Page 24 - Policy_Economic_Report_September2020

Policy and Economic Report:
Oil & Gas Market

port cargo traffic, GST e-way bills, and the consumption of ATF and petrol also fall by differing rates in
August. However, the performance with regard to diesel consumption, thermal and hydroelectricity
generation, non-oil merchandise exports and bank deposits fall in August compared to the previous
month. The report warns that there may be some intermittent setbacks before the economy gets back to
its pre-COVID levels.

Further, the report goes on to suggest that the contraction in the index of industrial production may ease
by 6 – 8 per cent in august after recording a sharp contraction f 10.4 per cent in July. During the first
quarter of FY 20-21, the Indian GDP contracted by as much as 23.9 per cent against a growth of 5.1 per
cent in Q1, 2020. The report shows a strong growth with production of motorcycles recording a 20 month
high of 5.9 per cent growth in August due to sustained rural demand.

Electricity demand improved by 1.2 per cent on year in the first half of September 2020. Due to a
contraction in electricity generation from August-December 2019, the electricity generation sector may
out-perform much of the rest of the economy within the next few months. Such growth in power
generation will support the growth of other sectors. In stark contrast, non-oil merchandise exports fall in
August compared to the previous month as demand is still constrained due to rising Covid-19 infections
in various trading partners of the country.

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September 2020