Current Affairs - Economy

In October 2024, UPI achieved a record high with 16.58 billion transactions worth ₹23.49 lakh crore, reflecting a 45% year-on-year growth. This significant increase underscores UPI's role in driving the shift toward a cashless economy by offering secure, fast, and seamless payment solutions. Operational in 7 countries, UPI, launched by NPCI in 2016, continues to enhance global digital payment adoption.

India’s Core Sector growth rebounded to 3.1% in October 2024, reflecting recovery momentum after a low of 0.1% in August. The eight core industries, contributing 40% of the industrial output, play a significant role in assessing the economic health. This improvement signals gradual stabilization, although growth remains lower compared to the robust performance in the previous fiscal year.

In Q2 FY 2024-25, India’s GDP growth rate slowed to 5.4%, marking the slowest growth in seven quarters. This represents a decrease from 6.7% in the previous quarter (Q1 FY 2024-25) and an 8.1% growth in the same period last year (Q2 FY 2023-24). The decline reflects a broad slowdown across various sectors, including manufacturing, mining, and utilities, despite improvements in services such as public administration and trade. The slowdown is a significant indicator of the challenges faced by the Indian economy in this period.

S&P Global retained India's GDP growth forecast for 2024-25 at 6.8%. Despite revisions for subsequent years, this figure reflects confidence in India's economic stability for the stated period. Factors influencing the forecast include high interest rates and a reduction in fiscal impetus, which may dampen urban demand. However, the retained growth rate suggests resilience in other sectors offsetting these challenges.

In October 2024, India's Consumer Price Index (CPI) or retail inflation surged to 6.2%, marking the highest inflation rate since August 2023. This increase was primarily driven by a rise in food prices, with food inflation reaching a 15-month high. Despite global inflation easing, India continued to experience persistent price pressures, which were exacerbated by factors like extreme weather events, global price volatility, and rising core inflation. The surge in CPI surpassed the Reserve Bank of India's upper tolerance limit of 6%.