of agri-produce, the produce. As per the survey, about 76 per cent of the respondent farmers’ main policy recommendation farmers had information about prevailing market included ‘creation of more markets in the villages’, prices and they sourced it primarily from traders in while traders reported liberalisation of the trade their contact (Chart 12). The traders, being the main policy as the most essential tool (Chart 13). Although agriculture marketing has been one of the main areas interlink between farmers and other supply chain RBI Bulletin February 2025 109 sremraf fo tnec reP 60 50 40 30 20 10 0 tcatnoc ni sredarT sremraf rehtO ppA eliboM/etisbeW secivres SMS rehtO Chart 13: Suggestions to Improve Agriculture Marketing b. Traders Note: Response percentages may not sum up to 100 per cent as the question allows for respondents to choose multiple options. Source: Authors calculations are based on 2024 survey data. stnednopser latot fo tnec reP stnednopser latot fo tnec reP a. Farmers 90 80 70 60 50 40 30 20 10 0 ylppus tupni ylemiT noisnapxe noitagirrI segalliv ni stekram eroM ytilibaliava naol esaercnI setar tseretni rewoL dna esuoheraW yticapac egarots .tvog esaercnI tnemerucorp noosnom elbailer eroM tsacerof /enilno dnapxE sidnam MAN-E tekram serutuf wollA gnidart 60 50 40 30 20 10 0 tcartnoc etomorP gnimraf tropmi dna tropxe wollA stimil egarots evomeR dna esuoheraw ecnahnE yticapac egarots dloc edart serutuf wollA idnam ni ytilicaf gnidarG sidnam erom etargetnI MAN-e otARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season of policy focus19, agriculture being a state subject, about change in commodity supply over last year; TC i implementing such policies is often hindered due is the transaction cost incurred per kg; and D denotes i to varying levels of regulation, willingness and the distance of the retailer outlet from the point of consensus among the states (GoI, 2024). In terms procurement. W denotes the retailer’s perception i of budgetary allocation, a significant share of regarding the extent of wastage experienced; N i government expenditure for agriculture has been represents the number of commodities sold by the observed to be apportioned more towards input retailer; E is the dummy variable capturing the d subsidies like fertiliser and power, rather than extreme weather events in terms of large excess, supply chain development (Zafar et al., 2023). excess and large deficient rainfall (cumulative) in the district. CT represents the fixed effect for Empirical Findings i retailer’s outlet location (production/consumption Mark-ups in the agriculture supply chain are the centre). C and P denote the fixed effect for c c crucial indicators of added value at each stage. While specific commodities and nature of commodity excessive mark-ups could lead to higher food prices, (perishable/non-perishable), respectively and ε is idc lower mark-ups could impact the stakeholders’ the residual. Three model specifications have been profitability (Bhattacharya, 2016). In the article presented here. While Model 1 (M1) serves as basic based on the previous round of this survey, an equation, the Model 2 (M2) utilises the interaction empirical exercise was carried out to understand the (W P) of wastage with the nature of commodity i c factors impacting the traders’ mark-ups (Suganthi et (perishable/non-perishable) at multiple levels of al., 2024). In this study, an attempt has been made × wastage. Further, Model 3 (M3) replaces the wastage to identify the determinants of the mark-ups at the with extreme weather events and attempts to retailers’ level based on the data collected from the understand the impact of the latter on mark ups survey. Ordinary Least Square regression has been of perishable commodities using the interaction run using following equation: variable (E P). d c M α β R βS βTC βD βW β W P β idc i i i 4 i i 6 i c The reg×ression analysis suggests that retailers E 1P 2β N 3 β CT β C5 β P ε 7 = +d c+ +i 9 + i + c + (c ×idc )+ are able to pass on the cost of wastage losses to 8 10 11 where(, i, ×d a)n+d c re+present+ ‘retail+e r’, ‘dis+t rict’ and consumers through higher retail prices in the case ‘commodity’, respectively. of perishable commodities (fruits and vegetables), while not being able to do so in the case of non- Here, M is the mark-up, defined as the selling idc perishables. Accordingly, while the mark-ups are price less total cost (including transaction cost) as a negatively impacted by product losses at the aggregate percentage of total cost for retailers. R represents i level (Model 1), for perishable commodities, the retailers’ demographic profile such as age, education impact is positive (Model 2) [Table 2]. This suggests and gender; S represents the retailer’s perception i that retailers can draw higher mark-ups for perishable 19 As part of strengthening agriculture markets, government initiated commodities, wherein the post-harvest loss incidence e-NAM to create a unified national market, thereby improving transparency and price discovery of agriculture commodities. Besides, government has and product differentiation are relatively higher (Gulati taken steps to upgrade the existing rural haats into well-equipped Gramin et al., 2022). Additionally, the transmission appears to Agricultural Markets to connect farmers directly with buyers. Further, to provide farmers with direct market access, FPOs have been onboarded on increase with the extent of wastage, as indicated by to Open Network for Digital Commerce (ONDC) portal for selling their produce online to consumers across the country. model 2. The same is also revealed in model 3 where 110 RBI Bulletin February 2025Dynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season the wastage dummy is replaced by extreme weather transportation facilities (Tchonkouang et al., 2024). conditions dummy.20 Weather disruptions are often The higher transaction cost (transportation, labour, one of the major contributors to post-harvest losses rent) is found to shrink the mark-ups. Among the and supply chain wastage in the absence of adequate demographic variables, male retailers realise higher availability of temperature-controlled storage and mark-ups across the various model specifications. Table 2: Determinants of Retailers’ Mark-ups: Regression Results Dependent variable: Markup (log) Model 1 (M1) Model 2 (M2) Model 3 (M3) Demographic variables Log(Age, Years) 0.11 -0.05 -0.03 (0.04)** (0.06) (0.05) Education (Dummy, SSC and above=1) 0.20 -0.01 0.01 (0.03)*** (0.04) (0.04) Gender (Dummy, Male =1) 0.19 0.15 0.11 (0.06)*** (0.08)* (0.06)* Higher supply compared to previous year (Dummy, Higher=1) -0.06 - - (0.05) Log (Transaction cost, Rs./kg) -0.06 -0.10 -0.04 (0.02)*** (0.02)*** (0.02)** Distance from place of procurement (1 if >10 km) 21 -0.07 -0.09 -0.04 (0.05) (0.06) (0.05) Wastage (1 if >2%) -0.43 - - (0.06)*** Wastage (Dummy, Base: 0-2%)*Perishable (Dummy) Wastage (2-5%)*Perishable - 1.15 - (0.11)*** Wastage (5-10%)*Perishable - 1.25 - (0.13)*** Wastage (>10%)*Perishable - 1.46 - (0.11)*** Extreme Weather (Dummy#)*Perishable (Dummy) - - 2.20 (0.11)*** Number of commodities sold by the retailer (Log) 0.03 0.01 0.02 (0.01)*** (0.01) (0.01)*** Intercept 1.23 2.62 2.42 (0.22)*** (0.27)*** (0.20)*** Centre fixed effect (Production/Consumption) Yes Yes Yes Commodity fixed effect Yes - - Perishable commodity fixed effect - Yes Yes Adj. R Square 0.57 0.23 0.56 No. of obs. 2287 2287 2287 ***,**&*: significance levels at 1%, 5%and 10% respectively. #: excess/large excess/large deficit rainfall. Note: Figures in parentheses are robust standard errors, clustered at district level . Source: Authors estimates are based on 2024 survey data. 20 a. https://seller.globallinker.com/bizforum/article/the-supply-chain-and-its-impact-on-agricultural-food-waste-in-india/8925#/overlay/signup/ articleview/8925 b. https://www.wri.org/insights/climate-adaptation-agricultural-supply-chains 21 Although statistically insignificant, the distance of the retail outlets from the procurement points appears negatively associated with the markups. RBI Bulletin February 2025 111ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season V. Conclusion improving such infrastructure, ultimately benefiting producers as well as consumers. This article provides insights into India’s agriculture supply chain across farmers, traders, References and retailers based on a pan-India survey of major Bhattacharya, R. (2016). How does Supply Chain rabi crops conducted during May-July 2024. The Distortion affect Food Inflation in India?. National survey results indicate that the farmers’ share in Institute of Public Finance and Policy. consumer prices ranges from 40 per cent to 67 per Bhoi, B., Kundu, S. Kishore, V and Suganthi, D. (2019). cent across the crops surveyed, with the wheat Supply Chain Dynamics and Food Inflation in India. producers realising the highest share. The perishable RBI Bulletin, October. crops (fruits and vegetables) have lower farmers’ Das, R., Roy, R., Gupta, S., Bordoloi, S., Kumar, R., share and higher trader/retailer markups than the Mohan, R. and Gulati, A. Price Dynamics and Value non-perishables. The combined share of traders Chain of Fruits in India: A Study of Grapes, Bananas and retailers in consumer prices is more than half and Mangoes. RBI WPS (DEPR), 06/2024. in perishables (except for tomatoes). The mark-ups of traders and retailers are observed to be lower Duarte, A.L.C.M., Rodrigues, V.P., & Costa, L.B.M. (2024). for TOP crops during the rabi season compared to The Sustainability Challenges of Fresh Food Supply the kharif season, partially reflecting the impact of Chains: An Integrative Framework. Environment, Development and Sustainability. April. (doi: 10.1007/ the ample availability of perishable produce during s10668-024-04850-9). the rabi production season. While cash transactions dominate the payments in the agriculture supply EU (2024). https://agriculture.ec.europa.eu/common- chain, electronic payments registered a significant agricultural-policy/agri-food-supply-chain/market- increase in 2024 survey over the previous surveys of transparency_en (European Commission). 2018 and 2022 for all the participants. The weather Gandhi, V.P. and Namboodiri, N.V. (2002). Fruit and forecast and irrigation availability appear to be the Vegetable Marketing and its Efficiency in India: A most critical factors in the farmers’ decision function Study of Wholesale Markets in the Ahmedabad Area. regarding rabi sowing. Indian Institute of Management. Ahmedabad. An empirical analysis of mark-ups, using the Government of India (GoI) (2015). Chapter 08: A survey data, indicates that higher transaction costs National Market for Agricultural Commodities- Some (transportation, labour, rent) reduce the retailers’ Issues and the Way Forward. Economic Survey (2014- markups, while higher post-harvest losses in 15), Ministry of Finance. perishables seems to permit the retailers to pass Government of India (GoI) (2025). Chapter 04: losses onto the consumers. Price and inflation:- understanding the dynamics. Overall, the survey findings and analysis indicate Economic Survey (2024-25), Ministry of Finance. that further strengthening of market infrastructure Government of India (GoI) (2024). National Policy through increased investment in cold storages and Framework on Agricultural Marketing (Draft). transportation systems can make agriculture supply Ministry of Agriculture and Farmers’ Welfare. chain more efficient and lower the post-harvest (https://www.dmi.gov.in/Documents/DraftNational losses. 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Findings from Survey of Gram and Mustard Farmers Kumar, A., Mangla, S., Kumar, P. and Karamperidis, in Madhya Pradesh and Rajasthan. Arcus Research S. (2020). Challenges in Perishable Food Supply Report 4. New Delhi. March. Chains for Sustainability Management: A Developing Singh, R.K., Patil, T., Pandey, D. and Sawarkar, A.N. Economy Perspective, Business Strategy and the (2021). Pyrolysis of Mustard Oil Residue: A Kinetic Environment, 29(5). pp. 1809-1831. (doi: 10.1002/ and Thermodynamic Study. Bioresource Technology. bse.2470). Volume 339, November. Kumar, S., Bhargava, H., Singh, P., Singh, J. and Verma, Suganthi, D., Kumar, R. and Sethi, M. (2024). S.K. (2023). Economic Analysis of Marketing Channel Agriculture Supply Chain Dynamics: Evidence from of Wheat Production in Hardoi District of Western Pan-India Survey. RBI Bulletin, January. Uttar Pradesh, India. Asian Journal of Agricultural Extension, Economics &Sociology. Volume 41. Issue Tchonkouang, R. D., Onyeaka, H. and Nkoutchou, 10. pp140-148. H. (2024). Assessing the Vulnerability of Food Supply Chains to Climate Change-Induced Malik, D.P., Devi, M. and Reddy, A.A. (2022). Global Disruptions. Science of the Total Environment, Status of Lentil Production with Special Reference to India. Indian Journal of Agricultural Sciences 92 (4). 171047. April. Villacis, A.H., Kopp, T and Mishra, A.K. (2024). National Horticulture Board (2021). National Agricultural Marketing Channels and Market Prices: International Year of Fruits and Vegetables. October. Evidence from High-Value Crop Producers in India. (https://www.nhb.gov.in/KnowledgeCenter/IFVY- Economic Analysis and Policy. Volume 81. pp 1308- Presentation-Nov.pdf) 1321. (https://doi.org/10.1016/j.eap.2024.02.004). RBI Bulletin February 2025 113ARTICLE Dynamics of Agriculture Supply Chain: Insights from Pan India Survey during Rabi Marketing Season World Bank (2024). Data from the Global Findex Zafar, S., Aarif, M. and Tarique, M. (2023). Input 2021: Digitalizing Agricultural Payments in Sub- Subsidies, Public Investments and Agricultural Saharan Africa. Regional Note. November. (https:// Productivity in India. Futur Bus J 9, 54 (2023). www.worldbank.org/en/publication/globalfindex/ brief/data-from-the-global-findex-2021-digitalizing- agricultural-payments-in-sub-Saharan-africa). 114 RBI Bulletin February 2025Dynamics of Agriculture Supply Chain: Insights from Pan India ARTICLE Survey during Rabi Marketing Season Annex 1: Government Schemes for Improving Supply Chain in Agriculture To improve the agriculture supply chain, the 4. Integrated Cold Chain, Food Processing, and government has implemented various schemes in Preservation Infrastructure scheme recent years. Some of the important schemes include: The Integrated Cold Chain, Food Processing, and 1. eNAM Preservation Infrastructure scheme aims to facilitate the establishment of a strong cold chain facility eNational Agriculture Market (eNAM), a pan- for agricultural, horticultural, dairy, fish & marine, India electronic trading portal, was launched in 2016. poultry & meat products by establishing linkage It networks the existing Agriculture Produce Market from the farm gate to the consumer, to reduce Committee (APMC) mandis to create a unified losses through efficient storage, transportation, and national market for agricultural commodities. minimal processing. As of August 2024, there are Presently, 1410 mandis in 23 states and 4 UTs are 8,698 cold storages in the country with a capacity integrated on eNAM. of 396 lakh MT. Besides, the government of India 2. The Agricultural Marketing Infrastructure (AMI) has launched Kisan Rail to cater exclusively to the scheme movement of perishable agri-horti commodities. The AMI scheme aids with the construction 5. Prime Minister Dhan-Dhaanya Krishi Yojana or renovation of godowns and warehouses in rural The budget 2025-26 has announced the launch areas to boost agricultural storage capacity. Since the of ‘Prime Minister Dhan-Dhaanya Krishi Yojana’ in scheme’s inception on April 1, 2001, through June 100 low productivity districts wherein measures to 30, 2024, a total of 48,512 storage infrastructure augment post-harvest storage at the panchayat and projects, with a combined capacity of 940 lakh block level would be taken. tonnes, have been sanctioned across 27 states with 6. Comprehensive Programme for Vegetables & subsidy disbursement of Rs. 4,735 crore. Fruits 3. The Agriculture Infrastructure Fund (AIF) The budget 2025-26 also announced a scheme comprehensive programme for vegetables and The AIF scheme aims to attract investments for fruits to promote production, efficient supplies, agricultural infrastructure development, with a total processing, and remunerative prices for farmers in allocation of Rs 1 lakh crore until 2025-26. Under partnership with states. Appropriate institutional the scheme, loans with subsidised interest rates are mechanisms for implementation and participation provided for investments in farm-gate infrastructure of farmer producer organizations and cooperatives like cold storage, warehouses, grading and sorting will also be set up. The government also announced units and e-marketing platforms. As of January 2025, to upgrade infrastructure and warehousing for air Rs. 53,687 crore has been sanctioned for 89,028 cargo including high value perishable horticulture projects under the scheme. produce. RBI Bulletin February 2025 115CURRENT STATISTICS Select Economic Indicators Reserve Bank of India Money and Banking Prices and Production Government Accounts and Treasury Bills Financial Markets External Sector Payment and Settlement Systems Occasional SeriesCURRENT STATISTICS Contents No. Title Page 1 Select Economic Indicators 119 Reserve Bank of India 2 RBI – Liabilities and Assets 120 3 Liquidity Operations by RBI 121 4 Sale/ Purchase of U.S. Dollar by the RBI 122 4A Maturity Breakdown (by Residual Maturity) of Outstanding Forwards of RBI (US$ Million) 123 5 RBI's Standing Facilities 123 Money and Banking 6 Money Stock Measures 124 7 Sources of Money Stock (M) 125 3 8 Monetary Survey 126 9 Liquidity Aggregates 127 10 Reserve Bank of India Survey 128 11 Reserve Money – Components and Sources 128 12 Commercial Bank Survey 129 13 Scheduled Commercial Banks' Investments 129 14 Business in India – All Scheduled Banks and All Scheduled Commercial Banks 130 15 Deployment of Gross Bank Credit by Major Sectors 131 16 Industry-wise Deployment of Gross Bank Credit 132 17 State Co-operative Banks Maintaining Accounts with the Reserve Bank of India 133 Prices and Production 18 Consumer Price Index (Base: 2012=100) 134 19 Other Consumer Price Indices 134 20 Monthly Average Price of Gold and Silver in Mumbai 134 21 Wholesale Price Index 135 22 Index of Industrial Production (Base: 2011-12=100) 139 Government Accounts and Treasury Bills 23 Union Government Accounts at a Glance 139 24 Treasury Bills – Ownership Pattern 140 25 Auctions of Treasury Bills 140 Financial Markets 26 Daily Call Money Rates 141 27 Certificates of Deposit 142 28 Commercial Paper 142 29 Average Daily Turnover in Select Financial Markets 142 30 New Capital Issues by Non-Government Public Limited Companies 143 RBI Bulletin February 2025 117CURRENT STATISTICS No. Title Page External Sector 31 Foreign Trade 144 32 Foreign Exchange Reserves 144 33 Non-Resident Deposits 144 34 Foreign Investment Inflows 145 35 Outward Remittances under the Liberalised Remittance Scheme (LRS) for Resident Individuals 145 36 Indices of Nominal Effective Exchange Rate (NEER) and Real Effective Exchange Rate (REER) of the Indian Rupee 146 37 External Commercial Borrowings (ECBs) – Registrations 147 38 India’s Overall Balance of Payments (US $ Million) 148 39 India's Overall Balance of Payments (` Crore) 149 40 Standard Presentation of BoP in India as per BPM6 (US $ Million) 150 41 Standard Presentation of BoP in India as per BPM6 (` Crore) 151 42 India’s International Investment Position 152 Payment and Settlement Systems 43 Payment System Indicators 153 Occasional Series 44 Small Savings 155 45 Ownership Pattern of Central and State Governments Securities 156 46 Combined Receipts and Disbursements of the Central and State Governments 157 47 Financial Accommodation Availed by State Governments under various Facilities 158 48 Investments by State Governments 159 49 Market Borrowings of State Governments 160 50 (a) Flow of Financial Assets and Liabilities of Households - Instrument-wise 161 50 (b) Stocks of Financial Assets and Liabilities of Households- Select Indicators 164 Notes: .. = Not available. – = Nil/Negligible. P = Preliminary/Provisional. PR = Partially Revised. 