COVID-19India Economic MonitorDecember 2020 Update

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COVID-19 Executive Summary

Source: MoHFW, POSOCO, MOSPI, Ministry of Commerce & Industry, RBI, GST Network, NPCI, NETC, Ministry of Railways, AAI, JNPT, AIOCD, mFMS, Joint Plant Committee, Ministry of Steel, Ministry of Commerce & Industry, SIAM, CMIE, IRDAI, Ministry of Finance, GST Council, Ministry of Rural Development, Analyst reports, BCG analysis

Trends across key economic indicators• Industrial Activity: Daily avg. power consumption witnessed a 4% YoY growth in Nov'20 as compared to a 10% YoY growth in Oct'20; fuel consumption

contracted 4% YoY in Nov'20 after witnessing positive YoY growth in Oct'20; Index of Industrial Production grew vs. last year in Oct'20, for the second month• Trade: In Nov'20, Merchandize trade stayed at last month levels, however, continued negative YoY gap of -9% in exports and -13% in imports; Services trade

slightly declined, widening YoY gap to -6% in exports and -12% in imports in Oct'20• Logistics: FASTag transactions increased 2% vs. previous months in Nov'20, E-way bills grew at 8% YoY in Nov'20 ; JNPT traffic continued to grow in Nov'20 vs.

last year; Air & rail passenger traffic improved in Sep-Oct'20 vs. previous months, however significantly far from pre-COVID levels• Financial Services: Aggregate deposits & bank credit improved vs. previous months; deposit & credit YoY growth improved in the last week of Nov'20; Value of

UPI transactions continued to hit all time high level at INR 3.9 Tn (100+% YoY growth)• Sector-wise Impact: 2W & tractor sales continued to improve vs. last year levels in Nov'20 (2W sales grew 13%, tractor sales grew 48% YoY), Passenger vehicles

& 3W witnessed YoY de-growth of -3% and -41% respectively; Pharma sales continued to grow vs. last year & fertilizer sales declined in Nov'20 after growing YoY in Oct'20; Consumption of steel grew in Nov'20 vs. last year & previous months; Non-life insurance premium grew vs. Nov'19 levels while life insurance premiums witnessed a dip vs. Nov'19 levels

• Macroeconomic Indicators: GST collections continued to grow vs. last year for the 3rd month in Nov'20, crossing the INR 1 Tn mark; MGNREGA work demand & employment dipped in Nov'20 to 40-50% YoY levels after trending at 75%+ than last year levels in previous months

• Sentiment: Consumer sentiment marginally dipped in Nov'20 vs. Oct'20; rural better than urban; Both Manufacturing & Services PMI remained beyond the 50-point mark in Nov'20 (56.3 & 53.7 respectively), however, witnessed a marginal dip vs. Oct'20 highs; Improvement in value of stock market transactions vs. Sep-Oct20 in Nov'20; Mutual funds AUM continued to grow vs. last year levels & previous months in Nov'20

India GDP witnessed 7.5% YoY de-growth in the Jul-Sep 2020 quarter vs. 23.9% contraction in the previous quarter. Private consumption & gross capital formation recovered while govt. consumption dipped vs. previous quarter. Manufacturing recorded a YoY growth of 0.6% in Jul-Sep quarter vs. 39% YoY de-growth in the previous quarter. Nov'20 high frequency data reflects improvement vs. previous months as well as last year across select indicators - GST collections continued to grow vs. last year; Index of Industrial Production (factory output) stood at an 8-month high. GDP projections saw an upward revision at 7-10% YoY contraction for this financial year.

