IMPACT OF DEMONETIZATION (2016) ON VARIOUS SECTORS OF INDIAN ECONOMY




INDUSTRY SECTOR –
There was an decrease in purchasing managing index (PMI) from 54.4 in October, 2016 to 52.3 in November, 2016 and 49.6 in December, 2016 and 50.4 in January, 2017.


Sectorial Indicators(y-o-y growth %)
INDUSTRY
Apr-Oct, 16
Oct, 16
Nov, 16
Dec, 16
Jan, 17
Feb, 17
PMI
52
54.4
52.3
49.6
50.4
50.7
IIP
-0.3
-1.9
5.7
-0.1
2.7
-
Mining
-0.2
-0.9
3.7
5.5
5.3
-
Coal
0.7
-1.6
6.4
4.4
4.8
-
Crude Oil
-3.3
-3.2
-5.4
-0.8
1.3
-
Natural gas
-0.4
-1.4
-1.7
0
11.9
-
Manufacturing
-1
-2.4
5.5
-1.7
2.3
-
Electricity
4.5
1.1
8.9
6.3
3.9
-
SOURCE: RBI & CSO

The electricity shoot up by 8.9% and 6.3% which was higher than the growth of 4.5% in Apr-Oct, 2016 and decreased to 3.9% in January, 2017. The coal production shoot up by 6.4% in November, 2016 and decreased to 4.8% in January, 2017.The natural gas production also increased to 11.9% in January, 2017 from -1.7% in November, 2016.Also there was an increase in mining production and in crude oil production. The manufacturing shoot up by 5.5% in November, 2016 from -2.4 in October, 2016 and fall to -1.7% in December, 2017.

SERVICE SECTOR –
There was a fall in automobile sales from 8.1% in October, 2016 to -5.5% in November, 2016 and further fall to -18.7% in December, 2016. The three wheelers sales was also fall from 4.4 in October, 2016 to -25.9 in November, 2016 and two wheelers sales falls from 8.7 in October, 2016 to -5.9 in November, 2016.

Sectorial Indicators(y-o-y growth %)
              SERVICES
Apr-Oct 16
Oct 16
Nov 16
Dec 16
Jan 17
Feb 17
PMI services
52.6
54.5
46.7
46.8
48.7
50.3
Automobile sales
15
8.1
-5.5
-18.7
-4.7
0.9
C.V.Sales
6..9
11.9
-11.6
-5.1
-0.7
7.3
P.V.Sales
11
4.5
1.8
-1.4
14.4
9
Three wheelers
11.8
4.4
-25.9
-36.2
-28.2
-21.4
Two wheelers
16
8.7
-5.9
-22
-7.4
0
Cargo handled
6.3
13.2
10.2
12.9
3.6
-
Railway freight traffic
-1.7
-2.6
5.5
-0.1
0.3
-
Tourists arrivals
10.8
10.4
9.2
13.6
16.4
-
Cement production
4.8
6.2
0.5
-8.7
-13.3
-
Steel production
2.7
0.3
5
5.3
3.1
-
Domestic cargo traffic
7.5
10.6
-0.6
7.5
10.1
-
International cargo traffic
9.2
15.6
15.4
12.6
16
-
International passenger traffic
9.1
7.4
7.7
7.7
8.8
-
Domestic passenger traffic
22.5
23.6
22
23.9
25.6
-
Bank deposits
6.4
9.3
15.7
14.9
13.5
-
Insurance premium
31.1
22.4
72.1
21.1
32.1
-
Merchandise exports
0.2
9
2.4
5.5
4.3
-
Merchandise imports
-9.8
8.3
9.4
0.1
10.7
-
 SOURCE: RBI & CSO

The tourists arrival fall in November, 2016 to 9.2 from 10.4 in October, 2016 and further increased to 13.6 in December, 2016. The steel production increased to 5% in November, 2016 from 0.3% in October, 2016 and then increased to 5.3% in December, 2016 and then fall to 3.1% in January, 2017. The cement production falls to 0.5% in November, 2016 from 6.2% in October, 2016. Also there is an shoot up in insurance premium from 22.4% in October, 2016 to 72.1% in Nov, 2016 but further fall to 21.1% in December, 2016 and 32.1% in January, 2017. The bank deposits increased to 15.7% in November, 2016 from 9.3% in October, 2016 and further more to 14.9% in December, 2016 and 13.5 % in January, 2017.

CONSUMER DURABLE SEGMENT –
In consumer durable goods the washing machine growth robust at 113.1% in October, 2016 and drastically 34.4% in November, 2016.
Growth In Consumer Durable Segment
             CATEGORY            
OCTOBER, 2016
NOVEMBER, 2016
            MICROWAVE          
90.7
-51.5
REFRIGERATORS
73.4
-40.3
AIR CONDITIONER
4
-33.8
WASHING MACHINES
113.1
-34.4
FLAT PANEL TV
99.4
-26.6
SOURCE: RBI & CSO
 As represented in table there was robust at microwave in October, 2016 of 90.7% and drastically -51.5 in November, 2016 and similarly the robust of air conditioners was of 4% in October, 2016 which fall to -33.8 in October, 2016.
AGRICULTURE SECTOR –
As per statistics it is found that the Agriculture growth  was -1 in Q3 of 2015-2016 and  2.3 in Q4 of 2015-2016 and falls to 1.8 in 2016-2017 and further increased to 4 in year 2016-2017.
DIGITAL MODES OF PAYMENTS –
CATEGORY
Oct, 16
Nov, 16
Dec, 16
Jan, 17
Feb, 17
NEFT
Volume
16.2
23.3
39
38
34.5

Value
37.6
38.3
40.8
60.2
49.5
CTS
Volume
-1.1
23
58.4
52.7
20.2

Value
2.9
8.6
13
19.3
0.8

SOURCE: RBI
After the demonetization, electronic method of payments were low in the underlying weeks as individuals were occupied in saving/trading old cash. In December, 2016 the digital modes have started increasing drastically.


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