118 RBI Bulletin February 2025CURRENT STATISTICS No. 1: Select Economic Indicators 2023-24 2024-25 Item 2023-24 Q1 Q2 Q1 Q2 1 2 3 4 5 1 Real Sector (% Change) 1.1 GVA at Basic Prices 7.2 8.3 7.7 6.8 5.6 1.1.1 Agriculture 1.4 3.7 1.7 2.0 3.5 1.1.2 Industry 9.3 5.0 13.6 7.4 2.1 1.1.3 Services 7.9 10.4 6.9 7.7 7.1 1.1a Final Consumption Expenditure 3.8 4.6 4.1 6.3 5.7 1.1b Gross Fixed Capital Formation 9.0 8.5 11.6 7.5 5.4 2023 2024 2023-24 Nov. Dec. Nov. Dec. 1 2 3 4 5 1.2 Index of Industrial Production 5.9 2.5 4.4 5.0 3.2 2 Money and Banking (% Change) 2.1 Scheduled Commercial Banks 2.1.1 Deposits 12.9 13.5 12.6 11.1 10.2 (13.5) (14.2) (13.3) (10.7) (9.8) 2.1.2 Credit # 16.3 16.7 15.6 11.8 12.4 (20.2) (21.1) (20.0) (10.6) (11.2) 2.1.2.1 Non-food Credit # 16.3 16.8 15.8 11.8 12.4 (20.2) (21.3) (20.1) (10.6) (11.1) 2.1.3 Investment in Govt. Securities 11.1 15.6 15.6 9.5 11.1 (12.8) (17.7) (17.6) (8.4) (10.1) 2.2 Money Stock Measures 2.2.1 Reserve Money (M0) 5.6 6.7 6.0 7.1 4.9 2.2.2 Broad Money (M3) 11.1 11.2 11.0 11.1 9.3 (9.0) (11.8) (11.5) (10.8) (9.0) 3 Ratios (%) 3.1 Cash Reserve Ratio 4.50 4.50 4.50 4.50 4.25 3.2 Statutory Liquidity Ratio 18.00 18.00 18.00 18.00 18.00 3.3 Cash-Deposit Ratio 5.0 5.2 5.2 5.1 4.7 (5.0) (5.2) (5.2) (5.1) (4.7) 3.4 Credit-Deposit Ratio 78.1 77.2 77.1 77.7 78.7 (80.3) (79.6) (79.5) (79.5) (80.4) 3.5 Incremental Credit-Deposit Ratio # 95.8 92.3 89.1 72.8 86.1 (113.4) (118.8) (111.9) (69.8) (82.6) 3.6 Investment-Deposit Ratio 29.5 29.8 29.5 29.6 29.8 (29.8) (30.2) (29.8) (29.7) (29.9) 3.7 Incremental Investment-Deposit Ratio 25.8 27.8 24.7 29.9 32.6 (28.4) (31.8) (28.2) (28.1) (30.8) 4 Interest Rates (%) 4.1 Policy Repo Rate 6.50 6.50 6.50 6.50 6.50 4.2 Fixed Reverse Repo Rate 3.35 3.35 3.35 3.35 3.35 4.3 Standing Deposit Facility (SDF) Rate * 6.25 6.25 6.25 6.25 6.25 4.4 Marginal Standing Facility (MSF) Rate 6.75 6.75 6.75 6.75 6.75 4.5 Bank Rate 6.75 6.75 6.75 6.75 6.75 4.6 Base Rate 9.10/10.25 8.95/10.10 8.95/10.25 9.10/10.40 9.10/10.40 4.7 MCLR (Overnight) 8.00/8.60 7.95/8.50 7.95/8.50 8.15/8.45 8.15/8.45 4.8 Term Deposit Rate >1 Year 6.50/7.25 6.00/7.25 6.50/7.25 6.00/7.25 6.00/7.25 4.9 Savings Deposit Rate 2.70/3.00 2.70/3.00 2.70/3.00 2.70/3.00 2.70/3.00 4.10 Call Money Rate (Weighted Average) 6.85 6.79 6.81 6.70 6.71 4.11 91-Day Treasury Bill (Primary) Yield - 6.96 6.93 6.49 6.55 4.12 182-Day Treasury Bill (Primary) Yield 7.28 7.16 7.16 6.66 6.70 4.13 364-Day Treasury Bill (Primary) Yield 7.31 7.15 7.13 6.65 6.69 4.14 10-Year G-Sec Par Yield (FBIL) 7.31 7.31 7.20 6.79 6.76 5 Reference Rate and Forward Premia 5.1 INR-US$ Spot Rate (Rs. Per Foreign Currency) 83.37 83.37 83.12 84.50 85.59 5.2 INR-Euro Spot Rate (Rs. Per Foreign Currency) 90.22 90.93 92.00 89.36 89.11 5.3 Forward Premia of US$ 1-month (%) 1.00 0.95 1.23 1.94 3.70 3-month (%) 1.11 1.12 1.65 1.98 2.91 6-month (%) 1.31 1.47 1.51 2.18 2.61 6 Inflation (%) 6.1 All India Consumer Price Index 5.4 5.6 5.7 5.5 5.2 6.2 Consumer Price Index for Industrial Workers 5.19 5.0 4.9 3.9 - 6.3 Wholesale Price Index -0.7 0.4 0.9 2.2 2.4 6.3.1 Primary Articles 3.5 5.2 5.7 5.5 6.0 6.3.2 Fuel and Power -4.7 -4.1 -1.4 -4.0 -3.8 6.3.3 Manufactured Products -1.7 -0.8 -0.8 2.1 2.1 7 Foreign Trade (% Change) 7.1 Imports -5.3 -3.3 -6.6 16.0 4.9 7.2 Exports -3.1 -3.3 0.8 -5.1 -1.0 Note : Financial Benchmark India Pvt. Ltd. (FBIL) has commenced publication of the G-Sec benchmarks with effect from March 31, 2018 as per RBI circularFMRD.DIRD. 7/14.03.025/2017-18 dated March 31, 2018. FBIL has started dissemination of reference rates w.e.f. July 10, 2018. #: Bank credit growth and related ratios for all fortnights from December 3, 2021 to November 18, 2022 are adjusted for past reporting errors by select scheduled commercial banks (SCBs). Figures in parentheses include the impact of merger of a non-bank with a bank. *: As per Press Release No. 2022-2023/41 dated April 08, 2022. RBI Bulletin February 2025 119CURRENT STATISTICS Reserve Bank of India No. 2: RBI - Liabilities and Assets * (₹ Crore) Item As on the Last Friday/ Friday 2024-25 2024 2025 Jan. Jan. 03 Jan. 10 Jan. 17 Jan. 24 Jan. 31 1 2 3 4 5 6 7 1 Issue Department 1.1 Liabilities 1.1.1 Notes in Circulation 3482333 3386320 3525972 3554284 3558938 3564296 3564965 1.1.2 Notes held in Banking Department 11 13 12 11 14 10 12 1.1/1.2 Total Liabilities (Total Notes Issued) or Assets 3482344 3386333 3525984 3554295 3558952 3564306 3564977 1.2 Assets 1.2.1 Gold 162996 149322 203530 206786 211605 212741 217109 1.2.2 Foreign Securities 3318885 3236716 3322233 3347167 3347062 3351157 3347525 1.2.3 Rupee Coin 463 296 221 342 285 407 343 1.2.4 Government of India Rupee Securities - - - - - - - 2 Banking Department 2.1 Liabilities 2.1.1 Deposits 1782333 1734444 1373553 1444233 1399704 1525243 1446595 2.1.1.1 Central Government 101 100 101 101 101 101 101 2.1.1.2 Market Stabilisation Scheme - - - - - - 2.1.1.3 State Governments 42 42 42 42 42 42 42 2.1.1.4 Scheduled Commercial Banks 1008618 933808 908538 930602 897242 889895 924083 2.1.1.5 Scheduled State Co-operative Banks 10092 8039 8502 7814 7798 7918 7772 2.1.1.6 Non-Scheduled State Co-operative Banks 6412 4935 4887 4744 4638 4701 4567 2.1.1.7 Other Banks 48725 47419 45270 45584 45309 45901 46275 2.1.1.8 Others 545400 593671 322155 350161 333913 463478 362067 2.1.1.9 Financial Institution Outside India 162944 146428 84056 105184 110661 113207 101688 2.1.2 Other Liabilities 1804747 1732677 1926522 1926074 1989935 2002933 2034572 2.1/2.2 Total Liabilities or Assets 3587080 3467121 3300075 3370307 3389639 3528176 3481167 2.2 Assets 2.2.1 Notes and Coins 11 13 12 11 14 10 12 2.2.2 Balances Held Abroad 1480408 1345848 1392917 1296048 1306132 1320797 1344426 2.2.3 Loans and Advances 2.2.3.1 Central Government - - - - - - - 2.2.3.2 State Governments 2300 12810 36637 14620 23623 20495 19332 2.2.3.3 Scheduled Commercial Banks 266021 337637 130502 292649 262197 354098 256989 2.2.3.4 Scheduled State Co-op.Banks - - - - - - - 2.2.3.5 Industrial Dev. Bank of India - - - - - - - 2.2.3.6 NABARD - - - - - - - 2.2.3.7 EXIM Bank - - - - - - - 2.2.3.8 Others 12398 3174 7917 8546 13918 20797 20988 2.2.3.9 Financial Institution Outside India 162650 145120 83484 104009 109927 112893 101053 2.2.4 Bills Purchased and Discounted 2.2.4.1 Internal - - - - - - - 2.2.4.2 Government Treasury Bills - - - - - - - 2.2.5 Investments 1365425 1360963 1256837 1257276 1267735 1290478 1319974 2.2.6 Other Assets 297868 261555 391769 397148 406092 408607 418394 2.2.6.1 Gold 272028 245322 372000 376786 385567 387637 396899 * Data are provisional. 120 RBI Bulletin February 2025CURRENT STATISTICS No. 3: Liquidity Operations by RBI (₹ Crore) Date Standing OMO (Outright) Net Injection (+)/ Liquidity Absorption (-) Liquidity Adjustment Facility Facilities (1+3+5+7+9-2-4-6 -8) Sale Purchase Variable Variable Reverse Rate Repo Rate MSF SDF Repo Reverse Repo Repo 1 2 3 4 5 6 7 8 9 10 Dec. 1, 2024 - - - - 2145 40879 - - - -38734 Dec. 2, 2024 - - - - 1450 99633 - - - -98183 Dec. 3, 2024 - - - - 1246 108694 -1501 - - -108949 Dec. 4, 2024 - - - - 3287 75455 -968 - - -73136 Dec. 5, 2024 - - - - 5041 54725 1051 - - -48633 Dec. 6, 2024 - - - - 7066 76733 1199 - - -68468 Dec. 7, 2024 - - - - 5179 57178 - - - -51999 Dec. 8, 2024 - - - - 59 44956 - - - -44897 Dec. 9, 2024 - - 40630 - 826 73311 - - - -31855 Dec. 10, 2024 - - - - 8844 53024 - - - -44180 Dec. 11, 2024 - - 25005 - 5314 85961 - - - -55642 Dec. 12, 2024 - - - - 1231 98910 - - - -97679 Dec. 13, 2024 - - 75004 - 31070 140196 - - - -34122 Dec. 14, 2024 - - - - 21036 75236 - - - -54200 Dec. 15, 2024 - - - - 17896 89924 - - - -72028 Dec. 16, 2024 - - 75775 - 24824 76241 - - - 24358 Dec. 17, 2024 - - 73193 - 295 90072 - - - -16584 Dec. 18, 2024 - - - - 1734 61125 -1439 - - -60830 Dec. 19, 2024 - - - - 3280 52003 1016 - - -47707 Dec. 20, 2024 - - 150004 - 4838 64844 674 - - 90672 Dec. 21, 2024 - - - - 13552 50583 - - - -37031 Dec. 22, 2024 - - - - 11972 46614 - - - -34642 Dec. 23, 2024 - - 111281 - 258 104798 - - - 6741 Dec. 24, 2024 - - 37953 - 314 105859 - - - -67592 Dec. 25, 2024 - - - - 9210 99023 - - - -89813 Dec. 26, 2024 - - - - 913 119377 - - - -118464 Dec. 27, 2024 - - 213570 - 31127 61909 - - 20 182808 Dec. 28, 2024 - - - - 17087 48120 - - - -31033 Dec. 29, 2024 - - - - 16460 50576 - - - -34116 Dec. 30, 2024 - - 83238 - 385 99913 - - - -16290 Dec. 31, 2024 - - 50004 - 298 138004 8375 - - -79327 RBI Bulletin February 2025 121CURRENT STATISTICS No. 4: Sale/ Purchase of U.S. Dollar by the RBI i) Operations in onshore / offshore OTC segment Item 2023 2024 2023-24 Dec. Nov. Dec. 1 2 3 4 1 Net Purchase/ Sale of Foreign Currency (US $ Million) (1.1-1.2) 41271 2067 -20228 -15150 1.1 Purchase (+) 194296 31730 30880 53898 1.2 Sale (–) 153025 29663 51108 69048 2 ₹ equivalent at contract rate (₹ Crores) 339528 17234 -170630 -128753 3 Cumulative (over end-March) (US $ Million) 41271 17515 -20956 -36106 (₹ Crore) 339528 142319 -177653 -306406 4 Outstanding Net Forward Sales (-)/ Purchase (+) at the end of month (US -541 2184 -58850 -67938 $ Million) ii) Operations in currency futures segment Item 2023 2024 2023-24 Dec. Nov. Dec. 1 2 3 4 1 Net Purchase/ Sale of Foreign Currency (US $ Million) (1.1-1.2) 0 0 0 0 1.1 Purchase (+) 7930 1397 3926 3552 1.2 Sale (–) 7930 1397 3926 3552 2 Outstanding Net Currency Futures Sales (-)/ Purchase (+) at the end of -1080 -1558 -2968 -3450 month (US $ Million) 122 RBI Bulletin February 2025CURRENT STATISTICS No. 4 A : Maturity Breakdown (by Residual Maturity) of Outstanding Forwards of RBI (US $ Million) Item As on December 31 , 2024 Long (+) Short (-) Net (1-2) 1 2 3 1. Upto 1 month 250 34060 -33810 2. More than 1 month and upto 3 months 0 24253 -24253 3. More than 3 months and upto 1 year 0 9875 -9875 4. More than 1 year 0 0 0 Total (1+2+3+4) 250 68188 -67938 No. 5: RBI’s Standing Facilities (₹ Crore) Item As on the Last Reporting Friday 2023-24 2024 2025 Jan. 26 Aug. 23 Sep. 20 Oct. 18 Nov. 29 Dec. 27 Jan. 24 1 2 3 4 5 6 7 8 1 MSF 49906 32611 1818 21731 4216 18513 31127 3232 2 Export Credit Refinance for Scheduled Banks 2.1 Limit - - - - - - - - 2.2 Outstanding - - - - - - - - 3 Liquidity Facility for PDs 3.1 Limit 9900 4900 9900 9900 9900 9900 9900 9900 3.2 Outstanding 9810 3174 8541 8547 7223 8428 8459 9556 4 Others 4.1 Limit 76000 76000 76000 76000 76000 76000 76000 76000 4.2 Outstanding - - - - - - - - 5 Total Outstanding (1+2.2+3.2+4.2) 59716 35785 10359 30278 11439 26941 39586 12788 RBI Bulletin February 2025 123CURRENT STATISTICS Money and Banking No. 6: Money Stock Measures (₹ Crore) Item Outstanding as on March 31/last reporting Fridays of the month/ reporting Fridays 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 1 Currency with the Public (1.1 + 1.2 + 1.3 – 1.4) 3410276 3256115 3444217 3476238 3459713 1.1 Notes in Circulation 3477795 3330296 3510709 3535571 3524608 1.2 Circulation of Rupee Coin 32689 31853 34676 34676 34676 1.3 Circulation of Small Coins 743 743 743 743 743 1.4 Cash on Hand with Banks 101185 106881 102752 95625 101225 2 Deposit Money of the Public 2681424 2661541 2821629 2850537 2812342 2.1 Demand Deposits with Banks 2586888 2580490 2718636 2751293 2710713 2.2 'Other' Deposits with Reserve Bank 94536 81051 102993 99244 101629 3 M1 (1 + 2) 6091700 5917655 6265846 6326776 6272055 4 Post Office Saving Bank Deposits 195777 216978 200889 200889 200889 5 M2 (3 + 4) 6287477 6134633 6466735 6527665 6472944 6 Time Deposits with Banks 18739918 18338335 20182384 20195916 20240455 (18848160) (18459622) (20251544) (20263731) (20307146) 7 M3 (3 + 6) 24831618 24255990 26448230 26522691 26512510 (24939860) (24377277) (26517391) (26590507) (26579200) 8 Total Post Office Deposits 1313366 1258895 1379283 1379283 1379283 9 M4 (7 + 8) 26144984 25514885 27827513 27901974 27891793 (26253226) (25636172) (27896674) (27969790) (27958483) Figures in parentheses include the impact of merger of a non-bank with a bank. 124 RBI Bulletin February 2025CURRENT STATISTICS No. 7 : Sources of Money Stock (M) 3 (₹ Crore) Sources Outstanding as on March 31/last reporting Fridays of the month/reporting Fridays 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 1 Net Bank Credit to Government 7512016 7171807 8035414 8048578 7850250 1 Net Bank Credit to Government (Including Merger) (7603571) (7272617) (8086633) (8099444) (7901119) 1.1 RBI’s net credit to Government (1.1.1–1.1.2) 1193213 979659 1242346 1239095 1000891 1.1.1 Claims on Government 1370428 1360482 1287452 1301462 1276034 1.1.1.1 Central Government 1363828 1357903 1270987 1272718 1254193 1.1.1.2 State Governments 6600 2579 16465 28744 21841 1.1.2 Government deposits with RBI 177215 380824 45106 62366 275143 1.1.2.1 Central Government 177172 380781 45064 62324 275101 1.1.2.2 State Governments 42 43 42 42 42 1.2 Other Banks’ Credit to Government 6318803 6192149 6793069 6809483 6849360 1.2 Other Banks Credit to Government (Including Merger) (6410358) (6292959) (6844287) (6860349) (6900228) 2 Bank Credit to Commercial Sector 16672145 16136616 17835267 17900969 18090813 2 Bank Credit to Commercial Sector (Including Merger) (17202832) (16709688) (18291281) (18346470) (18529356) 2.1 RBI’s credit to commercial sector 14406 5080 10463 10271 10519 2.2 Other banks’ credit to commercial sector 16657739 16131536 17824804 17890698 18080294 2.2 Other banks credit to commercial sector (Including Merger) (17188426) (16704608) (18280818) (18336199) (18518837) 2.2.1 Bank credit by commercial banks 15901477 15388871 17052942 17141380 17304495 2.2.1 Bank credit by commercial banks (Including Merger) (16432164) (15961944) (17508956) (17586881) (17743037) 2.2.2 Bank credit by co-operative banks 738194 725337 753253 730523 757258 2.2.3 Investments by commercial and co-operative banks in other securities 18068 17327 18610 18794 18541 2.2.3 Investments by commercial and co-operative banks in other securities (Including Merger) (18068) (17327) (18610) (18794) (18541) 3 Net Foreign Exchange Assets of Banking Sector (3.1 + 3.2) 5567245 5337666 5775605 5750833 5690829 3.1 RBIs net foreign exchange assets (3.1.1 - 3.1.2) 5240824 5038109 5408898 5384126 5324122 3.1.1 Gross foreign assets 5241083 5038371 5409166 5384388 5324384 3.1.2 Foreign liabilities 259 261 268 262 262 3.2 Other banks’ net foreign exchange assets 326421 299557 366707 366707 366707 4 Government’s Currency Liabilities to the Public 33432 32596 35419 35419 35419 5 Banking Sector’s Net Non-monetary Liabilities 4953219 4422695 5233476 5213108 5154801 5 Banking Sectors Net Non-monetary Liabilities (Including Merger) (5467219) (4975291) (5671548) (5641660) (5577522) 5.1 Net non-monetary liabilities of RBI 1789875 1792947 1901186 1915858 1890916 5.2 Net non-monetary liabilities of other banks (residual) 3163344 2629748 3332290 3297250 3263885 5.2 Net non-monetary liabilities of other banks (residual) (Including Merger) (3677343) (3182344) (3770362) (3725802) (3686606) M₃(1+2+3+4–5) 24831618 24255990 26448230 26522691 26512510 M3 (1+2+3+4-5) (Including Merger) (24939860) (24377277) (26517391) (26590507) (26579200) Figures in parentheses include the impact of merger of a non-bank with bank. RBI Bulletin February 2025 125CURRENT STATISTICS No. 8: Monetary Survey (₹ Crore) Item Outstanding as on March 31/last reporting Fridays of the month/reporting Fridays 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 Monetary Aggregates NM₁ (1.1+1.2.1+1.3) 6091700 5917655 6265846 6326776 6272318 NM₂ (NM₁ + 1.2.2.1) 14424855 14081095 15223357 15287032 15252461 NM2 (NM1 + 1.2.2.1) (Including Merger) (14473564) (14135674) (15254479) (15317549) (15282471) NM₃ (NM₂ +1.2.2.2 + 1.4 = 2.1 + 2.2 + 2.3 – 2.4 – 2.5) 25387764 24817697 27122450 27105392 27183290 NM3 (NM2 + 1.2.2.2 + 1.4 = 2.1 + 2.2 + 2.3 - 2.4 - 2.5) (Including Merger) (25496006) (24938984) (27191610) (27173207) (27249981) 1 Components 1.1 Currency with the Public 3410276 3256115 3444217 3476238 3459977 1.2 Aggregate Deposits of Residents 21105009 20721466 22624216 22662975 22666584 1.2 Aggregate Deposits of Residents (Including Merger) (21213252) (20842754) (22693377) (22730790) (22733275) 1.2.1 Demand Deposits 2586888 2580490 2718636 2751293 2710713 1.2.2 Time Deposits of Residents 18518121 18140977 19905580 19911682 19955872 1.2.2 Time Deposits of Residents (Including Merger) (18626364) (18262264) (19974741) (19979497) (20022562) 1.2.2.1 Short-term Time Deposits 8333155 8163440 8957511 8960257 8980142 1.2.2.1 Short-term Time Deposits (Including Merger) (8381864) (8218019) (8988633) (8990774) (9010153) 1.2.2.1.1 Certificates of Deposits (CDs) 369399 342514 493598 484414 499061 1.2.2.2 Long-term Time Deposits 10184967 9977537 10948069 10951425 10975729 1.2.2.2 Long-term Time Deposits (Including Merger) (10244500) (10044245) (10986107) (10988724) (11012409) 1.3 'Other' Deposits with RBI 94536 81051 102993 99244 101629 1.4 Call/Term Funding from Financial Institutions 777942 759065 951023 866935 955100 2 Sources 2.1 Domestic Credit 25295986 24396448 27060933 27154284 27103156 2.1 Domestic Credit (Including Merger) (25918227) (25070331) (27568166) (27650651) (27592567) 2.1.1 Net Bank Credit to the Government 7512016 7171807 8035414 8048578 7850250 2.1.1 Net Bank Credit to the Government (Including Merger) (7603571) (7272617) (8086633) (8099444) (7901119) 2.1.1.1 Net RBI credit to the Government 1193213 979659 1242346 1239095 1000891 2.1.1.2 Credit to the Government by the Banking System 6318803 6192149 6793069 6809483 6849360 2.1.1.2 Credit to the Government by the Banking System (Including Merger) (6410358) (6292959) (6844287) (6860349) (6900228) 2.1.2 Bank Credit to the Commercial Sector 17783970 17224641 19025519 19105706 19252905 2.1.2 Bank Credit to the Commercial Sector (Including Merger) (18314656) (17797714) (19481533) (19551207) (19691448) 2.1.2.1 RBI Credit to the Commercial Sector 14406 5080 10463 10271 10519 2.1.2.2 Credit to the Commercial Sector by the Banking System 17769564 17219561 19015056 19095435 19242386 2.1.2.2 Credit to the Commercial Sector by the Banking System (Including Merger) (18300250) (17792634) (19471070) (19540936) (19680929) 2.1.2.2.1 Other Investments ( Non-SLR Securities) 1089184 1074161 1177017 1189721 1146977 2.2 Government's Currency Liabilities to the Public 33432 32596 35419 35419 35683 2.3 Net Foreign Exchange Assets of the Banking Sector 5110820 4977214 5289237 5372827 5300111 2.3.1 Net Foreign Exchange Assets of the RBI 5240824 5038109 5408898 5384126 5324122 2.3.2 Net Foreign Currency Assets of the Banking System -130004 -60896 -119661 -11299 -24011 2.4 Capital Account 3912897 4020302 4401596 4397734 4396751 2.5 Other items (net) 1653576 1120855 1299617 1487955 1281628 Figures in parentheses include the impact of merger of a non-bank with a bank. 126 RBI Bulletin February 2025CURRENT STATISTICS No. 9: Liquidity Aggregates (₹ Crore) Aggregates 2023-24 2023 2024 Dec. Oct. Nov. Dec. 1 2 3 4 5 1 NM₃ 25387764 24817697 26808015 27122450 27183290 (25496006) (24938984) (26880587) (27191610) (27249981) 2 Postal Deposits 729246 708478 732774 732774 732774 3 L₁ ( 1 + 2) 26117010 25526175 27540789 27855224 27916064 (26225252) (25647462) (27613361) (27924384) (27982755) 4 Liabilities of Financial Institutions 85150 68815 68842 66263 73559 4.1 Term Money Borrowings 2375 1305 31 26 16 4.2 Certificates of Deposit 70245 54485 55520 52765 59920 4.3 Term Deposits 12531 13025 13291 13473 13622 5 L₂ (3 + 4) 26202160 25594990 27609631 27921487 27989623 (26310403) (25716277) (27682202) (27990647) (28056313) 6 Public Deposits with Non-Banking Financial Companies 102994 101152 .. .. 102994 7 L₃ (5 + 6) 26305155 25696142 .. .. 28092617 Note : 1. Figures in the columns might not add up to the total due to rounding off of numbers. 