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0

2,000,000

4,000,000

6,000,000

8,000,000

10,000,000

12,000,000

20-Aug

20-Nov

20-Oct

20-Sep

20-Dec

20-Jul

20-Jun

20-May

20-Apr

Total cases

3.5x 2.8x2.3x

1.8x

1.4.x1.2x

1.1x

RecoveredDeaths Active cases

Total cases 106k 5.4M 10M

Active cases 61k 1M 302k

Days Doubling Rate 13 34 282

Recovery Rate 39.6% 80.1% 95.5%

Test Positivity Rate 4.1% 8.5% 6.2%

Fatality Rate 3.1% 1.6% 1.5%

Source: Ministry of Health & Family Welfare (MoHFW); covid19india.org; BCG analysis

7.6M

739k

88

88.8%

7.9%

1.5%

COVID-19 cases in India on a continuous rise in Nov-Dec'20 albeit with a declining active case count and improved recovery rateData as of 20 Dec

1.1M

401k

18

62.8%

8.0%

2.4%

2.9M

690k

29

74.3%

8.7%

1.9%

9M

442k

186

93.6%

6.9%

1.5%

395k

168k

20

54.1%

5.8%

3.3%

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GDP Deep-Dive2

Economic Indicators1

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Indicator Unit Mar Jun Jul Aug Sep Oct Nov

Industrial Activity

Power Consumption MU -10% -10% -3% -2% 3% 10% 4%

Petroleum Consumption MT -18% -8% -12% -16% -4% 3% -4%

Index of Industrial Prod. Index -18% -17% -10% -8% 0.5% 3.6% NA

Trade

Services Export USD 1% -8% -11% -10% -1% -6% NA

Services Import USD -2% -15% -22% -20% -9% -12% NA

Merchandize Export USD -35% -12% -10% -13% 6% -5% -9%

Merchandize Import USD -29% -48% -28% -26% -20% -12% -13%

Logistics

E-Way Bills Generated Mn -26% 18% -7% -4% 9% 21% 8%

Railway Freight Originated MT -14% -8% -5% 4% 16% 15% NA

JNPT Container Traffic TEUs -13% -29% -20% -19% -5% 5% 8%

Air Freight kT -32% -40% -34% -30% -16% -14% -13%

Air Passenger Traffic Mn -38% -85% -84% -79% -70% -62% -57%

Rail Passengers Booked Mn -39% -100% -98% -97% -94% -91% NA

Financial Services

NPCI Retail Txns. (Values) INR -4% -2% -4% 0% 11% 7% NA

NPCI Retail Txns.( Volume) Mn 24% 39% 37% 40% 49% 41% NA

Total Bank Credit INR 6.1% 6.2% 5.9% 5.5% 5.2% 5.4% 5.7%

Total Bank Deposits INR 8.5% 11.1% 11.0% 11.0% 11.3% 10.3% 10.7%

Indicator Unit Mar Jun Jul Aug Sep Oct Nov

Sector-wise ImpactCement Production MT -25% -7% -14% -15% -4% 3% NASteel Consumption MT -23% -29% -9% -8% -1% 1% 23%Passenger Vehicle Sales k -56% -51% -14% -2% 13% 9% -3%Tractor Sales k -50% 20% 36% 65% 27% 9% 48%Two-wheeler Sales k -36% -38% -20% 0.2% 11% 18% 13%Fertilizer Sales MT 18% 79% 34% -9% -11% 9% -10%Gross Premium (Life) INR -32% -10% 7% 15% 26% 32% -27%Gross Premium (Non-Life) INR -11% 8% 18% 10% -4% -0.4% 3%Pharma. Sales INR 9% 2% 0.2% -2% 4% 10% 1%Chemical Production Index Index -2% -26% -13% -4% -2% NA NAMacroeconomic IndicatorsTotal GST Collection INR -8% -9% -15% -12% 4% 10% 1%Central Govt. Expenditure INR Tn 2.2 3.0 2.4 1.9 2.3 1.8 NAMGNREGA Jobs Demand HHs 2% 74% 74% 67% 71% 89% 50%MGNREGA Jobs Provided HHs -1% 80% 83% 63% 65% 83% 44%No. of Tenders Announced k -4% 29% 125% 80% 110% 201% 127%FDI Inflow USD Bn 4.9 -0.1 4.0 18.4 3.3 NA NAFII USD Bn -15.0 3.1 0.6 6.7 -0.3 NA NASentimentIndia VIX Index 64.4 29.1 24.7 22.8 19.5 24.8 19.8PMI (Manufacturing) Index 51.8 47.2 46.0 52.0 56.8 58.9 56.3PMI (Services) Index 49.3 33.7 34.2 41.8 49.8 54.1 53.7