2. Figures in parentheses include the impact of merger of a non-bank with a bank. RBI Bulletin February 2025 127CURRENT STATISTICS No. 10: Reserve Bank of India Survey (₹ Crore) Item Outstanding as on March 31/last reporting Fridays of the month/reporting Fridays 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 1 Components 1.1 Currency in Circulation 3511461 3362995 3546969 3571864 3561202 1.2 Bankers’ Deposits with the RBI 1025449 1001281 1087967 1050455 1000260 1.2.1 Scheduled Commercial Banks 956011 939847 1023815 986172 939428 1.3 ‘Other’ Deposits with the RBI 94536 81051 102993 99244 101629 Reserve Money (1.1 + 1.2 + 1.3 = 2.1 + 2.2 + 2.3 – 2.4 – 2.5) 4631446 4445327 4737929 4721563 4663090 2 Sources 2.1 RBI’s Domestic Credit 1147066 1167569 1194797 1217875 1194202 2.1.1 Net RBI credit to the Government 1193213 979659 1242346 1239095 1000891 2.1.1.1 Net RBI credit to the Central Government (2.1.1.1.1 + 2.1.1.1.2 + 2.1.1.1.3 + 2.1.1.1.4 – 2.1.1.1.5) 1186655 977122 1225923 1210394 979092 2.1.1.1.1 Loans and Advances to the Central Government - - - - - 2.1.1.1.2 Investments in Treasury Bills - - - - - 2.1.1.1.3 Investments in dated Government Securities 1363369 1357627 1270656 1272522 1253916 2.1.1.1.3.1 Central Government Securities 1363369 1357627 1270656 1272522 1253916 2.1.1.1.4 Rupee Coins 459 276 330 196 278 2.1.1.1.5 Deposits of the Central Government 177172 380781 45064 62324 275101 2.1.1.2 Net RBI credit to State Governments 6557 2537 16423 28701 21798 2.1.2 RBI’s Claims on Banks -60553 182830 -58011 -31491 182792 2.1.2.1 Loans and Advances to Scheduled Commercial Banks -60553 182830 -58011 -31491 182792 2.1.3 RBI’s Credit to Commercial Sector 14406 5080 10463 10271 10519 2.1.3.1 Loans and Advances to Primary Dealers 9358 3167 8428 8209 8459 2.1.3.2 Loans and Advances to NABARD - - - - - 2.2 Government’s Currency Liabilities to the Public 33432 32596 35419 35419 35683 2.3 Net Foreign Exchange Assets of the RBI 5240824 5038109 5408898 5384126 5324122 2.3.1 Gold 439319 402148 565949 577133 566843 2.3.2 Foreign Currency Assets 4801522 4635979 4842966 4807011 4757296 2.4 Capital Account 1589134 1727402 1812747 1808345 1803583 2.5 Other Items (net) 200741 65545 88439 107514 87333 No. 11: Reserve Money - Components and Sources (₹ Crore) Item Outstanding as on March 31/last Fridays of the month/Fridays 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 1 2 3 4 5 6 7 Reserve Money (1.1 + 1.2 + 1.3 = 2.1 + 2.2 + 2.3 + 2.4 + 2.5 – 2.6) 4631446 4445327 4737929 4758974 4721563 4711531 4663090 1 Components 1.1 Currency in Circulation 3511461 3362995 3546969 3562515 3571864 3562017 3561202 1.2 Bankers' Deposits with RBI 1025449 1001281 1087967 1097391 1050455 1047111 1000260 1.3 ‘Other’ Deposits with RBI 94536 81051 102993 99069 99244 102403 101629 2 Sources 2.1 Net Reserve Bank Credit to Government 1193213 979659 1242346 1317861 1239095 1026598 1000891 2.2 Reserve Bank Credit to Banks -60553 182830 -58011 -69168 -31491 167651 182792 2.3 Reserve Bank Credit to Commercial Sector 14406 5080 10463 10077 10271 10404 10519 2.4 Net Foreign Exchange Assets of RBI 5240824 5038109 5408898 5393378 5384126 5326888 5324122 2.5 Government's Currency Liabilities to the Public 33432 32596 35419 35419 35419 35419 35683 2.6 Net Non- Monetary Liabilities of RBI 1789875 1792947 1901186 1928593 1915858 1855429 1890916 128 RBI Bulletin February 2025CURRENT STATISTICS No. 12: Commercial Bank Survey (₹ Crore) Item Outstanding as on last reporting Fridays of the month/ reporting Fridays of the month 2023-24 2023 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 1 Components 1.1 Aggregate Deposits of Residents 20145188 19769396 21671501 21716094 21711317 (20253430) (19890683) (21740662) (21783910) (21778008) 1.1.1 Demand Deposits 2443853 2437504 2576789 2610222 2569573 1.1.2 Time Deposits of Residents 17701334 17331892 19094713 19105873 19141745 (17809577) (17453179) (19163873) (19173688) (19208435) 1.1.2.1 Short-term Time Deposits 7965600 7799351 8592621 8597643 8613785 1.1.2.1.1 Certificates of Deposits (CDs) 369399 342514 493598 484414 499061 1.1.2.2 Long-term Time Deposits 9735734 9532541 10502092 10508230 10527960 1.2 Call/Term Funding from Financial Institutions 777942 759065 951023 866935 955100 2 Sources 2.1 Domestic Credit 23019606 22357890 24722187 24843409 25002766 (23641847) (23031773) (25229419) (25339776) (25492177) 2.1.1 Credit to the Government 6014054 5888955 6487128 6505486 6544381 (6105610) (5989765) (6538347) (6556353) (6595249) 2.1.2 Credit to the Commercial Sector 17005551 16468935 18235059 18337922 18458385 (17536238) (17042007) (18691073) (18783423) (18896928) 2.1.2.1 Bank Credit 15901477 15388871 17052942 17141380 17304495 (16432164) (15961944) (17508956) (17586881) (17743037) 2.1.2.1.1 Non-food Credit 15878397 15345733 17001688 17089074 17248356 (16409083) (15918805) (17457702) (17534575) (17686899) 2.1.2.2 Net Credit to Primary Dealers 22904 14127 13498 15279 15378 2.1.2.3 Investments in Other Approved Securities 949 737 565 504 498 2.1.2.4 Other Investments (in non-SLR Securities) 1080222 1065199 1168055 1180758 1138015 2.2 Net Foreign Currency Assets of Commercial Banks (2.2.1-2.2.2-2.2.3) -130004 -60896 -119661 -11299 -24011 2.2.1 Foreign Currency Assets 241661 258410 339002 444723 443646 2.2.2 Non-resident Foreign Currency Repatriable Fixed Deposits 221796 197358 276804 284234 284584 2.2.3 Overseas Foreign Currency Borrowings 149868 121947 181858 171789 183074 2.3 Net Bank Reserves (2.3.1+2.3.2-2.3.3) 893350 852099 1172693 1101641 845902 2.3.1 Balances with the RBI 931483 939847 1023815 986172 939428 2.3.2 Cash in Hand 89433 95082 90867 83978 89267 2.3.3 Loans and Advances from the RBI 127566 182830 -58011 -31491 182792 2.4 Capital Account 2299592 2268729 2564679 2565219 2568998 2.5 Other items (net) (2.1+2.2+2.3-2.4-1.1-1.2) 560230 351904 588016 785503 589242 2.5.1 Other Demand and Time Liabilities (net of 2.2.3) 787560 815183 839816 971762 813552 2.5.2 Net Inter-Bank Liabilities (other than to PDs) 197781 174722 135044 132994 132284 Figures in parentheses include the impact of merger of a non-bank with a bank. No. 13: Scheduled Commercial Banks’ Investments (₹ Crore) Item As on 2023 2024 March 22, 2024 Dec. 29 Nov. 29 Dec. 13 Dec. 27 1 2 3 4 5 1 SLR Securities 6106558 5990503 6538915 6556857 6595747 (6015003) (5889692) (6487697) (6505991) (6544879) 2 Other Government Securities (Non-SLR) 177136 180084 157432 157393 157392 3 Commercial Paper 61175 57466 60547 60586 60991 4 Shares issued by 4.1 PSUs 8475 8751 13340 13369 13268 4.2 Private Corporate Sector 77722 81517 96761 96620 97535 4.3 Others 5624 5605 7503 7491 7490 5 Bonds/Debentures issued by 5.1 PSUs 103070 94289 121897 122634 127626 5.2 Private Corporate Sector 287596 289204 231855 231302 232626 5.3 Others 124690 111242 155237 155052 157698 6 Instruments issued by 6.1 Mutual funds 62499 56810 134778 147641 92068 6.2 Financial institutions 172340 181283 188704 188670 191321 RBI Bulletin February 2025 129CURRENT STATISTICS No. 14: Business in India - All Scheduled Banks and All Scheduled Commercial Banks (₹ Crore) Item As on the Last Reporting Friday (in case of March)/ Last Friday All Scheduled Banks All Scheduled Commercial Banks 2023 2024 2023 2024 2023-24 2023-24 Dec. Nov. Dec. Dec. Nov. Dec. 1 2 3 4 5 6 7 8 Number of Reporting Banks 210 210 208 208 137 137 135 135 1 Liabilities to the Banking System 554117 528876 441174 461496 549351 524747 436037 456515 1.1 Demand and Time Deposits from Banks 298452 269437 278500 296174 294471 266043 273722 291575 1.2 Borrowings from Banks 182566 189114 137620 138393 182429 189078 137597 138334 1.3 Other Demand and Time Liabilities 73100 70324 25053 26929 72452 69626 24718 26606 2 Liabilities to Others 22664868 22240106 24464102 24491884 22190597 21784236 23990270 24014317 2.1 Aggregate Deposits 20932067 20525354 22473475 22522349 20475226 20088041 22017466 22062591 (20823825) (20404067) (22404315) (22455658) (20366984) (19966754) (21948305) (21995901) 2.1.1 Demand 2492916 2485497 2625490 2617452 2443853 2437504 2576789 2569573 2.1.2 Time 18439151 18039857 19847985 19904896 18031373 17650537 19440677 19493019 2.2 Borrowings 782260 763584 955899 959775 777942 759065 951023 955100 2.3 Other Demand and Time Liabilities 950541 951168 1034728 1009761 937428 937130 1021781 996626 3 Borrowings from Reserve Bank 222716 271352 21293 244697 222716 271352 21293 244697 3.1 Against Usance Bills /Promissory Notes - - - - - - - - 3.2 Others 222716 271352 21293 244697 222716 271352 21293 244697 4 Cash in Hand and Balances with Reserve Bank 1043272 1056932 1137407 1051004 1020916 1034929 1114682 1028694 4.1 Cash in Hand 91886 97605 93455 91928 89433 95082 90867 89267 4.2 Balances with Reserve Bank 951386 959326 1043952 959076 931483 939847 1023815 939428 5 Assets with the Banking System 455057 430787 379361 410612 374474 364152 314490 339609 5.1 Balances with Other Banks 246384 247269 247862 271169 198327 202063 195672 216738 5.1.1 In Current Account 12010 13515 12102 16333 8971 10360 9524 13938 5.1.2 In Other Accounts 234373 233755 235760 254836 189357 191703 186147 202800 5.2 Money at Call and Short Notice 39614 34891 27828 30173 12355 17201 19091 18342 5.3 Advances to Banks 51325 45516 39301 42099 48368 44105 38641 40682 5.4 Other Assets 117734 103111 64369 67172 115424 100782 61086 63847 6 Investment 6256962 6139074 6691504 6747371 6106558 5990503 6538915 6595747 (6165407) (6038263) (6640285) (6696503) (6015003) (5889692) (6487697) (6544879) 6.1 Government Securities 6249319 6132448 6683596 6739533 6105610 5989765 6538351 6595249 6.2 Other Approved Securities 7643 6625 7908 7839 949 737 565 498 7 Bank Credit 16866336 16386269 17959742 18194821 16432164 15961944 17508956 17743037 (16335650) (15813197) (17503728) (17756278) (15901477) (15388871) (17052942) (17304495) 7a Food Credit 75472 92344 101871 106755 23081 43139 51254 56139 7.1 Loans, Cash-credits and Overdrafts 16565348 16094103 17646243 17870643 16134303 15672642 17198615 17422048 7.2 Inland Bills-Purchased 60471 52280 69789 73546 60467 52269 68351 72063 7.3 Inland Bills-Discounted 199761 198816 206353 212904 197358 196536 205253 211819 7.4 Foreign Bills-Purchased 16662 17624 15424 15770 16412 17404 15186 15551 7.5 Foreign Bills-Discounted 24094 23446 21934 21957 23624 23093 21550 21557 130 RBI Bulletin February 2025CURRENT STATISTICS No. 15: Deployment of Gross Bank Credit by Major Sectors (₹ Crore) Outstanding as on Growth(%) Mar. 22, Financial Sector 2024 2023 2024 year so far Y-o-Y Dec. 29 Nov. 29 Dec. 27 2024-25 2024 1 2 3 4 % % I. Bank Credit (II + III) 16432164 15961944 17509171 17742873 8.0 11.2 (15901477) (15388871) (17053157) (17304330) (8.8) (12.4) II. Food Credit 23081 43139 51254 56139 143.2 30.1 III. Non-food Credit 16409083 15918805 17457917 17686734 7.8 11.1 (15878397) (15345733) (17001903) (17248192) (8.6) (12.4) 1. Agriculture & Allied Activities 2071251 1991008 2223467 2239028 8.1 12.5 2. Industry (Micro and Small, Medium and Large) 3652804 3594212 3813094 3854429 5.5 7.2 (3635810) (3576973) (3798411) (3842044) (5.7) (7.4) 2.1 Micro and Small 726315 702319 757300 771039 6.2 9.8 2.2 Medium 303998 290336 340525 348108 14.5 19.9 2.3 Large 2622490 2601557 2715269 2735282 4.3 5.1 3. Services 4592227 4443778 4853884 4962520 8.1 11.7 (4490467) (4324463) (4775839) (4888308) (8.9) (13.0) 3.1 Transport Operators 230175 223095 249795 252966 9.9 13.4 3.2 Computer Software 25917 26706 31348 31582 21.9 18.3 3.3 Tourism, Hotels & Restaurants 77513 76621 79088 80218 3.5 4.7 3.4 Shipping 7067 6976 7521 7102 0.5 1.8 3.5 Aviation 43248 44326 46446 45979 6.3 3.7 3.6 Professional Services 167234 156386 184913 189578 13.4 21.2 3.7 Trade 1025752 974551 1081553 1111227 8.3 14.0 3.7.1. Wholesale Trade¹ 538744 506039 568471 584857 8.6 15.6 3.7.2 Retail Trade 487008 468512 513082 526370 8.1 12.3 3.8 Commercial Real Estate 469013 458080 514894 520913 11.1 13.7 (400470) (373674) (461690) (470949) (17.6) (26.0) 3.9 Non-Banking Financial Companies (NBFCs)² of which, 1548027 1520234 1575306 1621767 4.8 6.7 3.9.1 Housing Finance Companies (HFCs) 325626 328787 322240 319910 -1.8 -2.7 3.9.2 Public Financial Institutions (PFIs) 226963 212038 196793 218657 -3.7 3.1 3.10 Other Services³ 998281 956803 1083020 1101188 10.3 15.1 (978198) (935526) (1066187) (1084711) (10.9) (15.9) 4. Personal Loans 5331290 5173253 5734856 5794866 8.7 12.0 (4919468) (4737443) (5372892) (5442956) (10.6) (14.9) 4.1 Consumer Durables 23713 24284 24698 24012 1.3 -1.1 4.2 Housing 2718715 2637781 2908672 2931739 7.8 11.1 (2331935) (2228347) (2568430) (2601206) (11.5) (16.7) 4.3 Advances against Fixed Deposits 125239 118330 131221 140998 12.6 19.2 4.4 Advances to Individuals against share & bonds 8492 8025 8274 9791 15.3 22.0 4.5 Credit Card Outstanding 257016 251843 288997 291087 13.3 15.6 4.6 Education 119380 114955 131629 133140 11.5 15.8 4.7 Vehicle Loans 573398 563475 605587 613302 7.0 8.8 4.8 Loan against gold jewellery⁴ 102562 100723 164556 172581 68.3 71.3 4.9 Other Personal Loans 1402775 1353837 1471222 1478217 5.4 9.2 (1377966) (1327844) (1449564) (1456900) (5.7) (9.7) 5. Priority Sector (Memo) (i) Agriculture & Allied Activities⁵ 2081856 2005383 2210312 2236648 7.4 11.5 (ii) Micro & Small Enterprises⁶ 1974191 1914264 2092196 2145252 8.7 12.1 (iii) Medium Enterprises⁷ 490703 469534 556186 575433 17.3 22.6 (iv) Housing 755222 747897 752576 751317 -0.5 0.5 (660572) (649904) (667694) (667336) (1.0) (2.7) (v) Education Loans 62235 61823 62645 62993 1.2 1.9 (vi) Renewable Energy 5991 5389 7458 8034 34.1 49.1 (vii) Social Infrastructure 2613 2567 1095 999 -61.8 -61.1 (viii) Export Credit 12855 12411 12668 12352 -3.9 -0.5 (ix) Others 61336 53282 54682 55134 -10.1 3.5 (x) Weaker Sections including net PSLC- SF/MF 1647778 1571355 1734996 1748608 6.1 11.3 RBI Bulletin February 2025 131CURRENT STATISTICS No. 16: Industry-wise Deployment of Gross Bank Credit (₹ Crore) Outstanding as on Growth(%) Financial 2023 2024 Y-o-Y Mar. 22, year so far Industry 2024 Dec. 29 Nov. 29 Dec. 27 2024-25 2024 1 2 3 4 % % 2 Industries (2.1 to 2.19) 3652804 3594212 3813094 3854429 5.5 7.2 (3635810) (3576973) (3798411) (3842044) (5.7) (7.4) 2.1 Mining & Quarrying (incl. Coal) 54166 54890 53357 53892 -0.5 -1.8 2.2 Food Processing 208864 191449 197552 211986 1.5 10.7 2.2.1 Sugar 26383 16773 16925 19889 -24.6 18.6 2.2.2 Edible Oils & Vanaspati 19700 21411 20296 21798 10.7 1.8 2.2.3 Tea 5692 5952 6509 6470 13.7 8.7 2.2.4 Others 157089 147313 153822 163829 4.3 11.2 2.3 Beverage & Tobacco 31136 28296 30182 30669 -1.5 8.4 2.4 Textiles 256048 250038 259458 264055 3.1 5.6 2.4.1 Cotton Textiles 99199 95797 95498 98163 -1.0 2.5 2.4.2 Jute Textiles 4280 4187 4295 4340 1.4 3.6 2.4.3 Man-Made Textiles 45111 45396 47526 48251 7.0 6.3 2.4.4 Other Textiles 107458 104657 112138 113303 5.4 8.3 2.5 Leather & Leather Products 12588 12131 12519 12804 1.7 5.5 2.6 Wood & Wood Products 23839 23384 25805 26601 11.6 13.8 2.7 Paper & Paper Products 46426 45500 51174 51508 10.9 13.2 2.8 Petroleum, Coal Products & Nuclear Fuels 132356 131320 144756 139840 5.7 6.5 2.9 Chemicals & Chemical Products 249347 246363 263302 263647 5.7 7.0 2.9.1 Fertiliser 37569 36026 31143 31829 -15.3 -11.6 2.9.2 Drugs & Pharmaceuticals 81036 80276 87569 88026 8.6 9.7 2.9.3 Petro Chemicals 23157 22774 30373 26038 12.4 14.3 2.9.4 Others 107584 107287 114217 117754 9.5 9.8 2.10 Rubber, Plastic & their Products 90420 87677 97032 98914 9.4 12.8 2.11 Glass & Glassware 12090 11347 12517 12507 3.5 10.2 2.12 Cement & Cement Products 59757 60244 61614 61541 3.0 2.2 2.13 Basic Metal & Metal Product 384447 382538 428244 432757 12.6 13.1 2.13.1 Iron & Steel 273803 270611 304598 306185 11.8 13.1 2.13.2 Other Metal & Metal Product 110645 111927 123647 126572 14.4 13.1 2.14 All Engineering 196643 190076 223986 227079 15.5 19.5 2.14.1 Electronics 43175 42761 52123 50108 16.1 17.2 2.14.2 Others 153468 147315 171863 176972 15.3 20.1 2.15 Vehicles, Vehicle Parts & Transport Equipment 113185 110441 113753 115180 1.8 4.3 2.16 Gems & Jewellery 84860 88740 87031 87797 3.5 -1.1 2.17 Construction 133520 131979 142057 143789 7.7 8.9 2.18 Infrastructure 1304096 1301712 1312607 1314369 0.8 1.0 2.18.1 Power 644042 645147 651955 656191 1.9 1.7 2.18.2 Telecommunications 138192 140178 122704 124624 -9.8 -11.1 2.18.3 Roads 318072 316917 333166 325833 2.4 2.8 2.18.4 Airports 7280 7184 8407 8733 20.0 21.6 2.18.5 Ports 6681 6891 6116 6282 -6.0 -8.8 2.18.6 Railways 13062 11439 11376 13325 2.0 16.5 2.18.7 Other Infrastructure 176767 173956 178884 179380 1.5 3.1 2.19 Other Industries 259016 246088 296148 305493 17.9 24.1 Note: (1) Data since July 28, 2023 include the impact of the merger of a non-bank with a bank. Figures in parentheses exclude the impact of the merger. 132 RBI Bulletin February 2025CURRENT STATISTICS No. 17: State Co-operative Banks Maintaining Accounts with the Reserve Bank of India (₹ Crore) Last Reporting Friday (in case of March)/Last Friday/ Item Reporting Friday 2023 2024 2023-24 Nov. 24 Sep. 27 Oct. 04 Oct. 18 Oct. 25 Nov. 01 Nov. 15 Nov. 29 1 2 3 4 5 6 7 8 9 Number of Reporting Banks 33 33 34 34 34 34 34 34 34 1 Aggregate Deposits (2.1.1.2+2.2.1.2) 138788.9 134731.3 133236.7 131961.9 131965.1 132037.8 132552.8 138073.1 138154.1 2 Demand and Time Liabilities 2.1 Demand Liabilities 30226.7 25612.9 27646.4 26781.0 25419.0 25724.0 25854.5 26021.8 26562.1 2.1.1 Deposits 2.1.1.1 Inter-Bank 9101.3 6378.6 7743.1 7544.4 7243.0 7210.1 7147.7 7239.1 6670.1 2.1.1.2 Others 15000.4 13811.7 13473.1 13625.5 13121.6 13179.2 13327.5 13293.6 13187.7 2.1.2 Borrowings from Banks 130.0 299.8 179.9 190.0 639.7 574.6 449.8 1454.3 2.1.3 Other Demand Liabilities 5995.0 5122.8 6250.3 5611.1 4864.4 4695.0 4804.7 5039.2 5249.9 2.2 Time Liabilities 198141.8 172169.3 181476.5 176057.8 177986.9 177577.6 177539.8 178177.3 176625.0 2.2.1 Deposits 2.2.1.1 Inter-Bank 72308.4 49028.6 59406.1 55990.1 56392.3 56169.6 55653.7 51788.5 50047.3 2.2.1.2 Others 123788.5 120919.6 119763.6 118336.4 118843.5 118858.6 119225.3 124779.5 124966.4 2.2.2 Borrowings from Banks 673.6 819.7 1143.3 683.0 1712.2 1460.2 1591.7 651.9 651.9 2.2.3 Other Time Liabilities 1371.3 1401.4 1163.5 1048.5 1038.9 1089.2 1069.1 957.3 959.5 3 Borrowing from Reserve Bank 0.0 0.0 0.0 0.0 4 Borrowings from a notified bank / Government 95914.5 80417.0 87696.9 87889.0 89225.0 88927.0 89398.0 173712.9 112111.7 4.1 Demand 27317.7 21638.3 23412.8 25815.3 25217.3 24980.3 25033.3 102827.6 45109.3 4.2 Time 68596.8 58778.7 64284.1 62074.0 64007.2 64224.1 64364.7 70885.3 67002.4 5 Cash in Hand and Balances with Reserve Bank 16263.7 10725.0 12368.8 12171.0 12371.3 11411.6 13169.8 12004.2 11145.5 5.1 Cash in Hand 960.0 684.5 780.9 781.6 838.2 818.0 828.9 772.6 821.1 5.2 Balance with Reserve Bank 15303.7 10040.5 11587.9 11389.5 11533.2 10593.6 12340.9 11231.6 10324.4 6 Balances with Other Banks in Current Account 2088.1 1598.5 1658.2 1178.6 1229.3 1135.9 1084.0 1035.0 1118.1 7 Investments in Government Securities 77700.5 73325.1 73488.7 74364.4 73111.6 73805.6 74545.3 75275.2 75074.9 8 Money at Call and Short Notice 34355.3 21174.1 15615.3 17561.1 17854.6 16692.6 16150.3 15588.7 12457.8 9 Bank Credit (10.1+11) 135141.9 127421.9 138973.3 135277.0 135003.0 136490.2 136802.8 167629.4 166666.0 10 Advances 10.1 Loans, Cash-Credits and Overdrafts 134936.8 127336.5 138795.8 135082.7 134807.4 136282.1 136593.9 167432.0 166480.4 10.2 Due from Banks 142185.2 125133.8 143516.4 139711.1 141859.4 142706.5 143073.6 113950.8 111546.4 11 Bills Purchased and Discounted 205.1 85.4 177.5 194.2 195.6 208.1 208.9 197.4 185.6 RBI Bulletin February 2025 133CURRENT STATISTICS Prices and Production No. 18: Consumer Price Index (Base: 2012=100) Group/Sub group 2023-24 Rural Urban Combined Rural Urban Combined Jan.24 Dec.24 Jan.25 (P) Jan.24 Dec.24 Jan.25 (P) Jan.24 Dec.24 Jan.25 (P) 1 2 3 4 5 6 7 8 9 10 11 12 1 Food and beverages 185.9 192.7 188.4 187.7 203.9 198.8 194.2 209.4 204.6 190.1 205.9 200.9 1.1 Cereals and products 181.4 181.7 181.5 187.5 198.9 199.8 187.1 196.5 197.5 187.4 198.1 199.1 1.2 Meat and fish 213.0 221.3 215.9 209.9 219.1 220.9 219.4 228.7 230.8 213.2 222.5 224.4 1.3 Egg 185.4 189.5 187.0 204.8 209.8 206.1 206.1 215.8 210.8 205.3 212.1 207.9 1.4 Milk and products 181.4 181.5 181.4 182.6 187.3 187.7 182.8 187.9 188.2 182.7 187.5 187.9 1.5 Oils and fats 165.3 158.7 162.9 161.2 189.0 189.0 155.8 174.6 175.6 159.2 183.7 184.1 1.6 Fruits 172.1 179.9 175.7 169.7 189.0 192.1 174.5 192.4 193.8 171.9 190.6 192.9 1.7 Vegetables 183.9 229.9 199.5 179.9 242.4 203.6 226.2 289.2 245.6 195.6 258.3 217.8 1.8 Pulses and products 192.2 196.5 193.7 202.5 212.4 207.8 207.7 217.4 213.0 204.3 214.1 209.6 1.9 Sugar and confectionery 126.2 128.1 126.9 129.7 130.0 129.6 131.0 132.7 132.4 130.1 130.9 130.5 1.10 Spices 238.0 228.4 234.8 245.9 229.0 227.3 235.5 224.1 222.9 242.4 227.4 225.8 1.11 Non-alcoholic beverages 180.7 168.2 175.5 182.3 186.7 187.7 169.8 175.5 176.6 177.1 182.0 183.1 1.12 Prepared meals, snacks, sweets 193.3 200.9 196.8 195.0 201.2 201.7 203.1 211.7 212.9 198.8 206.1 206.9 2 Pan, tobacco and intoxicants 202.0 207.1 203.3 203.2 208.7 208.2 208.9 212.2 212.6 204.7 209.6 209.4 3 Clothing and footwear 192.9 181.5 188.4 194.6 199.4 199.7 183.1 187.8 188.1 190.0 194.8 195.1 3.1 Clothing 193.5 183.5 189.6 195.3 200.4 200.6 185.1 190.0 190.3 191.3 196.3 196.5 3.2 Footwear 189.4 170.2 181.4 190.4 193.7 193.9 171.8 175.6 176.0 182.7 186.2 186.5 4 Housing -- 176.7 176.7 -- -- -- 177.6 181.7 182.5 177.6 181.7 182.5 5 Fuel and light 183.0 178.9 181.4 184.1 182.3 183.1 175.7 170.5 170.6 180.9 177.8 178.4 6 Miscellaneous 181.7 173.7 177.8 183.4 190.8 191.5 175.2 182.0 182.6 179.4 186.5 187.2 6.1 Household goods and services 181.5 171.8 176.9 182.9 187.0 187.3 173.0 178.3 178.8 178.2 182.9 183.3 6.2 Health 190.8 185.2 188.7 193.2 200.2 200.8 187.8 194.5 195.4 191.2 198.0 198.8 6.3 Transport and communication 171.1 161.4 166.0 172.0 176.7 177.2 162.1 165.8 166.1 166.8 171.0 171.4 6.4 Recreation and amusement 175.8 171.1 173.2 177.2 181.5 181.6 172.2 176.7 177.0 174.4 178.8 179.0 6.5 Education 184.0 179.1 181.1 185.8 192.2 192.5 180.8 187.9 188.0 182.9 189.7 189.9 6.6 Personal care and effects 186.3 187.4 186.8 188.6 206.3 208.4 189.9 208.0 210.2 189.1 207.0 209.1 General Index (All Groups) 185.6 182.4 184.1 187.3 198.4 196.0 183.5 192.0 190.6 185.5 195.4 193.5 Source: National Statistical Office, Ministry of Statistics and Programme Implementation, Government of India. P: Provisional No. 19: Other Consumer Price Indices Item Base Year Linking 2023-24 2023 2024 Factor Dec. Nov. Dec. 1 2 3 4 5 6 1 Consumer Price Index for Industrial Workers 2016 2.88 137.9 138.8 144.5 2 Consumer Price Index for Agricultural Labourers 1986-87 5.89 1229 1257 1320 1320 3 Consumer Price Index for Rural Labourers 1986-87 - 1240 1267 1331 1331 Source: Labour Bureau, Ministry of Labour and Employment, Government of India. No. 20: Monthly Average Price of Gold and Silver in Mumbai Item 2023-24 2023 2024 Dec. Nov. Dec. 1 2 3 4 1 Standard Gold (₹ per 10 grams) 60624 62173 76221 76195 2 Silver (₹ per kilogram) 72243 73926 90230 89265 Source: India Bullion & Jewellers Association Ltd., Mumbai for Gold and Silver prices in Mumbai. 134 RBI Bulletin February 2025CURRENT STATISTICS No. 21: Wholesale Price Index (Base: 2011-12 = 100) Commodities Weight 2023-24 2024 2025 Jan. Nov. Dec.(P) Jan.(P) 1 2 3 4 5 6 1 ALL COMMODITIES 100.000 151.4 151.2 156.4 155.4 154.7 1.1 PRIMARY ARTICLES 22.618 183.0 181.4 197.9 193.8 189.9 1.1.1 FOOD ARTICLES 15.256 191.3 188.8 213.7 207.4 199.9 1.1.1.1 Food Grains (Cereals+Pulses) 3.462 193.8 199.4 214.7 213.8 213.2 1.1.1.2 Fruits & Vegetables 3.475 210.2 189.6 271.9 244.7 210.8 1.1.1.3 Milk 4.440 180.3 182.3 185.2 185.8 187.2 1.1.1.4 Eggs, Meat & Fish 2.402 172.1 168.7 173.1 174.7 174.7 1.1.1.5 Condiments & Spices 0.529 235.4 246.2 244.3 240.2 232.6 1.1.1.6 Other Food Articles 0.948 189.5 196.5 216.8 213.7 217.1 1.1.2 NON-FOOD ARTICLES 4.119 162.4 162.6 162.8 166.3 167.4 1.1.2.1 Fibres 0.839 168.0 162.9 159.4 159.5 161.7 1.1.2.2 Oil Seeds 1.115 185.0 183.1 185.6 182.8 183.0 1.1.2.3 Other non-food Articles 1.960 134.9 133.6 140.1 140.8 142.7 1.1.2.4 Floriculture 0.204 279.7 328.6 270.0 349.3 343.7 1.1.3 MINERALS 0.833 217.7 223.7 229.4 229.6 230.1 1.1.3.1 Metallic Minerals 0.648 204.2 207.3 219.8 219.9 219.1 1.1.3.2 Other Minerals 0.185 265.0 281.0 263.2 263.5 268.8 1.1.4 CRUDE PETROLEUM & NATURAL GAS 2.410 153.6 151.7 146.7 141.9 150.9 1.2 FUEL & POWER 13.152 152.0 154.9 149.9 149.9 150.6 1.2.1 COAL 2.138 136.4 136.2 135.5 135.6 135.6 1.2.1.1 Coking Coal 0.647 143.4 143.4 143.4 143.4 143.4 1.2.1.2 Non-Coking Coal 1.401 124.8 125.8 125.8 125.8 125.8 1.2.1.3 Lignite 0.090 267.6 246.6 230.9 231.2 231.2 1.2.2 MINERAL OILS 7.950 159.0 159.1 154.0 153.9 155.0 1.2.3 ELECTRICITY 3.064 145.0 157.2 149.4 149.4 149.7 1.3 MANUFACTURED PRODUCTS 64.231 140.2 139.7 143.1 143.0 143.2 1.3.1 MANUFACTURE OF FOOD PRODUCTS 9.122 160.5 160.3 177.5 176.7 177.0 1.3.1.1 Processing and Preserving of meat 0.134 145.3 145.6 154.1 155.4 156.8 1.3.1.2 Processing and Preserving of fish, Crustaceans, Molluscs and products thereof 0.204 142.9 140.8 148.9 143.9 145.1 1.3.1.3 Processing and Preserving of fruit and Vegetables 0.138 130.4 128.6 132.7 133.3 132.8 1.3.1.4 Vegetable and Animal oils and Fats 2.643 145.0 140.2 183.2 183.7 186.6 1.3.1.5 Dairy products 1.165 179.1 179.2 182.0 182.0 182.0 1.3.1.6 Grain mill products 2.010 175.6 181.2 190.4 190.2 189.6 1.3.1.7 Starches and Starch products 0.110 157.1 164.2 169.0 165.8 164.5 1.3.1.8 Bakery products 0.215 165.4 166.5 173.1 173.5 174.7 1.3.1.9 Sugar, Molasses & honey 1.163 134.6 137.9 138.1 136.1 138.3 1.3.1.10 Cocoa, Chocolate and Sugar confectionery 0.175 139.8 142.4 160.6 166.6 168.3 1.3.1.11 Macaroni, Noodles, Couscous and Similar farinaceous products 0.026 149.9 150.0 158.1 166.4 161.0 1.3.1.12 Tea & Coffee products 0.371 176.2 161.8 190.2 180.1 161.8 1.3.1.13 Processed condiments & salt 0.163 192.1 199.2 194.5 192.7 193.8 1.3.1.14 Processed ready to eat food 0.024 146.3 147.6 152.8 153.4 155.5 1.3.1.15 Health supplements 0.225 179.1 175.3 192.0 189.0 189.6 1.3.1.16 Prepared animal feeds 0.356 208.3 207.1 205.6 202.3 200.4 1.3.2 MANUFACTURE OF BEVERAGES 0.909 131.5 132.4 134.7 134.6 134.4 1.3.2.1 Wines & spirits 0.408 133.3 134.3 137.1 137.0 136.9 1.3.2.2 Malt liquors and Malt 0.225 135.6 136.8 139.1 139.1 138.9 1.3.2.3 Soft drinks; Production of mineral waters and Other bottled waters 0.275 125.5 125.8 127.7 127.3 127.1 1.3.3 MANUFACTURE OF TOBACCO PRODUCTS 0.514 173.5 174.2 177.0 177.0 177.4 1.3.3.1 Tobacco products 0.514 173.5 174.2 177.0 177.0 177.4 RBI Bulletin February 2025 135CURRENT STATISTICS No. 21: Wholesale Price Index (Contd.) (Base: 2011-12 = 100) Commodities Weight 2023-24 2024 2025 Jan. Nov. Dec.(P) Jan.(P) 1 2 3 4 5 6 1.3.4 MANUFACTURE OF TEXTILES 4.881 134.6 134.0 136.1 136.9 136.9 1.3.4.1 Preparation and Spinning of textile fibres 2.582 120.1 118.7 120.8 120.7 120.6 1.3.4.2 Weaving & Finishing of textiles 1.509 157.5 157.9 158.7 161.4 160.9 1.3.4.3 Knitted and Crocheted fabrics 0.193 120.0 118.0 122.7 123.5 124.1 1.3.4.4 Made-up textile articles, Except apparel 0.299 156.6 157.8 159.7 161.5 161.7 1.3.4.5 Cordage, Rope, Twine and Netting 0.098 139.2 137.5 143.2 144.4 146.1 1.3.4.6 Other textiles 0.201 129.6 130.8 136.8 134.0 136.7 1.3.5 MANUFACTURE OF WEARING APPAREL 0.814 150.8 150.9 153.7 154.4 154.1 1.3.5.1 Manufacture of Wearing Apparel (woven), Except fur Apparel 0.593 148.7 148.5 151.0 151.6 151.4 1.3.5.2 Knitted and Crocheted apparel 0.221 156.6 157.5 161.2 161.8 161.3 1.3.6 MANUFACTURE OF LEATHER AND RELATED PRODUCTS 0.535 124.1 123.5 125.8 125.6 126.3 1.3.6.1 Tanning and Dressing of leather; Dressing and Dyeing of fur 0.142 107.3 103.9 108.1 108.2 108.9 1.3.6.2 Luggage, HandbAgs, Saddlery and Harness 0.075 140.9 141.1 142.6 142.4 142.4 1.3.6.3 Footwear 0.318 127.7 128.1 129.8 129.4 130.3 1.3.7 MANUFACTURE OF WOOD AND PRODUCTS OF WOOD AND CORK 0.772 146.6 148.1 148.5 149.0 149.3 1.3.7.1 Saw milling and Planing of wood 0.124 137.8 136.1 142.9 142.3 141.6 1.3.7.2 Veneer sheets; Manufacture of plywood, Laminboard, Particle board and Other panels and Boards 0.493 146.1 148.6 147.2 148.1 148.7 1.3.7.3 Builder's carpentry and Joinery 0.036 206.4 210.1 214.2 214.6 214.5 1.3.7.4 Wooden containers 0.119 139.8 139.8 139.8 140.0 140.4 1.3.8 MANUFACTURE OF PAPER AND PAPER PRODUCTS 1.113 140.3 138.7 138.5 138.9 139.4 1.3.8.1 Pulp, Paper and Paperboard 0.493 147.6 145.6 143.4 143.1 143.9 1.3.8.2 Corrugated paper and Paperboard and Containers of paper and Paperboard 0.314 140.9 141.6 148.5 148.9 149.6 1.3.8.3 Other articles of paper and Paperboard 0.306 128.0 124.7 120.2 122.0 121.5 1.3.9 PRINTING AND REPRODUCTION OF RECORDED MEDIA 0.676 182.3 184.5 186.7 188.2 189.8 1.3.9.1 Printing 0.676 182.3 184.5 186.7 188.2 189.8 1.3.10 MANUFACTURE OF CHEMICALS AND CHEMICAL PRODUCTS 6.465 136.9 135.4 136.4 136.4 136.7 1.3.10.1 Basic chemicals 1.433 139.9 137.1 138.6 139.3 139.3 1.3.10.2 Fertilizers and Nitrogen compounds 1.485 142.8 141.4 143.5 143.0 143.4 1.3.10.3 Plastic and Synthetic rubber in primary form 1.001 132.3 131.2 133.2 132.8 133.5 1.3.10.4 Pesticides and Other agrochemical products 0.454 132.8 131.2 129.3 128.8 129.2 1.3.10.5 Paints, Varnishes and Similar coatings, Printing ink and Mastics 0.491 143.7 143.2 138.5 139.0 139.2 1.3.10.6 Soap and Detergents, Cleaning and Polishing preparations, Perfumes and Toilet preparations 0.612 139.7 138.9 139.9 140.4 140.4 1.3.10.7 Other chemical products 0.692 134.4 133.5 135.3 134.9 135.0 1.3.10.8 Man-made fibres 0.296 103.6 102.3 103.0 103.9 104.3 1.3.11 MANUFACTURE OF PHARMACEUTICALS, MEDICINAL CHEMICAL AND BOTANICAL PRODUCTS 1.993 142.9 143.0 144.1 144.1 145.0 1.3.11.1 Pharmaceuticals, Medicinal chemical and Botanical products 1.993 142.9 143.0 144.1 144.1 145.0 1.3.12 MANUFACTURE OF RUBBER AND PLASTICS PRODUCTS 2.299 127.5 127.2 128.6 129.1 129.3 1.3.12.1 Rubber Tyres and Tubes; Retreading and Rebuilding of Rubber Tyres 0.609 113.7 113.7 116.7 117.1 116.9 1.3.12.2 Other Rubber Products 0.272 107.3 107.7 111.7 111.9 112.4 1.3.12.3 Plastics products 1.418 137.3 136.8 137.0 137.5 137.9 1.3.13 MANUFACTURE OF OTHER NON-METALLIC MINERAL PRODUCTS 3.202 134.7 134.4 131.4 131.3 131.8 1.3.13.1 Glass and Glass products 0.295 163.8 164.2 162.1 163.4 163.5 1.3.13.2 Refractory products 0.223 119.7 119.1 123.5 125.3 125.3 1.3.13.3 Clay Building Materials 0.121 123.9 116.2 127.5 123.3 131.9 1.3.13.4 Other Porcelain and Ceramic Products 0.222 122.3 123.3 124.6 124.6 124.9 1.3.13.5 Cement, Lime and Plaster 1.645 137.3 137.2 130.1 129.5 130.0 136 RBI Bulletin February 2025CURRENT STATISTICS No. 21: Wholesale Price Index (Contd.) (Base: 2011-12 = 100) Commodities Weight 2023-24 2024 2025 Jan. Nov. Dec.(P) Jan.(P) 1 2 3 4 5 6 1.3.13.6 Articles of Concrete, Cement and Plaster 0.292 137.7 137.7 139.6 139.7 139.6 1.3.13.7 Cutting, Shaping and Finishing of Stone 0.234 130.3 131.7 135.2 135.9 135.5 1.3.13.8 Other Non-Metallic Mineral Products 0.169 102.4 101.4 93.7 94.2 94.1 1.3.14 MANUFACTURE OF BASIC METALS 9.646 141.0 138.8 138.6 137.6 137.1 1.3.14.1 Inputs into steel making 1.411 140.3 135.5 132.1 130.2 129.3 1.3.14.2 Metallic Iron 0.653 153.6 150.8 138.7 133.4 131.8 1.3.14.3 Mild Steel - Semi Finished Steel 1.274 119.9 117.2 117.5 116.9 116.7 1.3.14.4 Mild Steel -Long Products 1.081 141.3 138.3 140.2 139.5 138.7 1.3.14.5 Mild Steel - Flat products 1.144 143.4 140.6 131.9 129.6 129.9 1.3.14.6 Alloy steel other than Stainless Steel- Shapes 0.067 137.6 133.1 133.7 132.3 132.8 1.3.14.7 Stainless Steel - Semi Finished 0.924 136.4 131.8 126.8 129.0 127.7 1.3.14.8 Pipes & tubes 0.205 169.7 166.8 163.5 162.7 164.1 1.3.14.9 Non-ferrous metals incl. precious metals 1.693 144.8 145.0 157.7 156.6 157.3 1.3.14.10 Castings 0.925 141.0 142.7 145.4 146.2 144.8 1.3.14.11 Forgings of steel 0.271 173.3 174.6 172.8 172.1 172.4 1.3.15 MANUFACTURE OF FABRICATED METAL PRODUCTS, EXCEPT MACHINERY AND EQUIPMENT 3.155 138.6 137.8 135.3 136.1 135.4 1.3.15.1 Structural Metal Products 1.031 132.3 132.8 129.3 130.9 130.2 1.3.15.2 Tanks, Reservoirs and Containers of Metal 0.660 157.6 153.9 146.9 147.6 147.4 1.3.15.3 Steam generators, Except Central Heating Hot Water Boilers 0.145 106.3 106.4 111.3 112.5 111.1 1.3.15.4 Forging, Pressing, Stamping and Roll-Forming of Metal; Powder Metallurgy 0.383 141.4 141.6 141.5 140.6 137.9 1.3.15.5 Cutlery, Hand Tools and General Hardware 0.208 108.4 109.3 102.2 102.4 102.5 1.3.15.6 Other Fabricated Metal Products 0.728 143.8 142.8 144.3 145.1 144.8 1.3.16 MANUFACTURE OF COMPUTER, ELECTRONIC AND OPTICAL PRODUCTS 2.009 119.3 119.5 121.3 121.2 121.5 1.3.16.1 Electronic Components 0.402 115.0 114.2 117.3 118.4 118.3 1.3.16.2 Computers and Peripheral Equipment 0.336 135.3 135.1 133.6 132.6 132.7 1.3.16.3 Communication Equipment 0.310 136.1 139.7 145.9 146.2 146.3 1.3.16.4 Consumer Electronics 0.641 103.6 102.8 100.2 100.0 100.0 1.3.16.5 Measuring, Testing, Navigating and Control equipment 0.181 113.8 114.0 120.9 121.1 121.9 1.3.16.6 Watches and Clocks 0.076 157.2 159.3 172.7 167.7 172.7 1.3.16.7 Irradiation, Electromedical and Electrotherapeutic equipment 0.055 108.3 109.0 115.2 116.5 116.1 1.3.16.8 Optical instruments and Photographic equipment 0.008 103.8 103.1 108.7 108.7 108.9 1.3.17 MANUFACTURE OF ELECTRICAL EQUIPMENT 2.930 131.4 132.1 133.8 134.1 134.1 1.3.17.1 Electric motors, Generators, Transformers and Electricity distribution and Control apparatus 1.298 130.1 131.4 132.5 133.4 133.1 1.3.17.2 Batteries and Accumulators 0.236 137.8 138.9 141.7 141.3 140.9 1.3.17.3 Fibre optic cables for data transmission or live transmission of images 0.133 123.4 123.1 117.5 118.0 116.8 1.3.17.4 Other electronic and Electric wires and Cables 0.428 146.1 145.9 154.5 154.1 154.8 1.3.17.5 Wiring devices, Electric lighting & display equipment 0.263 116.8 117.7 117.8 117.6 117.9 1.3.17.6 Domestic appliances 0.366 133.8 134.0 131.8 131.8 132.0 1.3.17.7 Other electrical equipment 0.206 120.9 120.6 124.8 125.1 124.7 1.3.18 MANUFACTURE OF MACHINERY AND EQUIPMENT 4.789 129.0 129.8 130.5 130.6 131.0 1.3.18.1 Engines and Turbines, Except aircraft, Vehicle and Two wheeler engines 0.638 128.9 129.7 133.6 132.5 133.3 1.3.18.2 Fluid power equipment 0.162 131.9 132.1 134.6 134.7 135.6 1.3.18.3 Other pumps, Compressors, Taps and Valves 0.552 117.4 118.0 118.7 118.8 118.8 1.3.18.4 Bearings, Gears, Gearing and Driving elements 0.340 127.7 129.6 128.1 129.0 129.7 1.3.18.5 Ovens, Furnaces and Furnace burners 0.008 83.7 85.3 86.5 86.9 87.4 1.3.18.6 Lifting and Handling equipment 0.285 128.6 129.0 130.0 129.9 129.6 RBI Bulletin February 2025 137CURRENT STATISTICS No. 21: Wholesale Price Index (Concld.) (Base: 2011-12 = 100) Commodities Weight 2023-24 2024 2025 Jan. Nov. Dec.(P) Jan.(P) 1 2 3 4 5 6 1.3.18.7 Office machinery and Equipment 0.006 130.2 130.2 130.2 130.2 130.2 1.3.18.8 Other general-purpose machinery 0.437 145.2 146.1 142.8 142.7 142.0 1.3.18.9 Agricultural and Forestry machinery 0.833 142.5 144.1 145.6 145.8 146.7 1.3.18.10 Metal-forming machinery and Machine tools 0.224 122.5 122.0 123.1 123.1 123.1 1.3.18.11 Machinery for mining, Quarrying and Construction 0.371 88.6 88.7 89.5 90.0 91.0 1.3.18.12 Machinery for food, Beverage and Tobacco processing 0.228 124.4 124.2 126.0 126.2 126.9 1.3.18.13 Machinery for textile, Apparel and Leather production 0.192 137.2 135.7 138.2 141.3 141.6 1.3.18.14 Other special-purpose machinery 0.468 144.7 145.7 144.3 144.1 143.9 1.3.18.15 Renewable electricity generating equipment 0.046 70.8 70.7 68.6 68.8 69.0 1.3.19 MANUFACTURE OF MOTOR VEHICLES, TRAILERS AND SEMI-TRAILERS 4.969 128.4 128.5 129.4 129.8 130.1 1.3.19.1 Motor vehicles 2.600 128.5 128.3 129.7 130.5 131.0 1.3.19.2 Parts and Accessories for motor vehicles 2.368 128.2 128.7 129.0 129.1 129.0 1.3.20 MANUFACTURE OF OTHER TRANSPORT EQUIPMENT 1.648 143.1 143.4 145.7 145.8 145.7 1.3.20.1 Building of ships and Floating structures 0.117 163.7 163.7 177.9 177.9 188.4 1.3.20.2 Railway locomotives and Rolling stock 0.110 107.4 110.4 107.8 108.4 108.4 1.3.20.3 Motor cycles 1.302 144.7 144.8 147.0 147.0 146.0 1.3.20.4 Bicycles and Invalid carriages 0.117 137.9 138.2 133.3 135.1 134.4 1.3.20.5 Other transport equipment 0.002 159.2 159.6 162.9 163.7 165.7 1.3.21 MANUFACTURE OF FURNITURE 0.727 159.6 160.0 162.9 161.3 161.8 1.3.21.1 Furniture 0.727 159.6 160.0 162.9 161.3 161.8 1.3.22 OTHER MANUFACTURING 1.064 158.2 160.8 183.8 183.1 186.9 1.3.22.1 Jewellery and Related articles 0.996 157.9 160.9 185.3 184.6 188.8 1.3.22.2 Musical instruments 0.001 187.0 190.6 205.2 200.6 197.2 1.3.22.3 Sports goods 0.012 155.2 155.3 167.8 167.9 167.7 1.3.22.4 Games and Toys 0.005 159.6 159.9 163.6 163.5 164.4 1.3.22.5 Medical and Dental instruments and Supplies 0.049 163.1 161.2 158.6 158.6 156.5 2 FOOD INDEX 24.378 179.8 178.1 200.2 195.9 191.4 Source: Office of the Economic Adviser, Ministry of Commerce and Industry, Government of India. 138 RBI Bulletin February 2025CURRENT STATISTICS No. 22: Index of Industrial Production (Base:2011-12=100) Industry Weight 2022-23 2023-24 April-December December 2023-24 2024-25 2023 2024 1 2 3 4 5 6 7 General Index 100.00 138.5 146.7 144.4 150.2 152.3 157.2 1 Sectoral Classification 1.1 Mining 14.37 119.9 128.9 122.9 127.0 139.5 143.1 1.2 Manufacturing 77.63 137.1 144.7 142.7 148.4 151.6 156.2 1.3 Electricity 7.99 185.2 198.3 199.0 209.8 181.6 192.8 2 Use-Based Classification 2.1 Primary Goods 34.05 139.2 147.7 145.2 150.8 151.9 157.7 2.2 Capital Goods 8.22 100.3 106.6 103.6 108.9 103.8 114.5 2.3 Intermediate Goods 17.22 149.4 157.3 155.2 162.2 159.8 169.3 2.4 Infrastructure/ Construction Goods 12.34 160.7 176.3 172.7 183.2 180.3 191.7 2.5 Consumer Durables 12.84 114.5 118.6 116.6 126.8 114.5 124.0 2.6 Consumer Non-Durables 15.33 147.7 153.7 152.8 150.5 179.7 166.0 Source : Central Statistics Office, Ministry of Statistics and Programme Implementation, Government of India. Government Accounts and Treasury Bills No. 23: Union Government Accounts at a Glance (₹ Crore) Financial Year April – December 2024-25 Percentage to Revised Item (Revised 2024-25 2023-24 Estimates (Actuals) (Actuals) Estimates) 2024-25 2023-24 1 2 3 4 5 1 Revenue Receipts 3087960 2290710 2042289 74.2 75.6 1.1 Tax Revenue (Net) 2556960 1843053 1729931 72.1 74.4 1.2 Non-Tax Revenue 531000 447657 312358 84.3 83.1 2 Non Debt Capital Receipt 59000 27295 29650 46.3 52.9 2.1 Recovery of Loans 26000 18301 19597 70.4 75.4 2.2 Other Receipts 33000 8994 10053 27.3 33.5 3 Total Receipts (excluding borrowings) (1+2) 3146960 2318005 2071939 73.7 75.2 4 Revenue Expenditure 3698058 2546757 2380587 68.9 67.2 of which : 4.1 Interest Payments 1137940 808313 748207 71.0 70.9 5 Capital Expenditure 1018429 685337 673630 67.3 70.9 6 Total Expenditure (4+5) 4716487 3232094 3054217 68.5 68.0 7 Revenue Deficit (4-1) 610098 256047 338298 42.0 40.2 8 Fiscal Deficit (6-3) 1569527 914089 982278 58.2 56.6 9 Gross Primary Deficit (8-4.1) 431587 105776 234071 24.5 34.5 Source: Controller General of Accounts (CGA), Ministry of Finance, Government of India and Union Budget 2025-26. RBI Bulletin February 2025 139CURRENT STATISTICS No. 24: Treasury Bills – Ownership Pattern (₹ Crore) 2023-24 2023 2024 Item Dec. 29 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 1 2 3 4 5 6 7 8 1 91-day 1.1 Banks 18054 9694 3054 3848 3875 3966 4311 8030 1.2 Primary Dealers 22676 16909 9025 9398 10342 8735 10210 6404 1.3 State Governments 5701 24851 79060 82560 84296 86046 95646 109146 1.4 Others 88670 75897 81021 78354 75883 75899 81079 88165 2 182-day 2.1 Banks 84913 79976 40000 42525 42131 42959 46651 49106 2.2 Primary Dealers 87779 60167 32689 30551 29378 29890 33579 34108 2.3 State Governments 4070 8887 12265 11265 11265 10265 6515 8515 2.4 Others 102311 78861 78212 80824 84891 86751 81370 80386 3 364-day 3.1 Banks 91819 102529 78510 75027 75344 77042 76504 76181 3.2 Primary Dealers 159085 177911 108012 106748 105794 104793 105013 104156 3.3 State Governments 41487 44909 35829 35933 34438 35686 35632 35184 3.4 Others 165095 168561 169478 171225 168862 165165 162483 160663 4 14-day Intermediate 4.1 Banks 4.2 Primary Dealers 4.3 State Governments 318736 198774 190890 188494 126670 174019 182802 173736 4.4 Others 442 1780 1357 551 1729 546 1074 449 Total Treasury Bills (Excluding 14 day 871662 849151 727154 728257 726498 727197 738993 760045 Intermediate T Bills) # # 14D intermediate T-Bills are non-marketable unlike 91D, 182D and 364D T-Bills. These bills are ‘intermediate’ by