Data for 2020; YoY growth represented for all indicators (except for India VIX, PMI, Central govt. expenditure, FDI, and FII where absolute values are represented)

1

2

3

4

5

6

7

Source: POSOCO, PPAC, MoSPI, RBI, Ministry of Comm. & Industry, GST Network, Ministry of Railways, JNPT, AAI, NPCI, JPC, Ministry of Steel, SIAM, CMIE, mFMS, IRDAI, AIOCD, American Chemistry Council, GST Council, Ministry of Finance, Controller General of Accounts, Ministry of Rural Development, Projects Today, Bloomberg, NSE, BSE, IHS Markit, BCG analysis

Summary: Nov'20 trends continued to show improvement across most indicators, with select indicators exceeding last year levels

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Daily Average Power Consumption Volume ('000s MUs)

IIP1 (Index of Industrial Production) & ICI2 (Index of Core Industries)3

2

0

3

1

4 3.6

3.3

Mar

-20

3.73.8

3.2 2.8

Apr-2

0

3.7

3.9

May

-20

4.03.7

3.6

Jun-

203.8

Jul-2

0

3.6

Aug-

20

3.8

3.2

Sep-

203.6 3.3

Oct

-20

3.2

Nov

-20

20202019

-19% -8%

10

0

5

20

1515.9

17.8

Mar

-20

Apr-2

0

May

-20

Jun-

20

Jul-2

0

Aug-

20

Sep-

20

Oct

-20

Nov

-20

9.4

15.4 16.1 15.6 14.4 15.517.8

-49%-18%

Consumption of Petroleum Products (in MMT)4

-12%

Power consumption improved while fuel consumption dipped vs. Nov'19; IIP witnessed YoY growth in Oct'20, reaching an 8-month high

INDUSTRIAL ACTIVITY

1

1. Index of Industrial Production (IIP) shows the growth rates in different industry groups (comprises of Mfg. (78% weightage), Mining (14%), Electricity (8%))2. Index of Core Industries (ICI) measures performance of production in 8 core industries (Coal, Crude, NG, Refinery Products, Fertilizers, Steel, Cement & Electricity)3. In view of the effect of the containment measures for COVID-19 pandemic, the indices for Apr-20 & May-20 are not comparable with preceding months4. Petroleum products include LPG, Naphtha, MS, ATF, SKO, HSD, LDO, Lubricants & Greases, FO & LSHS, Bitumen, coke as reported (provisional) by Petroleum Planning & Analysis CellSource: Power System Operation Corporation, Ministry of Statistics & Programme Implementation, Dept. for Promotion of Industry & Internal Trade, PPAC, BCG analysis

-16%YoYgrowth -4%3%-10% -2%-10% -16%-25% -3% 3% 10% -4%4%

5490

108118 117

124 129

134

81

108116

123 119 121 124

0

50

100

150

Mar

-20

Apr-2

0

May

-20

Jun-

20

Jul-2

0

Aug-

20

Oct

-20

Sep-

20

117

-10%-57% -17%-33% -8%

IIP ICIIIPYoY growth

0.5%-18% 3.6%

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Merchandize trade stayed at Oct'20 levels, however, continued negative gap with last year; Services trade slightly declined, widening YoY gap

MERCHANDIZE & SERVICES TRADE

2

29.5

Jun-20

22.227.7

May-20 Aug-20Feb-20

28.5

Apr-20Mar-20

22.7

31.2

Jul-20 Sep-20 Oct-20

37.5

24.921.4

10.3

17.119.1 21.9 21.1

23.6 27.630.3

Nov-201

33.6

23.5

33.4

Merchandize Exports Merchandize Imports

1. November 2020 Merchandize Import & Export numbers, October Service Import & Export numbers are provisional as provided by the Ministry of Commerce and Industry on 15th Dec'20Source: RBI, Ministry of Commerce & Industry, BCG analysis

Merchandize Trade (USD Bn) Services Trade (USD Bn)

3% -35% -60% -36% -12%ExportsYoY growth

-10%

2% -29% -60% -52% -48%ImportsYoY growth

-28%

-13%

-26%

10.1

Jun-20

17.316.8

Jul-20Feb-20 Mar-20 Apr-20 May-20 Aug-20 Sep-20

17.7

9.611.1

18.216.4

11.1

16.5

9.3 9.9

17.0

10.0

17.0

10.0

16.6

Oct-20

9.5

Services Exports Services Imports

7% 1% -9% -8%-10%

13% -2% -18% -15%-20%

-11%

-22%-20%

6% -10%

-20%

-1%

-9%

-5%

-12%

-6%

-12%

-9%

-13%

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.8555

82 8797

0

30

60

120

90

150

10

Oct

-20

Jul-2

0

Mar

-20

Apr-2

0

May

-20

Jun-

20

Aug-

20

110

Sep-

20

122

Nov

-20

125

+2%70

50

0

40

10

20

30

60

43.4

Nov

-20

Mar

-20

Apr-2

0

25.5

May

-20

Jul-2

0

Jun-

20

Aug-

20

Sep-

20

Oct

-20

40.7

8.6

48.4 49.4

57.464.1

55.3

-14%

-26% -84% 18% -23% -88% 437% 48%MoMgrowth

YoYgrowth -53%

Toll collection suspended

from 25-Mar to 20-Apr2

6%-7%

E-way bill & FASTag transaction volumes grew YoY in Nov'20;Rail freight continued to grow YoY in Oct'20

3

1. E-Way bills are required to be generated at the time of transport of goods by every registered person if the value of the consignment exceeds INR 50,000; 2. As per announcement by NHAI; 3. High YoY growth due to drop in e-way bills in Jun-19; due to new provision introduced limiting generation of E-Way bills if the GST Return filing pending for last 2 monthsSource: GST Network, NHAI, NPCI, Ministry of Railways, CEIC data, BCG analysis

E-way bills1 generated(Mn)

FASTag transaction volume (Mn)

Railway freight traffic originating (Mn Tons)

12%-4% 9% 14%

0

30

90

60

120

May

-20

82.665.4

Jul-2

0

103.1

Mar

-20

Apr-2

0

93.6

Jun-

20

95.2

Oct

-20

94.6

Aug-

20

102.3108.3

Sep-

20

+6%

-14% -35% -21% -8%YoYgrowth

-5% 4%21% 11% 16%

LOGISTICS

8% 15%2%

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.

400

0

350

300

50

100

250

150

450

200

Oct

-20

Nov

-20

414417

284

Feb-

20

Apr-2

0

275

May

-20

289

Jun-

20

344

Jul-2

0

353Au

g-20

380

Sep-

20

410

Mar

-20

423

-1%

164 162133

4076

107 123 128144 148 142

112 106

77

5669 76

95 111 101

6090

0

150

30

120

180

270

210

300

240239

Jan-

20

Feb-

20

Mar

-20

268

Sep-

20

Apr-2

0

192

19

May

-20

Jul-2

0

Oct

-20

Aug-

20

Jun-

20

244

95

276

210

7

163

204

259

Nov

-20

47

-12%

-37% -39% -29% -1% -32% -83% -68%-1%YoYgrowth

YoYgrowth

Domestic International

1% -13% -20% -40% -34%

JNPT traffic grew vs. Nov'19 levels; Air Freight YoY gap improved in Nov'20 vs. Apr-Oct'20 levels, though below last year levels

LOGISTICS

3

JNPT Container Traffic ('000s TEUs1) Air Freight (k Tons)

1. TEU refers to Twenty-foot equivalent unit equivalent to 20 shipping containers (20 feet long, 8 feet tall)Source: Jawaharlal Nehru Port Trust, Airport Authority of India, BCG analysis

-19% -5% -30%5% -16% -14%8% -13%

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YoYgrowth

Air & rail passenger traffic saw improvement vs. Apr-Sep'20 levels, though significantly below last year levels

LOGISTICS

3

Source: Ministry of Railways, CEIC data, Airport Authority of India, BCG analysis