nature as these are liquidated to replenish shortfall in the daily minimum cash balances of State Governments. Note: Primary Dealers (PDs) include banks undertaking PD business. No. 25: Auctions of Treasury Bills (Amount in ₹ Crore) Date of Notified Bids Received Bids Accepted Total Cutoff Implicit Yield Auction Amount Total Face Value Total Face Value Issue Price at Cut-off Price Number Number (6+7) ( ₹ ) (per cent) Competitive Non- Competitive Non- Competitive Competitive 1 2 3 4 5 6 7 8 9 10 91-day Treasury Bills 2024-25 Nov. 27 7000 93 19172 10028 49 6972 10028 17000 98.41 6.4929 Dec. 4 7000 112 23634 9796 34 6941 9796 16737 98.42 6.4287 Dec. 11 7000 109 27635 9591 35 6959 9591 16550 98.42 6.4478 Dec. 18 7000 106 25391 9625 33 6975 9625 16600 98.41 6.4726 Dec. 26 7000 80 23077 13523 32 6977 13523 20500 98.39 6.5489 182-day Treasury Bills 2024-25 Nov. 27 6000 96 20278 1015 38 5985 1015 7000 96.79 6.6599 Dec. 4 6000 66 22335 1530 11 5970 1530 7500 96.84 6.5386 Dec. 11 6000 78 13477 1216 57 5984 1216 7200 96.81 6.6100 Dec. 18 6000 107 20487 819 44 5981 819 6800 96.80 6.6400 Dec. 26 6000 93 19875 2019 33 5981 2019 8000 96.77 6.7000 364-day Treasury Bills 2024-25 Nov. 27 6000 72 14513 119 41 5994 119 6114 93.78 6.6545 Dec. 4 6000 91 19692 119 23 5986 119 6106 93.89 6.5295 Dec. 11 6000 82 16529 1285 42 5987 1285 7272 93.84 6.5780 Dec. 18 6000 96 18029 137 51 5965 137 6102 93.80 6.6300 Dec. 26 6000 88 23340 1672 21 5991 1672 7662 93.75 6.6878 140 RBI Bulletin February 2025CURRENT STATISTICS Financial Markets No. 26: Daily Call Money Rates (Per cent per annum) Range of Rates Weighted Average Rates As on Borrowings/ Lendings Borrowings/ Lendings 1 2 December 02 ,2024 5.10-6.65 6.51 December 03 ,2024 5.10-6.50 6.44 December 04 ,2024 5.10-6.60 6.42 December 05 ,2024 5.10-6.75 6.54 December 06 ,2024 5.50-6.75 6.52 December 07 ,2024 5.50-6.70 6.15 December 09 ,2024 5.50-6.75 6.56 December 10 ,2024 5.50-6.85 6.67 December 11 ,2024 5.50-6.90 6.70 December 12 ,2024 5.50-6.80 6.62 December 13 ,2024 5.50-6.85 6.68 December 16 ,2024 5.50-6.90 6.70 December 17 ,2024 5.10-6.85 6.70 December 18 ,2024 5.10-6.85 6.69 December 19 ,2024 5.10-6.90 6.71 December 20 ,2024 5.10-7.00 6.74 December 21 ,2024 5.50-6.80 6.14 December 23 ,2024 5.10-6.90 6.74 December 24 ,2024 5.10-6.90 6.71 December 26 ,2024 5.10-6.85 6.66 December 27 ,2024 5.10-7.00 6.77 December 30 ,2024 5.10-7.00 6.74 December 31 ,2024 5.10-7.25 6.87 January 1, 2025 5.10-6.70 6.52 January 2, 2025 5.10-6.60 6.47 January 3, 2025 5.10-6.75 6.50 January 4, 2025 5.75-6.60 6.12 January 6, 2025 5.10-6.80 6.64 January 7, 2025 5.10-6.95 6.73 January 8, 2025 5.10-7.05 6.74 January 9, 2025 5.10-7.05 6.82 January 10, 2025 5.10-7.10 6.87 January 13, 2025 5.70-7.10 6.81 January 14, 2025 5.50-6.75 6.52 January 15, 2025 5.10-6.70 6.45 Note: Includes Notice Money. RBI Bulletin February 2025 141CURRENT STATISTICS No. 27: Certificates of Deposit 2023 2024 2025 Item Dec. 29 Nov. 15 Nov. 29 Dec. 13 Dec. 27 Jan. 10 Jan. 24 1 2 3 4 5 6 7 1 Amount Outstanding (₹ Crore) 344752.77 489838.50 491658.72 488257.46 494416.56 493930.59 499396.94 1.1 Issued during the fortnight (₹ Crore) 38992.46 46552.33 40434.94 74226.34 59838.75 33890.42 30080.60 2 Rate of Interest (per cent) 7.27-7.98 6.98-7.85 6.98-7.60 6.96-7.75 7.02-7.85 7.05-7.48 7.07-7.88 No. 28: Commercial Paper Item 2023 2024 Dec. 31 Nov. 15 Nov. 30 Dec. 15 Dec. 31 1 2 3 4 5 1 Amount Outstanding (₹ Crore) 364181.25 448862.80 445122.05 463801.30 435779.45 1.1 Reported during the fortnight (₹ Crore) 42874.35 50771.85 64504.65 98956.25 51524.05 2 Rate of Interest (per cent) 7.02-12.13 6.99-13.77 7.00-12.61 7.00-11.89 6.98-12.00 No. 29: Average Daily Turnover in Select Financial Markets (₹ Crore) Item 2023-24 2023 2024 Dec. 29 Nov. 22 Nov. 29 Dec. 6 Dec. 13 Dec. 20 Dec. 27 1 2 3 4 5 6 7 8 1 Call Money 17761 17285 14474 14605 15780 21252 21302 18396 2 Notice Money 2550 5238 331 4241 3744 213 4378 177 3 Term Money 871 598 895 1743 843 720 896 539 4 Triparty Repo 601363 708714 707471 939435 719747 695288 825455 698889 5 Market Repo 574534 512436 493723 585745 512219 521188 616987 452238 6 Repo in Corporate Bond 1817 1207 4588 5114 5835 5302 6123 8475 7 Forex (US $ million) 95115 121622 108061 123525 128628 135496 129131 130014 8 Govt. of India Dated Securities 90992 52022 76147 83490 161875 135854 92916 63621 9 State Govt. Securities 6102 6640 5307 4154 8593 6813 7900 10874 10 Treasury Bills 10.1 91-Day 5378 7661 3669 1988 2217 3692 3586 6006 10.2 182-Day 6079 5339 3533 3800 1887 2802 2153 3089 10.3 364-Day 4307 5623 3550 3800 2706 2906 1851 2669 10.4 Cash Management Bills 0 0 0 0 0 0 11 Total Govt. Securities (8+9+10) 112858 77285 92206 97232 177278 152067 108407 86258 11.1 RBI 492 46 15 213 320 286 666 306 142 RBI Bulletin February 2025CURRENT STATISTICS No. 30: New Capital Issues by Non-Government Public Limited Companies (Amount in ₹ Crore) 2023-24 2023-24 (Apr.-Dec.) 2024-25 (Apr.-Dec.) * Dec. 2023 Dec. 2024 * Security & Type of Issue No. of Amount No. of Amount No. of Amount No. of Amount No. of Amount Issues Issues Issues Issues Issues 1 2 3 4 5 6 7 8 9 10 1 Equity Shares 339 80942 243 57411 368 189018 33 9572 48 31119 1.1 Public 272 65832 195 50873 261 172137 31 9534 34 27031 1.2 Rights 67 15110 48 6538 107 16881 2 38 14 4088 2 Public Issue of 44 16342 32 12932 32 6628 6 2014 3 722 Bonds/ Debentures 3 Total (1+2) 383 97284 275 70343 400 195646 39 11586 51 31841 3.1 Public 316 82174 227 63805 293 178765 37 11548 37 27753 3.2 Rights 67 15110 48 6538 107 16881 2 38 14 4088 Note : 1. Since April 2020, monthly data on equity issues is compiled on the basis of their listing date. 2. Figures in the columns might not add up to the total due to rounding off numbers. 3. The table covers only public and rights issuances of equity and debt. It does not include data on private placement of debt, qualified institutional placements and preferential allotments. Source : Securities and Exchange Board of India. * : Data is Provisional RBI Bulletin February 2025 143CURRENT STATISTICS External Sector No. 31: Foreign Trade 2023 2024 2023-24 Item Unit Dec. Aug. Sep. Oct. Nov. Dec. 1 2 3 4 5 6 7 1 Exports ₹ Crore 3618952 319716 289305 287578 327712 270298 323039 US $ Million 437072 38391 34484 34314 39000 32039 38011 1.1 Oil ₹ Crore 696850 57369 47817 37764 37175 30891 41787 US $ Million 84157 6889 5700 4506 4424 3662 4917 1.2 Non-oil ₹ Crore 2922102 262347 241488 249814 290537 239406 281252 US $ Million 352915 31502 28784 29808 34576 28378 33094 2 Imports ₹ Crore 5616042 475950 524948 452606 530437 538792 509477 US $ Million 678215 57152 62571 54005 63125 63865 59948 2.1 Oil ₹ Crore 1480232 124422 92396 104574 153628 134229 129782 US $ Million 178733 14940 11013 12478 18283 15911 15271 2.2 Non-oil ₹ Crore 4135810 351528 432552 348032 376809 404562 379695 US $ Million 499482 42211 51558 41527 44842 47954 44677 3 Trade Balance ₹ Crore -1997090 -156235 -235643 -165028 -202725 -268494 -186438 US $ Million -241143 -18760 -28087 -19691 -24125 -31825 -21937 3.1 Oil ₹ Crore -783382 -67054 -44579 -66811 -116453 -103338 -87995 US $ Million -94576 -8052 -5314 -7972 -13859 -12249 -10354 3.2 Non-oil ₹ Crore -1213708 -89181 -191064 -98217 -86272 -165156 -98443 US $ Million -146567 -10709 -22774 -11719 -10267 -19577 -11583 Note: Data in the table are provisional. Source: Directorate General of Commercial Intelligence and Statistics. No. 32: Foreign Exchange Reserves 2024 2025 Item Unit Feb. 02 Dec. 27 Jan. 03 Jan. 10 Jan. 17 Jan. 24 Jan. 31 1 2 3 4 5 6 7 1 Total Reserves ₹ Crore 5161947 5476869 5443633 5380402 5404532 5426706 5461741 US $ Million 622469 640279 634585 625871 623983 629557 630607 1.1 Foreign Currency Assets ₹ Crore 4572053 4721047 4679273 4607932 4617658 4636524 4656917 US $ Million 551331 551921 545480 536011 533133 537891 537684 1.2 Gold ₹ Crore 398786 566843 575530 583572 597172 600379 614007 US $ Million 48088 66268 67092 67883 68947 69651 70893 Volume (Metric Tonnes) 812.33 876.18 876.18 877.14 877.14 877.14 879.01 1.3 SDRs SDRs Million 13688 13705 13705 13705 13705 13705 13705 ₹ Crore 150849 152881 152818 152861 154015 153955 154942 US $ Million 18190 17873 17815 17781 17782 17861 17889 1.4 Reserve Tranche Position in IMF ₹ Crore 40260 36097 36012 36037 35687 35848 35875 US $ Million 4860 4217 4199 4195 4122 4154 4141 * Difference, if any, is due to rounding off. Note: Exclude investment in foreign currency denominated bonds issued by IIFC (UK), SDRs transferred by Government of India to RBI and foreign currency received under SAARC and ACU currency swap arrangements. Foreign currency assets in US dollar take into account appreciation/depreciation of non-US currencies (such as Euro, Sterling, Yen and Australian Dollar) held in reserves. Foreign exchange holdings are converted into rupees at rupee-US dollar RBI holding rates. No. 33: Non-Resident Deposits (US $ Million) Scheme Outstanding Flows 2023 2024 2023-24 2024-25 2023-24 Dec. Nov. Dec. (P) Apr.-Dec. Apr.-Dec.(P) 1 2 3 4 5 6 1 NRI Deposits 151879 146909 162697 161804 9338 13333 1.1 FCNR(B) 25733 22815 32040 32198 3452 6465 1.2 NR(E)RA 98624 97692 100666 99565 2916 3572 1.3 NRO 27522 26403 29992 30041 2970 3296 P: Provisional. 144 RBI Bulletin February 2025CURRENT STATISTICS No. 34: Foreign Investment Inflows (US $ Million) 2023-24 2024-25 (P) 2023 2024 (P) Item 2023-24 Apr.-Dec. Apr.-Dec. Dec. Nov. Dec. 1 2 3 4 5 6 1.1 Net Foreign Direct Investment (1.1.1-1.1.2) 10129 7846 1180 -656 -2630 707 1.1.1 Direct Investment to India (1.1.1.1-1.1.1.2) 26807 18760 18487 1312 -97 2461 1.1.1.1 Gross Inflows/Gross Investments 71279 51821 62483 4628 5373 6838 1.1.1.1.1 Equity 45817 33055 41385 2495 2370 4458 1.1.1.1.1.1 Government (SIA/FIPB) 585 327 1848 103 72 1248 1.1.1.1.1.2 RBI 31826 21067 27367 1278 1676 1543 1.1.1.1.1.3 Acquisition of shares 12013 10643 11457 993 537 1583 1.1.1.1.1.4 Equity capital of unincorporated bodies 1394 1018 712 121 85 85 1.1.1.1.2 Reinvested earnings 19768 14435 16873 1718 1996 1996 1.1.1.1.3 Other capital 5694 4330 4225 414 1007 383 1.1.1.2 Repatriation/Disinvestment 44472 33061 43996 3316 5470 4377 1.1.1.2.1 Equity 41334 30401 42311 2924 5088 4299 1.1.1.2.2 Other capital 3137 2660 1685 392 382 77 1.1.2 Foreign Direct Investment by India 16678 10914 17307 1968 2533 1754 (1.1.2.1+1.1.2.2+1.1.2.3-1.1.2.4) 1.1.2.1 Equity capital 9111 5902 9861 902 1020 1164 1.1.2.2 Reinvested Earnings 5786 4339 4474 482 482 482 1.1.2.3 Other Capital 5406 3591 5581 773 1230 640 1.1.2.4 Repatriation/Disinvestment 3624 2918 2608 189 200 532 1.2 Net Portfolio Investment (1.2.1+1.2.2+1.2.3-1.2.4) 44081 32690 9252 9555 -2379 1712 1.2.1 GDRs/ADRs - - - - - - 1.2.2 FIIs 44626 33047 9107 9442 -2396 1766 1.2.3 Offshore funds and others - - - - - - 1.2.4 Portfolio investment by India 544 357 -145 -114 -17 54 1 Foreign Investment Inflows 54210 40535 10432 8899 -5008 2419 P: Provisional No. 35: Outward Remittances under the Liberalised Remittance Scheme (LRS) for Resident Individuals (US $ Million) 2023 2024 Item 2023-24 Dec. Oct. Nov. Dec. 1 2 3 4 5 1 Outward Remittances under the LRS 31735.74 2402.07 2408.01 1946.43 2315.96 1.1 Deposit 916.45 26.64 39.06 40.21 48.10 1.2 Purchase of immovable property 242.51 12.17 24.96 23.53 30.14 1.3 Investment in equity/debt 1510.89 101.43 149.34 85.79 179.34 1.4 Gift 3580.27 190.77 216.30 216.51 229.47 1.5 Donations 11.31 0.71 0.66 0.62 0.63 1.6 Travel 17006.27 1548.65 1454.66 1113.78 1323.64 1.7 Maintenance of close relatives 4611.53 219.71 283.75 276.78 279.02 1.8 Medical Treatment 79.62 7.79 8.49 7.49 5.13 1.9 Studies Abroad 3478.65 267.56 221.18 172.40 210.20 1.10 Others 298.23 26.65 9.62 9.32 10.31 RBI Bulletin February 2025 145CURRENT STATISTICS No. 36: Indices of Nominal Effective Exchange Rate (NEER) and Real Effective Exchange Rate (REER) of the Indian Rupee 2024 2025 2022-23 2023-24 Jan Dec Jan Item 1 2 3 4 5 40-Currency Basket (Base: 2015-16=100) 1 Trade-Weighted 91.20 90.75 90.70 91.69 90.84 1.1 NEER 102.78 103.71 103.70 107.13 104.82 1.2 REER 2 Export-Weighted 93.01 93.13 93.24 94.02 93.23 2.1 NEER 2.2 REER 101.10 101.23 101.21 103.92 101.75 6-Currency Basket (Trade-weighted) 1 Base : 2015-16 =100 85.93 83.62 83.15 82.78 82.02 1.1 NEER 1.2 REER 101.80 101.66 101.74 104.64 102.76 2 Base : 2022-23 =100 2.1 NEER 100.00 97.31 96.76 96.33 95.45 2.2 REER 100.00 99.86 99.94 102.79 100.93 Memo Items INR-USD Rate 80.36 82.79 83.12 84.99 86.27 India's CPI Inflation (per cent) 6.7 5.4 5.1 5.2 4.3 Notes: 1. Annual data on NEER and REER are based on annual averages of exchange rates while monthly data are based on monthly averages of exchange rates. 2. Data for 2023-24 and 2024-25 so far are provisional. 146 RBI Bulletin February 2025CURRENT STATISTICS No. 37: External Commercial Borrowings (ECBs) – Registrations (Amount in US $ Million) Item 2023-24 2023 2024 Dec. Nov. Dec. 1 2 3 4 1 Automatic Route 1.1 Number 1188 95 82 112 1.2 Amount 29461 3693 1398 6234 2 Approval Route 2.1 Number 33 3 4 12 2.2 Amount 19748 1450 1435 3309 3 Total (1+2) 3.1 Number 1221 98 86 124 3.2 Amount 49209 5143 2833 9543 4 Weighted Average Maturity (in years) 5.60 4.90 5.80 4.50 5 Interest Rate (per cent) 5.1 Weighted Average Margin over alternative reference rate (ARR) for Floating Rate Loans@ 1.66 1.85 1.18 1.45 5.2 Interest rate range for Fixed Rate Loans 0.00-27.00 0.00-10.50 0.00-11.00 0.00-10.60 Borrower Category I. Corporate Manufacturing 15836 519 1419 3685 II. Corporate-Infrastructure 15916 2623 372 533 a.) Transport 1505 240 0 0 b.) Energy 3513 1963 60 0 c.) Water and Sanitation 33 0 0 0 d.) Communication 6309 0 0 0 e.) Social and Commercial Infrastructure 115 0 0 0 f.) Exploration,Mining and Refinery 2480 420 312 530 g.) Other Sub-Sectors 1961 0 0 3 III. Corporate Service-Sector 1526 58 256 685 IV. Other Entities 1728 750 0 3 a.) units in SEZ 1 0 0 3 b.) SIDBI 0 0 0 0 c.) Exim Bank 1727 750 0 0 V. Banks 0 0 0 0 VI. Financial Institution (Other than NBFC ) 20 0 0 - VII. NBFCs 13361 1131 743 4614 a). NBFC- IFC/AFC 7734 700 75 3042 b). NBFC-MFI 531 11 0 0 c). NBFC-Others 5096 420 668 1572 VIII. Non-Government Organization (NGO) 0 0 0 0 IX. Micro Finance Institution (MFI) 0 0 0 0 X. Others 822 62 43 23 Note: Based on applications for ECB/Foreign Currency Convertible Bonds (FCCBs) which have been allotted loan registration number during the period. @ With effect from July 01, 2023, the benchmark rate is changed to Alternative Reference Rate (ARR) RBI Bulletin February 2025 147CURRENT STATISTICS No. 38: India’s Overall Balance of Payments (US$ Million) Jul-Sep 2023 Jul-Sep 2024 (P) Credit Debit Net Credit Debit Net Item 1 2 3 4 5 6 Overall Balance Of Payments (1+2+3) 438441 435922 2519 553557 534943 18614 1 Current Account (1.1+ 1.2) 231670 242956 -11286 245671 256854 -11182 1.1 Merchandise 108254 172799 -64544 103967 179285 -75319 1.2 Invisibles (1.2.1+1.2.2+1.2.3) 123416 70158 53258 141705 77568 64137 1.2.1 Services 83352 43411 39940 93493 48943 44550 1.2.1.1 Travel 7482 8662 -1180 7635 9367 -1732 1.2.1.2 Transportation 7054 7277 -223 8792 9188 -396 1.2.1.3 Insurance 828 821 7 902 786 116 1.2.1.4 G.n.i.e. 140 244 -104 147 316 -169 1.2.1.5 Miscellaneous 67848 26408 41440 76017 29287 46730 1.2.1.5.1 Software Services 39570 4333 35237 44164 4539 39624 1.2.1.5.2 Business Services 21472 13673 7799 25176 15548 9628 1.2.1.5.3 Financial Services 2069 1183 887 2190 1265 926 1.2.1.5.4 Communication Services 887 365 522 519 497 21 1.2.2 Transfers 28147 3221 24926 31938 2829 29109 1.2.2.1 Official 23 267 -244 28 265 -237 1.2.2.2 Private 28124 2954 25170 31910 2564 29346 1.2.3 Income 11917 23526 -11608 16274 25796 -9522 1.2.3.1 Investment Income 10158 22609 -12451 14279 24774 -10494 1.2.3.2 Compensation of Employees 1760 917 843 1995 1023 972 2 Capital Account (2.1+2.2+2.3+2.4+2.5) 205807 192966 12841 307885 277368 30518 2.1 Foreign Investment (2.1.1+2.1.2) 128572 124460 4112 203323 185710 17612 2.1.1 Foreign Direct Investment 16586 17420 -834 21214 23452 -2238 2.1.1.1 In India 15722 12686 3036 20666 15622 5044 2.1.1.1.1 Equity 9877 12278 -2401 13847 15016 -1169 2.1.1.1.2 Reinvested Earnings 4740 4740 5559 5559 2.1.1.1.3 Other Capital 1105 409 697 1261 606 655 2.1.1.2 Abroad 864 4734 -3870 548 7830 -7282 2.1.1.2.1 Equity 864 1683 -820 548 4313 -3765 2.1.1.2.2 Reinvested Earnings 0 1446 -1446 0 1514 -1514 2.1.1.2.3 Other Capital 0 1604 -1604 0 2003 -2003 2.1.2 Portfolio Investment 111986 107040 4947 182108 162258 19850 2.1.2.1 In India 111127 105841 5286 181433 161618 19815 2.1.2.1.1 FIIs 111127 105841 5286 181433 161618 19815 2.1.2.1.1.1 Equity 101529 97937 3593 160273 149590 10683 2.1.2.1.1.2 Debt 9598 7905 1693 21160 12028 9132 2.1.2.1.2 ADR/GDRs 0 0 0 0 0 0 2.1.2.2 Abroad 859 1198 -339 675 640 35 2.2 Loans (2.2.1+2.2.2+2.2.3) 29728 26453 3274 38662 31126 7536 2.2.1 External Assistance 2601 1800 802 3727 1581 2146 2.2.1.1 By India 9 49 -40 8 30 -22 2.2.1.2 To India 2592 1751 842 3720 1551 2168 2.2.2 Commercial Borrowings 7464 10422 -2958 17443 15416 2027 2.2.2.1 By India 2853 3926 -1073 5059 8028 -2969 2.2.2.2 To India 4612 6496 -1884 12384 7388 4996 2.2.3 Short Term to India 19662 14232 5430 17492 14129 3363 2.2.3.1 Buyers' credit & Suppliers' Credit >180 days 17632 14232 3400 14817 14129 688 2.2.3.2 Suppliers' Credit up to 180 days 2030 0 2030 2675 0 2675 2.3 Banking Capital (2.3.1+2.3.2) 34020 29686 4333 52432 46345 6087 2.3.1 Commercial Banks 34020 29614 4405 52112 46345 5767 2.3.1.1 Assets 8673 11210 -2538 17627 18853 -1226 2.3.1.2 Liabilities 25347 18404 6943 34485 27492 6993 2.3.1.2.1 Non-Resident Deposits 21257 18048 3209 28921 22753 6167 2.3.2 Others 0 72 -72 319 0 319 2.4 Rupee Debt Service 0 1 -1 0 2 -2 2.5 Other Capital 13488 12365 1123 13469 14184 -716 3 Errors & Omissions 963 0 963 0 722 -722 4 Monetary Movements (4.1+ 4.2) 0 2519 -2519 0 18614 -18614 4.1 I.M.F. 0 0 0 0 0 0 4.2 Foreign Exchange Reserves (Increase - / Decrease +) 0 2519 -2519 0 18614 -18614 Note: P: Preliminary. 148 RBI Bulletin February 2025CURRENT STATISTICS No. 39: India’s Overall Balance of Payments (₹ Crore) Jul-Sep 2023 Jul-Sep 2024 (P) Credit Debit Net Credit Debit Net Item 1 2 3 4 5 6 Overall Balance Of Payments (1+2+3) 3624220 3603401 20819 4636946 4481027 155919 1 Current Account (1.1+ 1.2) 1915021 2008316 -93295 2057901 2151571 -93670 1.1 Merchandise 894849 1428380 -533531 870890 1501809 -630919 1.2 Invisibles (1.2.1+1.2.2+1.2.3) 1020172 579936 440236 1187011 649762 537249 1.2.1 Services 688997 358846 330151 783157 409979 373178 1.2.1.1 Travel 61845 71601 -9756 63958 78464 -14506 1.2.1.2 Transportation 58311 60151 -1840 73649 76965 -3316 1.2.1.3 Insurance 6842 6785 57 7553 6581 972 1.2.1.4 G.n.i.e. 1154 2018 -863 1228 2643 -1415 1.2.1.5 Miscellaneous 560846 218292 342554 636769 245326 391443 1.2.1.5.1 Software Services 327091 35818 291272 369945 38026 331920 1.2.1.5.2 Business Services 177488 113019 64469 210894 130244 80650 1.2.1.5.3 Financial Services 17106 9777 7329 18349 10595 7754 1.2.1.5.4 Communication Services 7334 3015 4319 4345 4167 177 1.2.2 Transfers 232665 26623 206042 267531 23696 243835 1.2.2.1 Official 189 2206 -2018 232 2218 -1985 1.2.2.2 Private 232476 24416 208060 267298 21478 245821 1.2.3 Income 98510 194468 -95957 136323 216087 -79763 1.2.3.1 Investment Income 83966 186888 -102922 119611 207519 -87908 1.2.3.2 Compensation of Employees 14544 7579 6965 16712 8568 8145 2 Capital Account (2.1+2.2+2.3+2.4+2.5) 1701234 1595084 106150 2579045 2323409 255635 2.1 Foreign Investment (2.1.1+2.1.2) 1062795 1028803 33993 1703161 1555629 147532 2.1.1 Foreign Direct Investment 137100 143996 -6896 177706 196451 -18745 2.1.1.1 In India 129962 104866 25096 173115 130862 42253 2.1.1.1.1 Equity 81644 101488 -19844 115988 125784 -9796 2.1.1.1.2 Reinvested Earnings 39181 0 39181 46563 0 46563 2.1.1.1.3 Other Capital 9137 3378 5759 10564 5078 5486 2.1.1.2 Abroad 7138 39130 -31992 4591 65589 -60998 2.1.1.2.1 Equity 7138 13916 -6778 4591 36128 -31537 2.1.1.2.2 Reinvested Earnings 0 11956 -11956 0 12680 -12680 2.1.1.2.3 Other Capital 0 13258 -13258 0 16780 -16780 2.1.2 Portfolio Investment 925695 884807 40889 1525455 1359178 166277 2.1.2.1 In India 918597 874902 43695 1519799 1353816 165984 2.1.2.1.1 FIIs 918597 874902 43695 1519799 1353816 165984 2.1.2.1.1.1 Equity 839257 809559 29698 1342550 1253064 89486 2.1.2.1.1.2 Debt 79340 65343 13997 177250 100752 76498 2.1.2.1.2 ADR/GDRs 0 0 0 0 0 0 2.1.2.2 Abroad 7099 9905 -2806 5656 5363 293 2.2 Loans (2.2.1+2.2.2+2.2.3) 245733 218667 27066 323859 260732 63127 2.2.1 External Assistance 21502 14877 6626 31222 13242 17979 2.2.1.1 By India 72 404 -331 64 247 -184 2.2.1.2 To India 21430 14473 6957 31158 12995 18163 2.2.2 Commercial Borrowings 61702 86150 -24448 146114 129136 16979 2.2.2.1 By India 23582 32453 -8871 42379 67249 -24870 2.2.2.2 To India 38120 53697 -15577 103735 61887 41849 2.2.3 Short Term to India 162529 117640 44888 146523 118354 28169 2.2.3.1 Buyers' credit & Suppliers' Credit >180 days 145745 117640 28105 124117 118354 5763 2.2.3.2 Suppliers' Credit up to 180 days 16783 0 16783 22406 0 22406 2.3 Banking Capital (2.3.1+2.3.2) 281213 245392 35820 439202 388217 50985 2.3.1 Commercial Banks 281213 244798 36415 436527 388217 48311 2.3.1.1 Assets 71689 92667 -20978 147657 157925 -10268 2.3.1.2 Liabilities 209524 152131 57393 288870 230292 58579 2.3.1.2.1 Non-Resident Deposits 175715 149187 26528 242259 190597 51662 2.3.2 Others 0 594 -594 2675 0 2675 2.4 Rupee Debt Service 0 12 -12 0 15 -15 2.5 Other Capital 111493 102211 9282 112822 118816 -5994 3 Errors & Omissions 7964 0 7964 0 6046 -6046 4 Monetary Movements (4.1+ 4.2) 0 20819 -20819 0 155919 -155919 4.1 I.M.F. 0 0 0 0 0 0 4.2 Foreign Exchange Reserves (Increase - / Decrease +) 0 20819 -20819 0 155919 -155919 Note: P: Preliminary. RBI Bulletin February 2025 149CURRENT STATISTICS No. 40: Standard Presentation of BoP in India as per BPM6 (US$ Million) Item Jul-Sep 2023 Jul-Sep 2024 (P) Credit Debit Net Credit Debit Net 1 2 3 4 5 6 1 Current Account (1.A+1.B+1.C) 231670 242934 -11264 245671 256828 -11157 1.A Goods and Services (1.A.a+1.A.b) 191606 216210 -24604 197459 228229 -30769 1.A.a Goods (1.A.a.1 to 1.A.a.3) 108254 172799 -64544 103967 179285 -75319 1.A.a.1 General merchandise on a BOP basis 107367 160246 -52879 103981 161701 -57720 1.A.a.2 Net exports of goods under merchanting 888 0 888 -14 0 -14 1.A.a.3 Nonmonetary gold 12553 -12553 17585 -17585 1.A.b Services (1.A.b.1 to 1.A.b.13) 83352 43411 39940 93493 48943 44550 1.A.b.1 Manufacturing services on physical inputs owned by others 283 39 244 276 20 256 1.A.b.2 Maintenance and repair services n.i.e. 56 308 -251 90 263 -172 1.A.b.3 Transport 7054 7277 -223 8792 9188 -396 1.A.b.4 Travel 7482 8662 -1180 7635 9367 -1732 1.A.b.5 Construction 954 677 277 1263 951 312 1.A.b.6 Insurance and pension services 828 821 7 902 786 116 1.A.b.7 Financial services 2069 1183 887 2190 1265 926 1.A.b.8 Charges for the use of intellectual property n.i.e. 422 3341 -2919 448 3877 -3428 1.A.b.9 Telecommunications, computer, and information services 40546 4968 35578 44772 5333 39439 1.A.b.10 Other business services 21472 13673 7799 25176 15548 9628 1.A.b.11 Personal, cultural, and recreational services 1211 2080 -869 1107 1794 -688 1.A.b.12 Government goods and services n.i.e. 140 244 -104 147 316 -169 1.A.b.13 Others n.i.e. 835 140 695 694 237 458 1.B Primary Income (1.B.1 to 1.B.3) 11917 23526 -11608 16274 25796 -9522 1.B.1 Compensation of employees 1760 917 843 1995 1023 972 1.B.2 Investment income 8939 22196 -13257 12849 24336 -11486 1.B.2.1 Direct investment 2322 12281 -9959 2725 13008 -10283 1.B.2.2 Portfolio investment 84 3657 -3573 78 4152 -4074 1.B.2.3 Other investment 520 6040 -5520 1168 6953 -5785 1.B.2.4 Reserve assets 6013 217 5796 8878 223 8655 1.B.3 Other primary income 1219 413 806 1430 438 992 1.C Secondary Income (1.C.1+1.C.2) 28146 3198 24948 31937 2803 29134 1.C.1 Financial corporations, nonfinancial corporations, households, and NPISHs 28124 2954 25170 31910 2564 29346 1.C.1.1 Personal transfers (Current transfers between resident and/non-resident households) 27335 2040 25296 31084 1803 29282 1.C.1.2 Other current transfers 788 914 -126 826 761 64 1.C.2 General government 22 245 -222 27 239 -212 2 Capital Account (2.1+2.2) 151 202 -51 186 192 -6 2.1 Gross acquisitions (DR.)/disposals (CR.) of non-produced nonfinancial assets 9 91 -82 7 68 -61 2.2 Capital transfers 142 110 31 179 124 55 3 Financial Account (3.1 to 3.5) 205657 195305 10352 307700 295815 11885 3.1 Direct Investment (3.1A+3.1B) 16586 17420 -834 21214 23452 -2238 3.1.A Direct Investment in India 15722 12686 3036 20666 15622 5044 3.1.A.1 Equity and investment fund shares 14617 12278 2339 19405 15016 4389 3.1.A.1.1 Equity other than reinvestment of earnings 9877 12278 -2401 13847 15016 -1169 3.1.A.1.2 Reinvestment of earnings 4740 4740 5559 5559 3.1.A.2 Debt instruments 1105 409 697 1261 606 655 3.1.A.2.1 Direct investor in direct investment enterprises 1105 409 697 1261 606 655 3.1.B Direct Investment by India 864 4734 -3870 548 7830 -7282 3.1.B.1 Equity and investment fund shares 864 3130 -2266 548 5827 -5279 3.1.B.1.1 Equity other than reinvestment of earnings 864 1683 -820 548 4313 -3765 3.1.B.1.2 Reinvestment of earnings 1446 -1446 1514 -1514 3.1.B.2 Debt instruments 0 1604 -1604 0 2003 -2003 3.1.B.2.1 Direct investor in direct investment enterprises 1604 -1604 2003 -2003 3.2 Portfolio Investment 111986 107040 4947 182108 162258 19850 3.2.A Portfolio Investment in India 111127 105841 5286 181433 161618 19815 3.2.1 Equity and investment fund shares 101529 97937 3593 160273 149590 10683 3.2.2 Debt securities 9598 7905 1693 21160 12028 9132 3.2.B Portfolio Investment by India 859 1198 -339 675 640 35 3.3 Financial derivatives (other than reserves) and employee stock options 5476 7362 -1887 6359 11892 -5533 3.4 Other investment 71609 60964 10645 98018 79598 18419 3.4.1 Other equity (ADRs/GDRs) 0 0 0 0 0 0 3.4.2 Currency and deposits 21257 18120 3137 29240 22753 6487 3.4.2.1 Central bank (Rupee Debt Movements; NRG) 0 72 -72 319 0 319 3.4.2.2 Deposit-taking corporations, except the central bank (NRI Deposits) 21257 18048 3209 28921 22753 6167 3.4.2.3 General government 0 0 3.4.2.4 Other sectors 0 0 3.4.3 Loans (External Assistance, ECBs and Banking Capital) 22828 23788 -960 44362 40589 3773 3.4.3.A Loans to India 19967 19813 153 39295 32531 6764 3.4.3.B Loans by India 2862 3975 -1113 5067 8058 -2991 3.4.4 Insurance, pension, and standardized guarantee schemes 144 10 134 47 3 44 3.4.5 Trade credit and advances 19662 14232 5430 17492 14129 3363 3.4.6 Other accounts receivable/payable - other 7718 4814 2903 6877 2124 4753 3.4.7 Special drawing rights 0 0 0 0 3.5 Reserve assets 0 2519 -2519 0 18614 -18614 3.5.1 Monetary gold 0 0 3.5.2 Special drawing rights n.a. 0 0 0 0 3.5.3 Reserve position in the IMF n.a. 0 0 3.5.4 Other reserve assets (Foreign Currency Assets) 0 2519 -2519 0 18614 -18614 4 Total assets/liabilities 205657 195305 10352 307700 295815 11885 4.1 Equity and investment fund shares 123488 121915 1574 187308 182969 4339 4.2 Debt instruments 74451 66057 8394 113515 92108 21407 4.3 Other financial assets and liabilities 7718 7333 385 6877 20738 -13861 5 Net errors and omissions 963 0 963 0 722 -722 Note: P: Preliminary. 150 RBI Bulletin February 2025CURRENT STATISTICS No. 41: Standard Presentation of BoP in India as per BPM6 (₹ Crore) Jul-Sep 2023 Jul-Sep 2024 (P) Item Credit Debit Net Credit Debit Net 1 2 3 4 5 6 1 Current Account (1.A+1.B+1.C) 1915018 2008132 -93114 2057899 2151355 -93457 1.A Goods and Services (1.A.a+1.A.b) 1583846 1787226 -203380 1654047 1911789 -257742 1.A.a Goods (1.A.a.1 to 1.A.a.3) 894849 1428380 -533531 870890 1501809 -630919 1.A.a.1 General merchandise on a BOP basis 887510 1324618 -437107 871011 1354507 -483496 1.A.a.2 Net exports of goods under merchanting 7339 0 7339 -121 0 -121 1.A.a.3 Nonmonetary gold 0 103763 -103763 0 147303 -147303 1.A.b Services (1.A.b.1 to 1.A.b.13) 688997 358846 330151 783157 409979 373178 1.A.b.1 Manufacturing services on physical inputs owned by others 2339 320 2019 2316 169 2147 1.A.b.2 Maintenance and repair services n.i.e. 465 2544 -2078 755 2199 -1444 1.A.b.3 Transport 58311 60151 -1840 73649 76965 -3316 1.A.b.4 Travel 61845 71601 -9756 63958 78464 -14506 1.A.b.5 Construction 7887 5598 2289 10580 7963 2616 1.A.b.6 Insurance and pension services 6842 6785 57 7553 6581 972 1.A.b.7 Financial services 17106 9777 7329 18349 10595 7754 1.A.b.8 Charges for the use of intellectual property n.i.e. 3485 27618 -24133 3754 32473 -28719 1.A.b.9 Telecommunications, computer, and information services 335161 41064 294097 375037 44672 330366 1.A.b.10 Other business services 177488 113019 64469 210894 130244 80650 1.A.b.11 Personal, cultural, and recreational services 10012 17193 -7180 9269 15029 -5760 1.A.b.12 Government goods and services n.i.e. 1154 2018 -863 1228 2643 -1415 1.A.b.13 Others n.i.e. 6902 1160 5742 5815 1982 3834 1.B Primary Income (1.B.1 to 1.B.3) 98510 194468 -95957 136323 216087 -79763 1.B.1 Compensation of employees 14544 7579 6965 16712 8568 8145 1.B.2 Investment income 73890 183473 -109583 107633 203850 -96217 1.B.2.1 Direct investment 19194 101520 -82327 22828 108966 -86138 1.B.2.2 Portfolio investment 692 30227 -29535 653 34776 -34123 1.B.2.3 Other investment 4298 49928 -45630 9783 58239 -48455 1.B.2.4 Reserve assets 49705 1797 47908 74369 1870 72499 1.B.3 Other primary income 10076 3415 6661 11978 3669 8309 1.C Secondary Income (1.C.1+1.C.2) 232662 26438 206224 267528 23480 244048 1.C.1 Financial corporations, nonfinancial corporations, households, and NPISHs 232476 24416 208060 267298 21478 245821 1.C.1.1 Personal transfers (Current transfers between resident and/non-resident households) 225958 16860 209099 260383 15102 245281 1.C.1.2 Other current transfers 6518 7557 -1039 6915 6376 539 1.C.2 General government 186 2022 -1836 230 2002 -1772 2 Capital Account (2.1+2.2) 1245 1668 -423 1558 1611 -53 2.1 Gross acquisitions (DR.)/disposals (CR.) of non-produced nonfinancial assets 74 755 -680 57 570 -513 2.2 Capital transfers 1170 913 257 1501 1041 460 3 Financial Account (3.1 to 3.5) 1699992 1614420 85572 2577489 2477933 99556 3.1 Direct Investment (3.1A+3.1B) 137100 143996 -6896 177706 196451 -18745 3.1.A Direct Investment in India 129962 104866 25096 173115 130862 42253 3.1.A.1 Equity and investment fund shares 120825 101488 19336 162551 125784 36767 3.1.A.1.1 Equity other than reinvestment of earnings 81644 101488 -19844 115988 125784 -9796 3.1.A.1.2 Reinvestment of earnings 39181 0 39181 46563 0 46563 3.1.A.2 Debt instruments 9137 3378 5759 10564 5078 5486 3.1.A.2.1 Direct investor in direct investment enterprises 9137 3378 5759 10564 5078 5486 3.1.B Direct Investment by India 7138 39130 -31992 4591 65589 -60998 3.1.B.1 Equity and investment fund shares 7138 25872 -18734 4591 48809 -44218 3.1.B.1.1 Equity other than reinvestment of earnings 7138 13916 -6778 4591 36128 -31537 3.1.B.1.2 Reinvestment of earnings 0 11956 -11956 0 12680 -12680 3.1.B.2 Debt instruments 0 13258 -13258 0 16780 -16780 3.1.B.2.1 Direct investor in direct investment enterprises 0 13258 -13258 0 16780 -16780 3.2 Portfolio Investment 925695 884807 40889 1525455 1359178 166277 3.2.A Portfolio Investment in India 918597 874902 43695 1519799 1353816 165984 3.2.1 Equity and investment fund shares 839257 809559 29698 1342550 1253064 89486 3.2.2 Debt securities 79340 65343 13997 177250 100752 76498 3.2.B Portfolio Investment by India 7099 9905 -2806 5656 5363 293 3.3 Financial derivatives (other than reserves) and employee stock options 45263 60858 -15595 53269 99618 -46349 3.4 Other investment 591934 503940 87993 821059 666767 154291 3.4.1 Other equity (ADRs/GDRs) 0 0 0 0 0 0 3.4.2 Currency and deposits 175715 149782 25933 244933 190597 54337 3.4.2.1 Central bank (Rupee Debt Movements; NRG) 0 594 -594 2675 0 2675 3.4.2.2 Deposit-taking corporations, except the central bank (NRI Deposits) 175715 149187 26528 242259 190597 51662 3.4.2.3 General government 0 0 0 0 0 0 3.4.2.4 Other sectors 0 0 0 0 0 0 3.4.3 Loans (External Assistance, ECBs and Banking Capital) 188702 196637 -7935 371605 339998 31607 3.4.3.A Loans to India 165048 163780 1267 329162 272501 56660 3.4.3.B Loans by India 23654 32857 -9202 42443 67497 -25054 3.4.4 Insurance, pension, and standardized guarantee schemes 1194 85 1109 393 25 368 3.4.5 Trade credit and advances 162529 117640 44888 146523 118354 28169 3.4.6 Other accounts receivable/payable - other 63794 39797 23998 57605 17794 39811 3.4.7 Special drawing rights 0 0 0 0 0 0 3.5 Reserve assets 0 20819 -20819 0 155919 -155919 3.5.1 Monetary gold 0 0 0 0 0 0 3.5.2 Special drawing rights n.a. 0 0 0 0 0 0 3.5.3 Reserve position in the IMF n.a. 0 0 0 0 0 0 3.5.4 Other reserve assets (Foreign Currency Assets) 0 20819 -20819 0 155919 -155919 4 Total assets/liabilities 1699992 1614420 85572 2577489 2477933 99556 4.1 Equity and investment fund shares 1020775 1007766 13008 1569010 1532662 36348 4.2 Debt instruments 615423 546038 69385 950874 771559 179316 4.3 Other financial assets and liabilities 63794 60616 3179 57605 173712 -116108 5 Net errors and omissions 7964 0 7964 0 6046 -6046 Note: P: Preliminary. RBI Bulletin February 2025 151CURRENT STATISTICS No. 42: India’s International Investment Position (US$ Million) Item As on Financial Year/Quarter End 2023-24 2023 2024 Sep. Jun. Sep. Assets Liabilities Assets Liabilities Assets Liabilities Assets Liabilities 1 2 3 4 5 6 7 8 1. Direct investment Abroad/in India 242271 542931 232097 528679 246248 552865 253530 555484 1.1 Equity Capital* 153343 511142 146159 497612 156225 520706 161504 523010 1.2 Other Capital 88927 31789 85938 31067 90023 32160 92026 32474 2. Portfolio investment 12162 277038 12096 259358 12103 277140 12306 293649 2.1 Equity 10644 162061 8974 154634 10367 160898 10983 170934 2.2 Debt 1517 114977 3122 104723 1736 116242 1323 122715 3. Other investment 132654 575068 120311 546182 140952 589624 146190 617176 3.1 Trade credit 33450 123662 30854 124733 32865 126576 32428 129931 3.2 Loan 17547 221738 11962 208669 20803 224823 22147 240166 3.3 Currency and Deposits 53519 154787 45711 146166 57747 160628 56105 164076 3.4 Other Assets/Liabilities 28138 74880 31784 66615 29537 77597 35510 83002 4. Reserves 646419 587714 651997 705782 5. Total Assets/ Liabilities 1033505 1395036 952218 1334219 1051300 1419629 1117808 1466309 6. Net IIP (Assets - Liabilities) -361531 -382001 -368329 -348501 Note: * Equity capital includes share of investment funds and reinvested earnings. 152 RBI Bulletin February 2025CURRENT STATISTICS Payment and Settlement Systems No.43: Payment System Indicators PART I - Payment System Indicators - Payment & Settlement System Statistics System Volume (Lakh) Value (₹ Crore) FY 2023-24 2023 2024 FY 2023-24 2023 2024 Dec. Nov. Dec. Dec. Nov. Dec. 1 -2 -1 0 5 2 3 4 A. Settlement Systems Financial Market Infrastructures (FMIs) 1 CCIL Operated Systems (1.1 to 1.3) 43.04 3.41 2.61 3.78 259206893 22228644 20592498 27448820 1.1 Govt. Securities Clearing (1.1.1 to 1.1.3) 16.80 1.29 1.10 1.49 170464587 14220985 13954925 16506680 1.1.1 Outright 9.51 0.69 0.54 0.84 13463848 1009116 847485 1348782 1.1.2 Repo 4.94 0.40 0.35 0.41 76718788 5903343 5366007 6377679 1.1.3 Tri-party Repo 2.35 0.20 0.20 0.24 80281951 7308526 7741434 8780219 1.2 Forex Clearing 24.92 2.01 1.40 2.16 80984671 7392675 5972544 9919285 1.3 Rupee Derivatives @ 1.31 0.11 0.11 0.13 7757636 614984 665029 1022855 B. Payment Systems I Financial Market Infrastructures (FMIs) - - - - - - - - 1 Credit Transfers - RTGS (1.1 to 1.2) 2700.16 230.39 240.29 262.29 170886670 15888778 14826882 19163587 1.1 Customer Transactions 2686.04 229.23 239.16 261.11 152406168 14244586 13504833 17161423 1.2 Interbank Transactions 14.12 1.16 1.12 1.17 18480503 1644192 1322050 2002163 II Retail 2 Credit Transfers - Retail (2.1 to 2.6) 1486106.89 134755.92 170358.50 183786.41 67542859 5917191 6274182 6935632 2.1 AePS (Fund Transfers) @ 3.92 0.32 0.30 0.31 261 23 14 17 2.2 APBS $ 25888.17 1580.49 2250.97 2451.41 390743 27013 32384 58705 2.3 IMPS 60053.35 4987.93 4079.18 4411.64 6495652 570126 558328 601549 2.4 NACH Cr $ 16227.27 1310.99 1438.33 1315.94 1525104 128244 147385 135695 2.5 NEFT 72639.50 6673.93 7769.51 8307.02 39136014 3368836 3380884 3814966 2.6 UPI @ 1311294.68 120202.26 154820.21 167300.09 19995086 1822949 2155187 2324700 2.6.1 of which USSD @ 26.19 2.06 1.56 1.56 352 26 16 16 3 Debit Transfers and Direct Debits (3.1 to 3.3) 18249.53 1557.74 1894.74 1905.47 1687658 152705 185643 198303 3.1 BHIM Aadhaar Pay @ 193.59 14.09 19.29 17.18 6112 478 629 547 3.2 NACH Dr $ 16426.49 1403.46 1732.94 1738.32 1678769 151991 184814 197549 3.3 NETC (linked to bank account) @ 1629.45 140.19 142.51 149.97 2777 237 200 207 4 Card Payments (4.1 to 4.2) 58469.79 4983.15 5171.02 5614.06 2423563 213054 208387 228757 4.1 Credit Cards (4.1.1 to 4.1.2) 35610.15 3215.00 3936.04 4331.22 1831134 165119 169298 188086 4.1.1 PoS based $ 18614.08 1706.70 2036.02 2242.76 651911 58300 68233 73185 4.1.2 Others $ 16996.08 1508.29 1900.02 2088.46 1179223 106819 101065 114901 4.2 Debit Cards (4.2.1 to 4.2.1 ) 22859.64 1768.16 1234.98 1282.84 592429 47935 39089 40671 4.2.1 PoS based $ 16477.95 1301.59 919.33 967.24 393589 32225 26756 27681 4.2.2 Others $ 6381.69 466.56 315.65 315.60 198840 15709 12333 12990 5 Prepaid Payment Instruments (5.1 to 5.2) 78775.40 7235.20 5847.81 6377.99 283048 26173 19214 18992 5.1 Wallets 63256.69 5960.57 4462.09 4830.75 234353 21732 13130 14437 5.2 Cards (5.2.1 to 5.2.2) 15518.71 1274.63 1385.72 1547.24 48695 4441 6083 4556 5.2.1 PoS based $ 8429.87 709.65 663.27 684.93 11247 915 915 991 5.2.2 Others $ 7088.84 564.98 722.45 862.31 37447 3526 5168 3565 6 Paper-based Instruments (6.1 to 6.2) 6632.10 547.23 472.48 506.56 7212333 592972 537849 587879 6.1 CTS (NPCI Managed) 6632.10 547.23 472.48 506.56 7212333 592972 537849 587879 6.2 Others 0.00 – – – – – – – Total - Retail Payments (2+3+4+5+6) 1648233.71 149079.24 183744.55 198190.49 79149461 6902095 7225275 7969563 Total Payments (1+2+3+4+5+6) 1650933.88 149309.63 183984.84 198452.78 250036131 22790873 22052158 27133149 Total Digital Payments (1+2+3+4+5) 1644301.78 148762.40 183512.36 197946.22 242823799 22197901 21514309 26545270 RBI Bulletin February 2025 153CURRENT STATISTICS PART II - Payment Modes and Channels System Volume (Lakh) Value (₹ Crore) FY 2023-24 2023 2024 FY 2023-24 2023 2024 Dec. Nov. Dec. Dec. Nov. Dec. 1 2 3 4 5 6 7 8 A. Other Payment Channels 1 Mobile Payments (mobile app based) (1.1 to 1.2) 1252599.21 116329.75 144940.05 156761.97 30687088 2804467 3215460 3455692 1.1 Intra-bank $ 83000.56 7372.04 8518.57 9183.18 5676805 508669 598558 618348 1.2 Inter-bank $ 1169598.65 108957.71 136421.48 147578.78 25010283 2295798 2616902 2837344 2 Internet Payments (Netbanking / Internet Browser Based) @ (2.1 to 2.2) 45034.98 3836.26 3624.01 4036.42 102117736 9388620 9002230 11058871 2.1 Intra-bank @ 12033.28 1050.96 1024.09 1153.98 53247042 4862570 4483631 5617543 2.2 Inter-bank @ 33001.71 2785.31 2599.92 2882.45 48870694 4526051 4518598 5441328 B. ATMs 3 Cash Withdrawal at ATMs $ (3.1 to 3.3) 66440.72 5463.60 4760.71 4950.77 3259388 269288 241717 252471 3.1 Using Credit Cards $ 95.80 8.19 7.75 8.12 4648 405 410 429 3.2 Using Debit Cards $ 66001.01 5428.47 4734.61 4923.54 3241538 267843 240471 251161 3.3 Using Pre-paid Cards $ 343.90 26.94 18.35 19.11 13202 1041 837 881 4 Cash Withdrawal at PoS $ (4.1 to 4.2) 15.18 0.66 0.28 0.29 148 6 3 3 4.1 Using Debit Cards $ 15.06 0.66 0.27 0.26 147 6 3 3 4.2 Using Pre-paid Cards $ 0.12 0.00 0.02 0.03 1 0 0 0 5 Cash Withrawal at Micro ATMs @ 11754.95 929.51 898.33 910.87 314003 24592 22981 23195 5.1 AePS @ 11754.95 929.51 898.33 910.87 314003 24592 22981 23195 PART III - Payment Infrastructures (Lakh) System As on March 2023 2024 2024 Dec. Nov. Dec. 1 2 3 4 Payment System Infrastructures 1 Number of Cards (1.1 to 1.2) 10667.22 10587.85 10868.11 10990.04 1.1 Credit Cards 1018.03 979.05 1072.40 1080.56 1.2 Debit Cards 9649.19 9608.81 9795.72 9909.48 2 Number of PPIs @ (2.1 to 2.2) 16743.63 17544.34 15624.08 13285.65 2.1 Wallets @ 13381.80 14293.01 11460.53 8904.25 2.2 Cards @ 3361.82 3251.33 4163.55 4381.40 3 Number of ATMs (3.1 to 3.2) 2.58 2.58 2.55 2.55 3.1 Bank owned ATMs $ 2.23 2.24 2.20 2.19 3.2 White Label ATMs $ 0.35 0.34 0.35 0.36 4 Number of Micro ATMs @ 17.55 16.89 14.43 14.67 5 Number of PoS Terminals 89.03 85.67 96.91 100.01 6 Bharat QR @ 62.50 59.57 63.60 63.83 7 UPI QR * 3434.93 3170.66 6260.92 6334.39 @: New inclusion w.e.f. November 2019 #: Data reported by Co-operative Banks, LABs and RRBs included with effect from December 2021. $ : Inclusion separately initiated from November 2019 - would have been part of other items hitherto. *: New inclusion w.e.f. September 2020; Includes only static UPI QR Code Note : 1. Data is provisional. 