6 5

25 24

15

6 810 13

0

30

60

1 1

Mar

-20

Jan-

20

4

11

Feb-

20

3

29

00

Apr-2

0

0

May

-20

Jul-2

0

0

Jun-

20

41 1Au

g-20

Sep-

201

Oct

-20

31

18

0 1 45 6

8

Nov

-20

1

14

Domestic International

Air Passengers (Mn)

1% -38% -100% -98%7% -85% -84% -79%

715676

436

-8 -4

4 15 22 3962

-100

400

300

0

100

200

500

600

800

700

Oct

-20

Jan-

20

Jun-

20

Feb-

20

Mar

-20

Apr-2

0

May

-20

Jul-2

0

Aug-

20

Sep-

20

Railway Passenger Bookings (Mn)

-101% -101% -100% -98% -97% -94%-39%5%-2%

Negative volume represents net higher refunds as compared to

new bookings in that month

-70% -91%-62% -57%

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10.6 10.611.3 11.0 11.1 10.8 11.1 11.0 10.9

12.0

10.5 10.5 10.1 10.610.9

5

0

10

140

145

15

0

135

150

03-Ju

l

14-A

ug

08-M

ay

06-N

ov

22-M

ay

139.

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-Jun

138.

66

138.

49

140.

76

140.

19

31-Ju

l

17-Ju

l

140.

79

141.

7528

-Aug

142.

4811

-Sep

09-O

ct14

3.02

142.

9223

-Oct

20-N

ov

141.

60

138.

29

143.

81

19-Ju

n

25-S

ep14

2.62

143.

71

YoY growth Aggregate bank deposits

6.5 6.3 6.2 6.2 6.3 5.8 5.7 5.5 5.5 5.3 5.2 5.7 5.15.7 5.8

0

15

102

0

5

10

08-M

ay10

2.52

102.

2322

-May

25-S

ep

102.

5505

-Jun

104.

05

102.

4619

-Jun

03-Ju

l

23-O

ct

09-O

ct

102.

19

31-Ju

l

102.

20

104.

35

103.

39

102.

28

28-A

ug

17-Ju

l

11-S

ep

102.

72

14-A

ug

102.

16

103.

04

06-N

ov

20-N

ov

102.

82 103

.44

YoY growth Aggregate bank credit

Bank credit (INR Tn)

Aggregate deposits & bank credit improved vs. previous months; deposit & credit YoY growth improved in the last week of Nov'20

FINANCIAL SERVICES

4

Total deposits value & YoY growth aggregated for all banks

Total credit outstanding value & YoY growth aggregated for all banks

Source: RBI DBIE, Press search, BCG analysis

YoY growth (%)Bank deposits (INR Tn) YoY growth (%)

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Oct'20 retail transactions observed strong growth vs. previous months & last year; Stronger YoY growth in volume as compared to value

4

Volume of retail transactions4 (in Bn) Value of retail transactions4 (in INR Tn)

9%

Nov

’19

12.4

43%

57%

39%

10% 10%

46%

43%

47%

13.6

Oct

’19

10%

34%

Feb’

20

47%

43% 48%

Aug’

20

10%10% 9%

47% 43%

43%

9%

65%

Jan’

20

9%

13.2

52%

Mar

’20

10%10%24%

Apr’2

0

11%27%

62%

13.5

May

’20

12.6

56%

Jun’

20

9%

34%34%

Dec

’19

9.6

Oct

’20

34%

15.5

57%

36%

55%

Jul’2

0

56%

14.2 14.113.2

6.7

11.9

15.2

Sep’

20

Cash1 Physical2 Digital3 (incl. UPI)

20% 19% 17% 19% 35% -4% -50% -29% -2%

81%

14%16% 12%4%

13%

80%

Nov

’19

Oct

’19

90%

4%15%

82%

15%3%

2.6

12%

Dec

’19

Aug’

20

3%3% 2%

82%

2.5

Jan’

20

88%

14%

84%82%

Feb’