2. ECS (Debit and Credit) has been merged with NACH with effect from January 31, 2020. 3. The data from November 2019 onwards for card payments (Debit/Credit cards) and Prepaid Payment Instruments (PPIs) may not be comparable with earlier months/ periods, as more granular data is being published along with revision in data definitions. 4. Only domestic financial transactions are considered. The new format captures e-commerce transactions; transactions using FASTags, digital bill payments and card-to-card transfer through ATMs, etc. Also, failed transactions, chargebacks, reversals, expired cards/ wallets, are excluded. Part I-A. Settlement systems 1.1.3: Tri- party Repo under the securities segment has been operationalised from November 05, 2018. Part I-B. Payments systems 4.1.2: ‘Others’ includes e-commerce transactions and digital bill payments through ATMs, etc. 4.2.2: ‘Others’ includes e-commerce transactions, card to card transfers and digital bill payments through ATMs, etc. 5. Available from December 2010. 5.1: includes purchase of goods and services and fund transfer through wallets. 5.2.2: includes usage of PPI Cards for online transactions and other transactions. 6.1: Pertain to three grids – Mumbai, New Delhi and Chennai. 6.2: ‘Others’ comprises of Non-MICR transactions which pertains to clearing houses managed by 21 banks. Part II-A. Other payment channels 1: Mobile Payments – o Include transactions done through mobile apps of banks and UPI apps. o The data from July 2017 includes only individual payments and corporate payments initiated, processed, and authorised using mobile device. Other corporate payments which are not initiated, processed, and authorised using mobile device are excluded. 2: Internet Payments – includes only e-commerce transactions through ‘netbanking’ and any financial transaction using internet banking website of the bank. Part II-B. ATMs ` 3.3 and 4.2: only relates to transactions using bank issued PPIs. Part III. Payment systems infrastructure 3: Includes ATMs deployed by Scheduled Commercial Banks (SCBs) and White Label ATM Operators (WLAOs). WLAs are included from April 2014 onwards. 154 RBI Bulletin February 2025CURRENT STATISTICS OOOccccccaaasssiiiooonnnaaalll SSSeeerrriiieeesss No. 44: Small Savings (₹ Crore) Scheme 2023-24 2023 2024 Dec. Oct. Nov. Dec. 1 2 3 4 5 1 Small Savings Receipts 232460 16670 10981 9805 11133 Outstanding 1865029 1789946 1962367 1971752 1982465 1.1 Total Deposits Receipts 161344 12386 8792 7469 8734 Outstanding 1298795 1247555 1379283 1386750 1395484 1.1.1 Post Office Saving Bank Deposits Receipts 17229 2279 1062 20 1090 Outstanding 191692 213964 200889 200909 201999 1.1.2 Sukanya Samriddhi Yojna Receipts 35174 2171 1787 1944 2244 Outstanding 157611 104859 172819 174763 177007 1.1.3 National Saving Scheme, 1987 Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.1.4 National Saving Scheme, 1992 Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.1.5 Monthly Income Scheme Receipts 26696 1713 1033 900 827 Outstanding 269007 263383 280416 281316 282142 1.1.6 Senior Citizen Scheme 2004 Receipts 38167 2197 1699 1609 1531 Outstanding 175472 169033 191465 193074 194605 1.1.7 Post Office Time Deposits Receipts 25341 2429 2121 2109 2125 Outstanding 305776 297989 326679 328786 330912 1.1.7.1 1 year Time Deposits Outstanding 140423 135196 155580 157349 159174 1.1.7.2 2 year Time Deposits Outstanding 11967 11265 13910 14093 14299 1.1.7.3 3 year Time Deposits Outstanding 8932 8472 10033 10166 10308 1.1.7.4 5 year Time Deposits Outstanding 144454 143056 147156 147178 147131 1.1.8 Post Office Recurring Deposits Receipts 18713 1616 1238 1023 1025 Outstanding 197134 196491 205221 206244 207269 1.1.9 Post Office Cumulative Time Deposits Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.1.10 Other Deposits Receipts 8 -19 -149 -137 -108 Outstanding 1754 1488 1440 1303 1195 1.1.11 PM Care for children Receipts 16 0 1 1 0 Outstanding 349 348 354 355 355 1.2 Saving Certificates Receipts 56069 3957 2080 2184 2226 Outstanding 418021 407244 434502 436268 438074 1.2.1 National Savings Certificate VIII issue Receipts 16853 1213 637 524 430 Outstanding 183905 177154 191667 192191 192621 1.2.2 Indira Vikas Patras Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.2.3 Kisan Vikas Patras Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.2.4 Kisan Vikas Patras - 2014 Receipts 20939 1568 783 932 1113 Outstanding 220560 216509 226662 227594 228707 1.2.5 National Saving Certificate VI issue Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.2.6 National Saving Certificate VII issue Receipts 0 0 0 0 0 Outstanding 0 0 0 0 0 1.2.7 M.S. Certificates Receipts 18277 1176 660 728 683 Outstanding 18277 15064 23891 24620 25303 1.2.8 Other Certificates Outstanding -4721 -1483 -7718 -8137 -8557 1.3 Public Provident Fund Receipts 15047 327 109 152 173 Outstanding 148213 135147 148582 148734 148907 Note : Data on receipts from April 2017 are net receipts, i.e., gross receipt minus gross payment. Source: Accountant General, Post and Telegraphs. RBI Bulletin February 2025 155CURRENT STATISTICS No. 45 : Ownership Pattern of Central and State Governments Securities (Per cent) Central Government Dated Securities 2023 2024 Category Sep. Dec. Mar. Jun. Sep. 1 2 3 4 5 (A) Total (in ₹. Crore) 10383607 10538792 10740389 10946860 11271589 1 Commercial Banks 37.96 37.55 37.66 37.52 37.55 2 Co-operative Banks 1.52 1.49 1.47 1.42 1.35 3 Non-Bank PDs 0.66 0.67 0.66 0.70 0.77 4 Insurance Companies 26.05 26.16 25.98 26.11 25.95 5 Mutual Funds 3.02 3.03 2.90 2.87 3.14 6 Provident Funds 4.42 4.57 4.47 4.41 4.25 7 Pension Funds 4.32 4.44 4.52 4.74 4.86 8 Financial Institutions 0.54 0.55 0.55 0.57 0.63 9 Corporates 1.21 1.33 1.35 1.44 1.60 10 Foreign Portfolio Investors 1.61 1.92 2.34 2.34 2.80 11 RBI 13.06 12.54 12.31 11.92 11.16 12 Others 5.64 5.74 5.79 5.97 5.92 12.1 State Governments 2.04 2.07 2.04 2.13 2.19 State Governments Securities 2023 2024 Category Sep. Dec. Mar. Jun. Sep. 1 2 3 4 5 (B) Total (in ₹. Crore) 5161642 5338587 5646219 5727482 5909490 1 Commercial Banks 33.87 33.90 34.14 33.85 34.39 2 Co-operative Banks 3.60 3.53 3.39 3.38 3.29 3 Non-Bank PDs 0.61 0.63 0.60 0.59 0.60 4 Insurance Companies 26.97 26.64 26.14 25.85 25.56 5 Mutual Funds 1.86 2.00 2.09 2.08 1.93 6 Provident Funds 21.70 22.00 22.35 22.94 23.02 7 Pension Funds 4.82 4.56 4.76 4.87 4.87 8 Financial Institutions 1.65 1.63 1.59 1.58 1.57 9 Corporates 1.87 2.03 2.02 2.03 1.95 10 Foreign Portfolio Investors 0.02 0.03 0.07 0.05 0.04 11 RBI 0.69 0.66 0.63 0.62 0.60 12 Others 2.34 2.37 2.20 2.17 2.18 12.1 State Governments 0.27 0.27 0.25 0.26 0.26 Treasury Bills 2023 2024 Category Sep. Dec. Mar. Jun. Sep. 1 2 3 4 5 (C) Total (in ₹. Crore) 925317 849151 871662 858193 747242 1 Commercial Banks 56.35 57.18 58.53 47.79 44.74 2 Co-operative Banks 1.20 1.28 1.67 1.49 1.58 3 Non-Bank PDs 0.54 1.70 1.66 2.69 2.28 4 Insurance Companies 5.26 5.50 5.06 5.78 5.26 5 Mutual Funds 12.74 11.21 11.89 14.50 15.06 6 Provident Funds 1.52 0.08 0.15 0.60 0.26 7 Pension Funds 0.01 0.00 0.01 0.00 0.00 8 Financial Institutions 4.10 5.34 7.16 6.56 6.36 9 Corporates 4.00 4.58 4.50 4.79 4.66 10 Foreign Portfolio Investors 0.10 0.07 0.01 0.20 0.15 11 RBI 0.00 0.00 0.00 0.00 0.00 12 Others 14.17 13.06 9.36 15.59 19.65 12.1 State Governments 11.36 9.26 5.88 11.55 14.95 Note: The table format is revised since monthly Bulletin for the month of June 2023. Central Government Dated Securities include special securities and Sovereign Gold Bonds. State Government Securities include special bonds issued under Ujwal DISCOM Assurance Yojana (UDAY). Bank PDs are clubbed under Commercial Banks. The category ‘Others’ comprises State Governments, DICGC, PSUs, Trusts, Foreign Central Banks, HUF/ Individuals etc. Data since September 2023 includes the impact of the merger of a non-bank with a bank. 156 RBI Bulletin February 2025CURRENT STATISTICS No. 46: Combined Receipts and Disbursements of the Central and State Governments (₹ Crore) Item 2019-20 2020-21 2021-22 2022-23 2023-24 RE 2024-25 BE 1 2 3 4 5 6 1 Total Disbursements 5410887 6353359 7098451 7880522 9110725 9800798 1.1 Developmental 3074492 3823423 4189146 4701611 5514584 5862996 1.1.1 Revenue 2446605 3150221 3255207 3574503 3965270 4195108 1.1.2 Capital 588233 550358 861777 1042159 1453849 1526993 1.1.3 Loans 39654 122844 72163 84949 95464 140895 1.2 Non-Developmental 2253027 2442941 2810388 3069896 3467270 3800321 1.2.1 Revenue 2109629 2271637 2602750 2895864 3266628 3537378 1.2.1.1 Interest Payments 955801 1060602 1226672 1377807 1562660 1711972 1.2.2 Capital 141457 169155 175519 171131 196073 259346 1.2.3 Loans 1941 2148 32119 2902 4569 3597 1.3 Others 83368 86995 98916 109015 128871 137481 2 Total Receipts 5734166 6397162 7156342 7855370 9054999 9650488 2.1 Revenue Receipts 3851563 3688030 4823821 5447913 6379349 7209647 2.1.1 Tax Receipts 3231582 3193390 4160414 4809044 5456913 6142276 2.1.1.1 Taxes on commodities and services 2012578 2076013 2626553 2865550 3248450 3631569 2.1.1.2 Taxes on Income and Property 1216203 1114805 1530636 1939550 2204462 2506181 2.1.1.3 Taxes of Union Territories (Without Legislature) 2800 2572 3225 3943 4001 4526 2.1.2 Non-Tax Receipts 619981 494640 663407 638870 922436 1067371 2.1.2.1 Interest Receipts 31137 33448 35250 42975 49552 57273 2.2 Non-debt Capital Receipts 110094 64994 44077 62716 86733 118239 2.2.1 Recovery of Loans & Advances 59515 16951 27665 15970 55895 45125 2.2.2 Disinvestment proceeds 50578 48044 16412 46746 30839 73114 3 Gross Fiscal Deficit [ 1 - ( 2.1 + 2.2 ) ] 1449230 2600335 2230553 2369892 2644642 2472912 3A Sources of Financing: Institution-wise 3A.1 Domestic Financing 1440548 2530155 2194406 2332768 2619811 2456959 3A.1.1 Net Bank Credit to Government 571872 890012 627255 687904 346483 ... 3A.1.1.1 Net RBI Credit to Government 190241 107493 350911 529 -257913 ... 3A.1.2 Non-Bank Credit to Government 868676 1640143 1567151 1644864 2273328 ... 3A.2 External Financing 8682 70180 36147 37124 24832 15952 3B Sources of Financing: Instrument-wise 3B.1 Domestic Financing 1440548 2530155 2194406 2332768 2619811 2456959 3B.1.1 Market Borrowings (net) 971378 1696012 1213169 1651076 1962969 1983757 3B.1.2 Small Savings (net) 209232 458801 526693 358764 434151 447511 3B.1.3 State Provident Funds (net) 38280 41273 28100 13880 21386 19857 3B.1.4 Reserve Funds 10411 4545 42153 68803 52385 -33653 3B.1.5 Deposits and Advances -14227 25682 42203 51989 35819 -10138 3B.1.6 Cash Balances -323279 -43802 -57891 25152 55726 150310 3B.1.7 Others 548753 347643 399980 163104 57374 -100684 3B.2 External Financing 8682 70180 36147 37124 24832 15952 4 Total Disbursements as per cent of GDP 26.9 32.0 30.1 29.2 30.8 30.0 5 Total Receipts as per cent of GDP 28.5 32.2 30.3 29.1 30.7 29.6 6 Revenue Receipts as per cent of GDP 19.2 18.6 20.4 20.2 21.6 22.1 7 Tax Receipts as per cent of GDP 16.1 16.1 17.6 17.8 18.5 18.8 8 Gross Fiscal Deficit as per cent of GDP 7.2 13.1 9.5 8.8 9.0 7.6 … : Not available; RE: Revised Estimates; BE: Budget Estimates Source : Budget Documents of Central and State Governments. Note: GDP data is based on 2011-12 base. GDP for 2024-25 is from Union Budget 2024-25. Data pertains to all States and Union Territories. 1 & 2: Data are net of repayments of the Central Government (including repayments to the NSSF) and State Governments. 1.3: Represents compensation and assignments by States to local bodies and Panchayati Raj institutions. 2: Data are net of variation in cash balances of the Central and State Governments and includes borrowing receipts of the Central and State Governments. 3A.1.1: Data as per RBI records. 3B.1.1: Borrowings through dated securities. 3B.1.2: Represent net investment in Central and State Governments’ special securities by the National Small Savings Fund (NSSF). This data may vary from previous publications due to adjustments across components with availability of new data. 3B.1.6: Include Ways and Means Advances by the Centre to the State Governments. 3B.1.7: Include Treasury Bills, loans from financial institutions, insurance and pension funds, remittances, cash balance investment account. RBI Bulletin February 2025 157CURRENT STATISTICS No. 47: Financial Accommodation Availed by State Governments under various Facilities (₹ Crore) During December-2024 Sr. State/Union Territory Special Drawing Ways and Means Overdraft (OD) No Facility (SDF) Advances (WMA) Average Number Average Number Average Number amount of days amount of days amount of days availed availed availed availed availed availed 1 2 3 4 5 6 7 1 Andhra Pradesh 6228.59 31 1990.27 24 1387.58 12 2 Arunachal Pradesh - - - - - - 3 Assam 198.83 1 - - - - 4 Bihar - - - - - - 5 Chhattisgarh - - - - - - 6 Goa - - - - - - 7 Gujarat - - - - - - 8 Haryana 671.48 23 - - - - 9 Himachal Pradesh - - 569.66 18 369.45 7 10 Jammu & Kashmir UT - - 334.57 1 - - 11 Jharkhand - - - - - - 12 Karnataka - - - - - - 13 Kerala 1553.11 31 1481.92 30 402.31 9 14 Madhya Pradesh - - - - - - 15 Maharashtra - - - - - - 16 Manipur 104.86 30 237.83 30 83.26 10 17 Meghalaya 472.99 29 6.09 2 - - 18 Mizoram 185.00 5 50.26 2 - - 19 Nagaland 315.96 28 - - - - 20 Odisha - - - - - - 21 Puducherry - - - - - - 22 Punjab 3680.79 31 142.76 6 - - 23 Rajasthan 2669.90 16 1353.46 8 - - 24 Tamil Nadu - - - - - - 25 Telangana 4560.57 31 1776.29 24 591.71 15 26 Tripura - - - - - - 27 Uttar Pradesh - - - - - - 28 Uttarakhand 1323.91 31 559.52 1 - - 29 West Bengal - - - - - - Notes: 1. SDF is availed by State Governments against the collateral of Consolidated Sinking Fund (CSF), Guarantee Redemption Fund (GRF) & Auction Treasury Bills (ATBs) balances and other investments in government securities. 2. WMA is advance by Reserve Bank of India to State Governments for meeting temporary cash mismatches. 3. OD is advanced to State Governments beyond their WMA limits. 4. Average Availed is the total accommodation (SDF/WMA/OD) availed divided by number of days for which accommodation was extended during the month. 5. -Nil. Source: Reserve Bank of India. 158 RBI Bulletin February 2025CURRENT STATISTICS No. 48: Investments by State Governments (₹ Crore) As on end of December 2024 Consolidated Guarantee Sr. State/Union Government Auction Treasury Sinking Redemption No Territory Securities Bills (ATBs) Fund (CSF) Fund (GRF) 1 2 3 4 5 1 Andhra Pradesh 11485 1132 0 0 2 Arunachal Pradesh 2735 7 0 6300 3 Assam 8865 90 0 0 4 Bihar 12394 - 0 20000 5 Chhattisgarh 7754 488 0 11387 6 Goa 1043 454 0 0 7 Gujarat 15244 662 0 2000 8 Haryana 2315 1688 0 0 9 Himachal Pradesh - - 0 0 10 Jammu & Kashmir UT 19 18 0 0 11 Jharkhand 2396 - 0 830 12 Karnataka 20131 747 0 69457 13 Kerala 3098 - 0 0 14 Madhya Pradesh - 1268 0 0 15 Maharashtra 71372 1734 0 0 16 Manipur 69 139 0 0 17 Meghalaya 1267 108 0 0 18 Mizoram 456 63 0 0 19 Nagaland 1877 46 0 0 20 Odisha 18082 2029 116 5534 21 Puducherry 575 - 0 1750 22 Punjab 9114 0 0 0 23 Rajasthan 1774 - 0 6450 24 Tamil Nadu 3434 - 0 3612 25 Telangana 7843 1715 0 0 26 Tripura 1215 27 0 25 27 Uttarakhand 4988 210 0 0 28 Uttar Pradesh 10647 - 0 25000 29 West Bengal 13740 1026 0 500 Total 233932 13651 116 152845 Notes: 1. CSF and GRF are reserve funds maintained by some State Governments with the Reserve Bank of India. 2. ATBs include Treasury bills of 91 days, 182 days and 364 days invested by State Governments in the primary market. 3. - : Not Applicable (not a member of the scheme). RBI Bulletin February 2025 159CURRENT STATISTICS No. 49: Market Borrowings of State Governments (₹ Crore) 2024-25 Total amount 2022-23 2023-24 raised, so far in October November December 2024-25 Sr. No. State Gross Net Gross Net Gross Net Gross Net Gross Net Amount Amount Amount Amount Amount Amount Amount Amount Amount Amount Gross Net Raised Raised Raised Raised Raised Raised Raised Raised Raised Raised 1 2 3 4 5 6 7 8 9 10 11 12 13 1 Andhra Pradesh 57478 45814 68400 55330 6000 4000 4000 2000 4237 3237 58237 40155 2 Arunachal Pradesh 559 389 902 672 - - 400 400 395 315 795 569 3 Assam 17100 16105 18500 16000 1500 1000 - -500 1800 1100 11050 8400 4 Bihar 36800 27467 47612 29910 8000 3000 6000 3000 6000 3500 32000 19422 5 Chhattisgarh 2000 -2287 32000 26213 3000 2300 - - - - 6500 3000 6 Goa 1350 500 2550 1560 200 100 200 100 - - 1050 250 7 Gujarat 43000 28300 30500 11947 1500 -500 3000 1000 4500 2000 13500 3000 8 Haryana 45158 28638 47500 28364 1500 750 4000 3500 2000 1150 27000 19870 9 Himachal Pradesh 14000 11941 8072 5856 600 200 500 300 1000 900 6700 4750 10 Jammu & Kashmir UT 8473 5969 16337 13904 400 -40 400 400 1600 1600 11750 10410 11 Jharkhand 4000 -155 1000 -2505 - - - - - -750 - -750 12 Karnataka 36000 26000 81000 63003 20000 18000 4000 1500 16000 13500 43000 29500 13 Kerala 30839 15620 42438 26638 2745 1245 2249 1249 2755 2455 32002 19802 14 Madhya Pradesh 40158 26849 38500 26264 5000 4000 5000 4250 5000 4250 30000 22900 15 Maharashtra 72000 42815 110000 79738 3000 600 - -2700 - -3100 67000 41700 16 Manipur 1422 1147 1426 1076 200 - - - 200 200 1000 740 17 Meghalaya 1753 1356 1364 912 197 197 - - 635 535 1882 1294 18 Mizoram 1315 1129 901 641 50 50 80 60 140 40 811 581 19 Nagaland 1854 1199 2551 2016 - - - -150 250 250 550 200 20 Odisha 0 -7500 0 -4658 - -500 1000 1000 - - 1000 -500 21 Puducherry 1200 698 1100 475 300 300 - -100 350 350 900 500 22 Punjab 45500 33660 42386 29517 3150 3150 387 387 2500 2200 32930 28176 23 Rajasthan 46057 30110 73624 49718 7000 5230 4265 3015 4800 3800 52565 36483 24 Sikkim 1414 1320 1916 1701 1000 1000 - - - - 1000 870 25 Tamil Nadu 87000 65722 113001 75970 8000 3150 9025 5400 11000 10000 78025 53175 26 Telangana 40150 30922 49618 39385 4500 3700 1000 200 3500 2500 40500 31982 27 Tripura 0 -645 0 -550 - - - - - - - - 28 Uttar Pradesh 55612 41797 97650 85335 3000 24 6000 3500 12000 8422 21000 7713 29 Uttarakhand 3200 1450 6300 3800 500 500 500 500 1000 - 3400 2400 30 West Bengal 63000 42500 69910 48910 3500 2000 3000 1000 7000 5000 38000 22900 Grand Total 758392 518829 1007058 717140 84842 53457 55006 29311 88662 63454 614147 409492 - : Nil. Note: The State of J&K has ceased to exist constitutionally from October 31, 2019 and the liabilities of the State continue to remain as liabilities of the new UT of Jammu and Kashmir. Source: Reserve Bank of India. 