20

3%

Mar

’20

88%

9%

3.0

1%

2.0

2%

Apr’2

0

1%

2.9

87%M

ay’2

0

2%Ju

n’20

11%

87%

Jul’2

0

86%

2%10%

88%

2%

Sep’

20

10%

Oct

’20

10%

2.42.62.7

2.42.2

2.5

3.4

2.4

61% 56% 53% 59% 56% 24% 7% 22% 39%

1. Cash refers to NFS Inter Bank ATM Cash Withdrawal; 2. Physical refer to CTS Cheque Clearing (Processed Volume); 3. Digital refer to NACH- National Automated Clearing House, IMPS, RuPay Card usage at (POS), RuPay Card usage at (eCom) AEPS (Inter Bank) Txn over Micro ATM (e.g., Cash withdrawal/Cash Deposit), BBPS (Bill Payment passing through BBPCU), UPI—Unified Payments Interface, USSD 1.0, NETC 4. NPCI retail transactions does not include NEFT, RTGS through RBI, Credit and debit card transactions other than RuPay, mobile banking & internet banking transaction, cash withdrawal from bank's ATMSource: BCG Analysis, National Payment Corporation of India (NPCI)

YoY growth

37% 0%40% -4%

FINANCIAL SERVICES

49% 11%41% 7%

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Value of UPI transactions in Nov'20 continued to spike by 100+% vs. previous year's levels, hitting a new milestone

4

Source: NPCI

0.9

4.5

0.0

3.6

1.8

2.7

Oct-20Nov-19 Dec-19 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20

2.98

1.89

Jan-20

3.29

Value of transactions in INR Tn

2.062.03 2.16

Nov-20

2.23

2.91

1.51

2.18

2.62

3.86 3.91

+107%

+1%

1.251.331.311.311.22 1.00 1.501.23 1.34

YoY%

Volume of Txn in Bn.

1.61

FINANCIAL SERVICES

1.80 2.07 2.21

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Consumption of steel grew in Nov'20 vs. last year & previous months; Cement production grew vs. Oct'20 and Mar-Sep'20 levels

5SECTOR-WISE IMPACT

YoY growth

-90% -15%

4.1

0.4 2.0

3.5 4.04.5 4.7 4.5

5.2

0

2

4

6

Mar

-20

Apr-2

0

Aug-

20

May

-20

Sep-

20

Jun-

20

Jul-2

0

Oct

-20

Nov

-20

-5%

Long Steel Consumption

Consumption of Long Steel (in MMT)

-83% -43%

3.2

0.6

2.1 2.53.8 4.0 3.8

4.4 4.4

0

2

4

6

Mar

-20

Sep-

20

Jul-2

0

Jun-

20

Apr-2

0

May

-20

Aug-

20

Oct

-20

Nov

-20

-38%

Flat Steel Consumption

Consumption of Flat Steel (in MMT)

-56% -51%-12% -6%

Source: Joint Plant Committee, Ministry of Commerce and Industry, Livemint, CMIE, BCG Analysis

-5%-10% -7%6%

Cement Production (in MT)

0

10

20

30

20.924.8 22.4

Mar

-20

Jun-

20

26.4

4.3

Apr-2

0

May

-20

24.2

Jul-2

0

Aug-

20

24.2

Sep-

20

26.9

Oct

-20

Cement Production

-85% -7%-25% -21% -14% -15% -4%4%-3% 3%12%34%

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2W & tractor sales continued to improve vs. last year levels;Passenger vehicle & 3W sales witnessed a dip in Nov'20 vs. last year

5SECTOR-WISE IMPACT

Figures represent wholesale numbers.1. Tata Motors data is available for Apr-June only, BMW, Mercedes and Volvo Auto data is not available Source: SIAM, CMIE, Press search, BCG analysis

Passenger vehicles sales ('000 units) Two-wheeler sales ('000 units)

Tractor sales ('000 units) Three-wheeler sales ('000 units)

61 70 61

190 189 215 272 253 183 216272 310 265

Aug-1938

Jul-19

351

35

Nov-19

50

Sep-19

58

303

Oct-19 Jul-2038

Aug-2039

Oct-20Sep-2041

311

Nov-201

251 259 276322 311

218 254

1,512 1,514 1,657 1,757 1,411 1,281 1,5601,850 2,054 1,600

295

Aug-19 Sep-20

298

2,425

307

Oct-19Jul-19 Nov-20

303

1,462

Sep-19

299

Nov-19181

Jul-20

256

Aug-20

331 371

Oct-20

327

1,818 1,812 1,960 2,052 1,710 1,8162,181 1,928

40 46 45 45 4820

40 43 43 37

56 5966 67 56

19 26 24

Nov-19

33

Oct-19Aug-19Jul-19

54

Sep-19

1513

Jul-20 Aug-20 Oct-20Sep-20 Nov-20

96 105111 112 104

61 69 61

Domestic sales 2019 Exports 2019 Domestic sales 2020 Exports 2020

YoY growth YoY growth

-66%YoY growth -48% -45%

-14% -2% 13% 9% -20% 0.2% 11% 18%

-39%

-3% 13%

-41%

467

Nov-19Jul-19

85115

6377

114

Sep-19

107

7

90

Oct-19

54

6

60109

Aug-198

92

7

Jul-20 Oct-20

65

8

Aug-20

124

8

Sep-20

9

82

Nov-20

52 4471 73

116

63

YoY growth 36% 65% 27% 9% 48%

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Pharma sales continued to grow vs. last year while fertilizer sales witnessed a contraction vs. last year levels in Nov'20

5SECTOR-WISE IMPACT

1. Indian Chemical Production Index refers to a 3-month moving average figure for chemicals production with figure for 2012 as base figure (100)Source: AIOCD, American Chemistry Council, Mobile Based Fertilizer Management System (mFMS), Ministry of Finance, PIB, The Economic Times, Press search, BCG analysis

Pharmaceutical Sales (INR k Cr)

Fertilizer Sales (in LMT)

-16% -27%

121 115

9885 87

102111 115

Aug-

20

May

-20

Sep-

20

Feb-

20

Apr-2

0

Mar

-20

Jun-

20

Jul-2

0

3% -2%

Indian Chemical Production Index1 (3mo. moving avg.)

-26% -13% -5% -2%YoY growth

Mar

-20

Sep-

20

Apr-2

0

10.3

May

-20

Aug-

20

Jul-2

0

Jun-

20

Oct

-20

Nov

-20

13.211.8

10.211.2

12.1 12.213.5 12.8

10%-9% 2%9% -11% 0.2% -2% 4% 1% 45% 98%18% 79% 34%

Aug-

20

40

May

-20

69

47

Jul-2

0

29

Mar

-20

Apr-2

0

Jun-

20

Sep-

20

Oct

-20

66

Nov

-20

69

21

92

49

-9% -11% 9% -10%

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19%

Non-life insurance premium observed an uptick while life insurance premium noticeably declined vs. last year levels in Nov'20

5

Life Insurance premium observed 27% decline in Nov'20 Non-Life1 Insurance premium grew 3% YoY in Nov'20

14,37015,965

24,122

15,92214,586

17,011 17,623

23,057

15,85514,981

Jul-20Sep-19Jul-19 Aug-19 Oct-19 Aug-20 Sep-20 Oct-20Nov-19 Nov-20

+3%

1. Non-Life Insurance includes Fire, Marine, Motor, Engineering, Health, Cop Insurance, Credit Guarantee, Aviation, Personnel accident and Miscellaneous Source: IRDAI, BCG Analysis

21,50923,555

20,05717,272

26,22122,986

27,04025,366

22,776

19,159

Jul-20Jul-19 Aug-19 Nov-20Sep-19 Oct-19 Sep-20Nov-19 Aug-20 Oct-20

-27%

Number of policies

(‘000)

YoY growth rate for no. of policies

Premium (INR Cr.)

2193 1808

-18%

SECTOR-WISE IMPACT

Premium (INR Cr.)