160 RBI Bulletin February 2025CURRENT STATISTICS No. 50 (a): Flow of Financial Assets and Liabilities of Households - Instrument-wise (Amount in ` Crore) 2021-22 Item Q1 Q2 Q3 Q4 Annual Net Financial Assets (I-II) 3,42,813 3,30,490 4,85,203 5,54,816 17,13,322 Per cent of GDP 6.6 5.9 7.7 8.5 7.3 I. Financial Assets 3,63,395 5,25,419 8,16,484 9,07,366 26,12,664 Per cent of GDP 7.0 9.3 13.0 13.9 11.1 of which: 1.Total Deposits (a)+(b) (81,064) 2,04,486 4,28,035 2,83,634 8,35,091 (a) Bank Deposits (1,06,429) 1,97,105 4,22,393 2,70,025 7,83,094 i. Commercial Banks (1,07,941) 1,95,442 4,18,267 2,62,326 7,68,094 ii. Co-operative Banks 1,512 1,663 4,126 7,699 15,000 (b) Non-Bank Deposits 25,365 7,380 5,642 13,610 51,997 of which: Other Financial Institutions (i+ii) 17,555 (435) (2,178) 5,770 20,712 i. Non-Banking Financial Companies 5,578 (1,371) 73 4,021 8,302 ii. Housing Finance Companies 11,977 936 (2,252) 1,748 12,410 2. Life Insurance Funds 1,15,539 1,28,277 1,04,076 1,38,998 4,86,889 3. Provident and Pension Funds (including PPF) 1,24,971 1,12,810 95,493 2,18,719 5,51,993 4. Currency 1,28,660 (68,631) 62,793 1,46,845 2,69,667 5. Investments 24,884 82,260 69,715 50,926 2,27,785 of which: (a) Mutual Funds 14,573 63,151 37,912 44,964 1,60,600 (b) Equity 4,502 13,218 27,808 3,084 48,613 6. Small Savings (excluding PPF) 50,405 66,218 56,372 68,243 2,41,238 II. Financial Liabilities 20,583 1,94,929 3,31,281 3,52,550 8,99,343 Per cent of GDP 0.4 3.5 5.3 5.4 3.8 Loans (Borrowings) from 1. Financial Corporations (a+b) 20,479 1,94,825 3,31,178 3,52,446 8,98,928 (a) Banking Sector 21,428 1,38,720 2,67,955 2,74,181 7,02,284 of which: i. Commercial Banks 26,979 1,40,269 2,65,271 3,37,010 7,69,529 (b) Other Financial Institutions (949) 56,105 63,223 78,266 1,96,644 i. Non-Banking Financial Companies (8,708) 30,151 32,177 40,003 93,623 ii. Housing Finance Companies 7,132 24,404 29,495 37,436 98,467 iii. Insurance Corporations 627 1,550 1,551 827 4,554 2. Non-Financial Corporations (Private 34 34 34 34 135 Corporate Business) 3. General Government 70 70 70 70 279 RBI Bulletin February 2025 161CURRENT STATISTICS No. 50 (a): Flow of Financial Assets and Liabilities of Households - Instrument-wise (Contd.) (Amount in ` Crore) 2022-23 Item Q1 Q2 Q3 Q4 Annual Net Financial Assets (I-II) 2,89,980 2,99,395 2,96,132 4,54,240 13,39,748 Per cent of GDP 4.5 4.6 4.3 6.4 5.0 I. Financial Assets 5,79,958 6,34,471 7,50,245 9,71,526 29,36,200 Per cent of GDP 8.9 9.8 10.9 13.6 10.9 of which: 1.Total Deposits (a)+(b) 1,85,429 3,17,361 2,80,233 3,25,853 11,08,876 (a) Bank Deposits 1,63,172 2,99,533 2,56,400 3,07,867 10,26,971 i. Commercial Banks 1,58,613 3,00,565 2,48,460 2,84,968 9,92,606 ii. Co-operative Banks 4,559 (1,032) 7,940 22,899 34,365 (b) Non-Bank Deposits 22,257 17,829 23,833 17,986 81,905 of which: Other Financial Institutions (i+ii) 6,505 2,077 8,082 2,234 18,897 i. Non-Banking Financial Companies 4,231 3,267 3,247 3,946 14,690 ii. Housing Finance Companies 2,274 (1,191) 4,835 (1,712) 4,207 2. Life Insurance Funds 73,298 1,51,677 1,67,522 1,56,613 5,49,109 3. Provident and Pension Funds (including PPF) 1,48,915 1,20,367 1,38,584 2,18,709 6,26,575 4. Currency 66,439 (54,579) 76,760 1,48,990 2,37,610 5. Investments 51,503 48,530 49,779 64,151 2,13,962 of which: (a) Mutual Funds 35,443 44,484 40,206 58,955 1,79,088 (b) Equity 13,561 1,378 6,434 1,665 23,038 6. Small Savings (excluding PPF) 54,375 51,115 37,368 57,211 2,00,068 II. Financial Liabilities 2,89,978 3,35,076 4,54,113 5,17,285 15,96,452 Per cent of GDP 4.5 5.2 6.6 7.3 5.9 Loans (Borrowings) from 1. Financial Corporations (a+b) 2,89,781 3,34,880 4,53,917 5,17,089 15,95,667 (a) Banking Sector 2,34,235 2,63,450 3,70,783 3,83,845 12,52,313 of which: i. Commercial Banks 2,30,284 2,61,265 3,68,305 3,31,293 11,91,146 (b) Other Financial Institutions 55,546 71,429 83,134 1,33,244 3,43,354 i. Non-Banking Financial Companies 30,532 36,650 55,792 94,565 2,17,539 ii. Housing Finance Companies 22,337 33,031 24,903 36,746 1,17,017 iii. Insurance Corporations 2,678 1,748 2,439 1,933 8,798 2. Non-Financial Corporations (Private 34 34 34 34 135 Corporate Business) 3. General Government 163 163 163 163 650 162 RBI Bulletin February 2025CURRENT STATISTICS No. 50 (a): Flow of Financial Assets and Liabilities of Households - Instrument-wise (Concld.) (Amount in ` Crore) 2023-24 Item Q1 Q2 Q3 Q4 Annual Net Financial Assets (I-II) 3,53,093 2,89,675 2,98,111 6,11,366 15,52,245 Per cent of GDP 5.0 4.1 3.9 7.8 5.3 I. Financial Assets 6,74,763 8,15,842 8,08,779 11,32,130 34,31,514 Per cent of GDP 9.6 11.5 10.7 14.5 11.6 of which: 1.Total Deposits (a)+(b) 2,68,925 4,12,388 2,99,372 4,10,559 13,91,244 (a) Bank Deposits 2,55,249 5,06,208 2,79,872 3,94,573 14,35,902 i. Commercial Banks 2,46,079 5,06,700 2,82,537 3,87,313 14,22,629 ii. Co-operative Banks 9,170 (492) (2,665) 7,260 13,273 (b) Non-Bank Deposits 13,676 (93,820) 19,499 15,986 (44,658) of which: Other Financial Institutions (i+ii) (485) (1,07,982) 5,338 1,825 (1,01,305) i. Non-Banking Financial Companies 6,119 4,782 4,896 1,943 17,740 ii. Housing Finance Companies (6,605) (1,12,764) 442 (118) (1,19,045) 2. Life Insurance Funds 1,58,358 1,41,413 1,61,192 1,30,036 5,90,999 3. Provident and Pension Funds (including PPF) 1,63,508 1,48,178 1,53,255 2,53,719 7,18,661 4. Currency (48,636) (36,701) 56,719 1,46,644 1,18,026 5. Investments 41,409 73,060 79,633 1,08,732 3,02,834 of which: (a) Mutual Funds 32,086 55,769 60,135 90,973 2,38,962 (b) Equity 3,757 7,146 9,941 8,236 29,080 6. Small Savings (excluding PPF) 91,198 77,504 58,607 82,441 3,09,751 II. Financial Liabilities 3,21,670 5,26,167 5,10,667 5,20,764 18,79,269 Per cent of GDP 4.6 7.4 6.7 6.7 6.4 Loans (Borrowings) from 1. Financial Corporations (a+b) 3,21,520 5,26,016 5,10,516 5,20,613 18,78,666 (a) Banking Sector 2,13,606 8,68,874 4,02,647 3,92,330 18,77,458 of which: i. Commercial Banks 2,08,027 8,75,654 3,89,898 3,82,558 18,56,136 (b) Other Financial Institutions 1,07,914 (3,42,858) 1,07,869 1,28,283 1,208 i. Non-Banking Financial Companies 81,449 59,684 85,032 1,00,836 3,27,001 ii. Housing Finance Companies 23,784 (4,04,294) 21,233 25,853 (3,33,424) iii. Insurance Corporations 2,681 1,753 1,604 1,594 7,631 2. Non-Financial Corporations (Private 34 35 35 35 138 Corporate Business) 3. General Government 116 116 116 116 465 Notes : 1. Net Financial Savings of households refer to the net financial assets, which are measured as difference of financial asset and liabilities flows. 2. Preliminary estimates for 2023-24 and revised estimates for 2021-22 and 2022-23. 3. The preliminary estimates for 2023-24 will undergo revision with the release of first revised estimates of national income, consumption expenditure, savings, and capital formation, 2023-24 by the National Statistical Office (NSO). 4. Non-bank deposits apart from other financial institutions, comprises state power utilities, co-operative non credit societies etc. 5. Figures in the columns may not add up to the total due to rounding off. RBI Bulletin February 2025 163CURRENT STATISTICS No. 50 (b): Stocks of Financial Assets and Liabilities of Households- Select Indicators (Amount in ` Crore) Item Jun-2021 Sep-2021 Dec-2021 Mar-2022 Financial Assets (a+b+c+d+e+f+g+h) 2,33,27,377 2,39,99,280 2,47,08,474 2,54,40,650 Per cent of GDP 110.4 108.9 108.2 107.8 (a) Bank Deposits (i+ii) 1,07,90,832 1,09,87,937 1,14,10,330 1,16,80,355 i. Commercial Banks 99,53,044 1,01,48,486 1,05,66,753 1,08,29,079 ii. Co-operative Banks 8,37,788 8,39,451 8,43,577 8,51,276 (b) Non-Bank Deposits of which: Other Financial Institutions 2,06,509 2,06,074 2,03,896 2,09,665 i. Non-Banking Financial Companies 67,840 66,469 66,542 70,564 ii. Housing Finance Companies 1,38,669 1,39,605 1,37,353 1,39,102 (c) Life Insurance Funds 49,29,725 51,42,279 52,13,527 53,57,350 (d) Currency 27,42,897 26,74,266 27,37,059 28,83,904 (e) Mutual funds 18,55,000 20,64,364 21,26,112 21,52,141 (f) Public Provident Fund (PPF) 7,57,398 7,62,264 7,67,287 8,34,148 (g) Pension Funds 6,16,517 6,67,379 6,99,173 7,36,592 (h) Small Savings (excluding PPF) 14,28,499 14,94,717 15,51,089 15,86,496 Financial Liabilities (a+b) 77,43,630 79,38,456 82,69,633 86,22,079 Per cent of GDP 36.6 36.0 36.2 36.5 Loans/Borrowings (a) Banking Sector 61,80,377 63,19,097 65,87,052 68,61,233 of which: i. Commercial Banks 56,47,239 57,87,508 60,52,779 63,89,789 ii. Co-operative Banks 5,31,728 5,30,164 5,32,833 4,69,989 (b) Other Financial Institutions 15,63,253 16,19,358 16,82,581 17,60,847 of which: i. Non-Banking Financial Companies 7,36,312 7,66,463 7,98,641 8,38,643 ii. Housing Finance Companies 7,21,510 7,45,914 7,75,408 8,1 2,845 iii. Insurance Corporations 1,05,431 1,06,981 1,08,532 1,09,359 164 RBI Bulletin February 2025CURRENT STATISTICS No. 50 (b): Stocks of Financial Assets and Liabilities of Households- Select Indicators(Contd.) (Amount in ` Crore) Item Jun-2022 Sep-2022 Dec-2022 Mar-2023 Financial Assets (a+b+c+d+e+f+g+h) 2,56,21,348 2,64,23,992 2,71,87,716 2,78,44,981 Per cent of GDP 102.8 102.6 103.2 103.3 (a) Bank Deposits (i+ii) 1,18,43,527 1,21,43,060 1,23,99,459 1,27,07,326 i. Commercial Banks 1,09,87,692 1,12,88,257 1,15,36,717 1,18,21,685 ii. Co-operative Banks 8,55,835 8,54,803 8,62,742 8,85,641 (b) Non-Bank Deposits of which: Other Financial Institutions 2,16,170 2,18,247 2,26,328 2,28,562 i. Non-Banking Financial Companies 74,794 78,061 81,308 85,254 ii. Housing Finance Companies 1,41,376 1,40,185 1,45,020 1,43,308 (c) Life Insurance Funds 53,25,967 55,59,682 57,86,593 57,95,431 (d) Currency 29,50,343 28,95,764 29,72,524 31,21,514 (e) Mutual funds 20,48,097 22,60,210 23,55,316 23,67,793 (f) Public Provident Fund (PPF) 8,51,913 8,58,591 8,64,731 9,39,449 (g) Pension Funds 7,44,459 7,96,454 8,53,412 8,98,343 (h) Small Savings (excluding PPF) 16,40,871 16,91,985 17,29,353 17,86,563 Financial Liabilities (a+b) 89,11,861 92,46,741 97,00,657 1,02,17,746 Per cent of GDP 35.8 35.9 36.8 37.9 Loans/Borrowings (a) Banking Sector 70,95,468 73,58,918 77,29,701 81,13,546 of which: i. Commercial Banks 66,20,073 68,81,338 72,49,643 75,80,936 ii. Co-operative Banks 4,73,897 4,76,025 4,78,487 5,30,915 (b) Other Financial Institutions 18,16,393 18,87,823 19,70,956 21,04,201 of which: i. Non-Banking Financial Companies 8,69,175 9,05,825 9,61,617 10,56,182 ii. Housing Finance Companies 8,35,181 8,68,213 8,93,116 9,29,862 iii. Insurance Corporations 1,12,037 1,13,785 1,16,223 1,18,157 RBI Bulletin February 2025 165CURRENT STATISTICS No. 50 (b): Stocks of Financial Assets and Liabilities of Households- Select Indicators (Concld.) (Amount in ` Crore) Item Jun-2023 Sep-2023 Dec-2023 Mar-2024 Financial Assets (a+b+c+d+e+f+g+h) 2,87,56,851 2,96,44,299 3,07,47,010 3,19,86,847 Per cent of GDP 104.6 105.4 106.6 108.3 (a) Bank Deposits (i+ii) 1,29,62,575 1,34,68,783 1,37,48,656 1,41,43,228 i. Commercial Banks 1,20,67,764 1,25,74,464 1,28,57,001 1,32,44,314 ii. Co-operative Banks 8,94,811 8,94,319 8,91,655 8,98,914 (b) Non-Bank Deposits of which: Other Financial Institutions 2,28,077 1,20,095 1,25,432 1,27,257 i. Non-Banking Financial Companies 91,373 96,156 1,01,051 1,02,994 ii. Housing Finance Companies 1,36,703 23,939 24,381 24,263 (c) Life Insurance Funds 60,64,437 62,55,801 65,53,726 67,69,272 (d) Currency 30,72,878 30,36,177 30,92,896 32,39,540 (e) Mutual funds 26,26,046 28,29,859 31,56,299 33,87,208 (f) Public Provident Fund (PPF) 9,55,061 9,60,344 9,64,852 10,51,376 (g) Pension Funds 9,70,016 10,17,975 10,91,276 11,72,651 (h) Small Savings (excluding PPF) 18,77,761 19,55,265 20,13,873 20,96,314 Financial Liabilities (a+b) 1,05,39,266 1,10,65,282 1,15,75,799 1,20,96,412 Per cent of GDP 38.3 39.3 40.2 41.0 Loans/Borrowings (a) Banking Sector 83,27,152 91,96,026 95,98,673 99,91,003 of which: i. Commercial Banks 77,88,962 86,64,616 90,54,514 94,37,072 ii. Co-operative Banks 5,36,409 5,29,528 5,42,241 5,51,852 (b) Other Financial Institutions 22,12,114 18,69,256 19,77,126 21,05,409 of which: i. Non-Banking Financial Companies 11,37,631 11,97,315 12,82,347 13,83,183 ii. Housing Finance Companies 9,53,646 5,49,352 5,70,585 5,96,438 iii. Insurance Corporations 1,20,837 1,22,590 1,24,194 1,25,788 Note : 1. Data as ratios to GDP have been calculated based on the Provisional Estimates of National Income 2023-24, released by NSO on May 31, 2024. 2. Pension funds comprises funds with the National Pension Scheme. 3. Outstanding deposits with Small Savings are sourced from the Controller General of Accounts, Government of India. 4. Non-bank deposits apart from other financial institutions, comprises state power utilities, co-operative non credit societies etc. Data for outstanding deposits are available only for other financial institutions. 5. Figures in the columns may not add up to the total due to rounding off. 166 RBI Bulletin February 2025CURRENT STATISTICS Explanatory Notes to the Current Statistics Table No. 1 1.2& 6: Annual data are average of months. 3.5 & 3.7: Relate to ratios of increments over financial year so far. 4.1 to 4.4, 4.8,4.9 &5: Relate to the last friday of the month/financial year. 4.5, 4.6 & 4.7: Relate to five major banks on the last Friday of the month/financial year. 4.10 to 4.12: Relate to the last auction day of the month/financial year. 4.13: Relate to last day of the month/ financial year 7.1&7.2: Relate to Foreign trade in US Dollar. Table No. 2 2.1.2: Include paid-up capital, reserve fund and Long-Term Operations Funds. 2.2.2: Include cash, fixed deposits and short-term securities/bonds, e.g., issued by IIFC (UK). Table No. 4 Maturity-wise position of outstanding forward contracts is available at http://nsdp.rbi.org.in under ‘‘Reserves Template’’. Table No. 5 Special refinance facility to Others, i.e. to the EXIM Bank, is closed since March 31, 2013. Table No. 6 For scheduled banks, March-end data pertain to the last reporting Friday. 2.2: Exclude balances held in IMF Account No.1, RBI employees’ provident fund, pension fund, gratuity and superannuation fund. Table Nos. 7 & 11 3.1 in Table 7 and 2.4 in Table 11: Include foreign currency denominated bonds issued by IIFC (UK). Table No. 8 NM and NM do not include FCNR (B) deposits. 2 3 2.4: Consist of paid-up capital and reserves. 2.5: includes other demand and time liabilities of the banking system. Table No. 9 Financial institutions comprise EXIM Bank, SIDBI, NABARD and NHB. L and L are compiled monthly and L quarterly. 1 2 3 Wherever data are not available, the last available data have been repeated. Table No. 13 Data against column Nos. (1), (2) & (3) are Final and for column Nos. (4) & (5) data are Provisional. RBI Bulletin February 2025 167CURRENT STATISTICS Table No. 14 Data in column Nos. (4) & (8) are Provisional. Table No. 17 2.1.1: Exclude reserve fund maintained by co-operative societies with State Co-operative Banks 2.1.2: Exclude borrowings from RBI, SBI, IDBI, NABARD, notified banks and State Governments. 4: Include borrowings from IDBI and NABARD. Table No. 24 Primary Dealers (PDs) include banks undertaking PD business. Table No. 30 Exclude private placement and offer for sale. 1: Exclude bonus shares. 2: Include cumulative convertible preference shares and equi-preference shares. Table No. 32 Exclude investment in foreign currency denominated bonds issued by IIFC (UK), SDRs transferred by Government of India to RBI and foreign currency received under SAARC and ACU currency swap arrangements. Foreign currency assets in US dollar take into account appreciation/depreciation of non-US currencies (such as Euro, Sterling, Yen and Australian Dollar) held in reserves. Foreign exchange holdings are converted into rupees at rupee-US dollar RBI holding rates. Table No. 34 1.1.1.1.2 & 1.1.1.1.1.4: Estimates. 1.1.1.2: Estimates for latest months. ‘Other capital’ pertains to debt transactions between parent and subsidiaries/branches of FDI enterprises. Data may not tally with the BoP data due to lag in reporting. Table No. 35 1.10: Include items such as subscription to journals, maintenance of investment abroad, student loan repayments and credit card payments. Table No. 36 Increase in indices indicates appreciation of rupee and vice versa. For 6-Currency index, base year 2022-23 is a moving one, which gets updated every year. REER figures are based on Consumer Price Index (combined). The details on methodology used for compilation of NEER/REER indices are available in December 2005, April 2014 and January 2021 issues of the RBI Bulletin. Table No. 37 Based on applications for ECB/Foreign Currency Convertible Bonds (FCCBs) which have been allotted loan registration number during the period. 168 RBI Bulletin February 2025CURRENT STATISTICS Table Nos. 38, 39, 40 & 41 Explanatory notes on these tables are available in December issue of RBI Bulletin, 2012. Table No. 43 Part I-A. Settlement systems 1.1.3: Tri- party Repo under the securities segment has been operationalised from November 05, 2018. Part I-B. Payments systems 4.1.2: ‘Others’ includes e-commerce transactions and digital bill payments through ATMs, etc. 4.2.2: ‘Others’ includes e-commerce transactions, card to card transfers and digital bill payments through ATMs, etc. 5: Available from December 2010. 5.1: includes purchase of goods and services and fund transfer through wallets. 5.2.2: includes usage of PPI Cards for online transactions and other transactions. 6.1: Pertain to three grids – Mumbai, New Delhi and Chennai. 6.2: ‘Others’ comprises of Non-MICR transactions which pertains to clearing houses managed by 21 banks. Part II-A. Other payment channels 1: Mobile Payments – Include transactions done through mobile apps of banks and UPI apps. o The data from July 2017 includes only individual payments and corporate payments initiated, o processed, and authorised using mobile device. Other corporate payments which are not initiated, processed, and authorised using mobile device are excluded. 2: Internet Payments – includes only e-commerce transactions through ‘netbanking’ and any financial transaction using internet banking website of the bank. Part II-B. ATMs 3.3 and 4.2: only relates to transactions using bank issued PPIs. Part III. Payment systems infrastructure 3: Includes ATMs deployed by Scheduled Commercial Banks (SCBs) and White Label ATM Operators (WLAOs). WLAs are included from April 2014 onwards. Table No. 45 (-) represents nil or negligible The table format is revised since monthly Bulletin for the month of June 2023. Central Government Dated Securities include special securities and Sovereign Gold Bonds. State Government Securities include special bonds issued under Ujwal DISCOM Assurance Yojana (UDAY). Bank PDs are clubbed under Commercial Banks. The category ‘Others’ comprises State Governments, DICGC, PSUs, Trusts, Foreign Central Banks, HUF/ Individuals etc. Data since September 2023 includes the impact of the merger of a non-bank with a bank. RBI Bulletin February 2025 169CURRENT STATISTICS Table No. 46 GDP data is based on 2011-12 base. GDP for 2023-24 is from Union Budget 2023-24. Data pertains to all States and Union Territories. 1 & 2: Data are net of repayments of the Central Government (including repayments to the NSSF) and State Governments. 1.3: Represents compensation and assignments by States to local bodies and Panchayati Raj institutions. 2: Data are net of variation in cash balances of the Central and State Governments and includes borrowing receipts of the Central and State Governments. 3A.1.1: Data as per RBI records. 3B.1.1: Borrowings through dated securities. 3B.1.2: Represent net investment in Central and State Governments’ special securities by the National Small Savings Fund (NSSF). This data may vary from previous publications due to adjustments across components with availability of new data. 3B.1.6: Include Ways and Means Advances by the Centre to the State Governments. 3B.1.7: Include Treasury Bills, loans from financial institutions, insurance and pension funds, remittances, cash balance investment account. Table No. 47 SDF is availed by State Governments against the collateral of Consolidated Sinking Fund (CSF), Guarantee Redemption Fund (GRF) & Auction Treasury Bills (ATBs) balances and other investments in government securities. WMA is advance by Reserve Bank of India to State Governments for meeting temporary cash mismatches. OD is advanced to State Governments beyond their WMA limits. Average amount Availed is the total accommodation (SDF/WMA/OD) availed divided by number of days for which accommodation was extended during the month. - : Nil. Table No. 48 CSF and GRF are reserve funds maintained by some State Governments with the Reserve Bank of India. ATBs include Treasury bills of 91 days, 182 days and 364 days invested by State Governments in the primary market. --: Not Applicable (not a member of the scheme). The concepts and methodologies for Current Statistics are available in Comprehensive Guide for Current Statistics of the RBI Monthly Bulletin (https://rbi.org.in/Scripts/PublicationsView.aspx?id=17618) Time series data of ‘Current Statistics’ is available at https://data.rbi.org.in. Detailed explanatory notes are available in the relevant press releases issued by RBI and other publications/releases of the Bank such as Handbook of Statistics on the Indian Economy. 170 RBI Bulletin February 2025RREECCEENNTT PPUUBBLLIICCAATTIIOONNSS Recent Publications of the Reserve Bank of India Name of Publication Price India Abroad 1. 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