2330 1881

-19%

2343 2291

-2%

2237 2087

-7%

4018 2111

-47%

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Central Govt.'s revenue & expenditure increased YoY in Oct'20;GST collections continued to grow vs. last year in Nov'20

Central Govt. Revenue & Expenditure (INR Tn)(based on data from Controller General of Accounts, Ministry of Finance)

Total GST Collections3 (INR Tn)(based on data from GST Council)

-72% -38% -9%-8%

ExpenditureYoY growth

1. Bloomberg Quint 2. Gross Fiscal Deficit is the difference between the total Non-Debt Receipts of the government (revenue receipts and non-debt capital receipts) and Total expenditure 3. GST Collections include all components: CGST, SGST, IGST, CessSource: Ministry of Finance, GST Council, BCG analysis

0

10

12

0

1

34

-2

3

6

2

5

7

-1

89

0.3

Oct-20

Gross Fiscal D

eficit (INR

Tn)

3.02.0

3.1

-1.0

Mar-20

0.2

0.4

1.4

2.8

May-20Apr-20

1.1

2.01.9

Jun-20

1.6

1.8

0.5

Aug-20

2.3

Sep-20

1.9

Expe

nditu

re &

Rec

eipt

s (IN

R T

n)

Jul-20

1.9

3.22.4

0.81.4

0.4

2.2

Total Expenditure Non-Debt Receipts Gross Fiscal Deficit2

0.4

0.7

0.0

0.2

0.1

0.5

0.3

0.6

0.8

1.0

0.9

1.1

May-20Apr-20 Aug-20

0.91

Oct-20

Tota

l GST

Col

lect

ions

(IN

R T

n)

Mar-20 Jun-20

0.98

Jul-20 Sep-20 Nov-20

0.32

0.62

0.87 0.86

0.95

1.05 1.05

RevenueYoY growth

-15%

80% 21% -21%

-2% -72% -64%

46%

-24%

6%

-28%

6MACROECONOMIC INDICATORS

-12%YoY growth

4%

-35%

-15%

10%

-13%

-26%

1%

47%

9%

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Count & value of tenders announced by Central & State Govts. continued to grow in Nov'20 vs. last year levels

Oct

-19

Aug-

20

Nov

-19

Dec

-19

May

-20

Apr-2

0

Jan-

20

Feb-

20

Mar

-20

Jun-

20

2.1Ju

l-20

Sep-

20

Oct

-20

Nov

-20

1.21.6

1.2

2.8 2.51.8

0.8

1.7

3.32.7 2.9

3.6 3.6

Source: Project Today database, BCG analysis

Count of tenders announced by central &state govts (k)

Value of tenders announced by central & state govts (INR Tn)

0.44

May

-20

Oct

-19

Apr-2

0

Mar

-20

Nov

-19

Jan-

20

Dec

-19

0.74

Feb-

20

0.57

Jun-

20

Jul-2

0

Aug-

20

Sep-

20

Oct

-20

Nov

-20

0.60

0.31

0.470.58

0.650.55

0.480.46

0.600.50

0.58

6

YoYgrowth

17%-10% 7%-4%-5% 29% YoYgrowth

54%-53% 244%-42% 123%125% 55%-49% -20%80%

MACROECONOMIC INDICATORS

110% 43%201% 88%127% 28%

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MGNREGA work demand & employment dipped in Nov'20 to 40-50% YoY levels after trending at 75%+ than last year levels in previous months

6

0

30

10

20

40

19

Sep-20

20 20

Jan-20

16

Feb-20

1816

Mar-20

11

Apr-20

33

May-20

39

Jun-20

28

Jul-20

20

Aug-20 Oct-20 Nov-20

80%YoYGrowth -13% 56%-35%-1%5%

Work Demand (households, in Mn)

Employment Provided (households, in Mn)

0

3020

40

10

50

19

Mar-20 Sep-20Jan-20

2422

Feb-20

21 13

Jun-20Apr-20

37

May-20

23

4532 24

Jul-20 Aug-20

24

Oct-20 Nov-20

74%YoYGrowth -11% 49%-37%2%5% 74%

83%

MGNREGA refers to Mahatma Gandhi National Rural Employment Guarantee ActSource: Ministry of Labor & Employment, Ministry of Rural Development, The Indian Express, Outlook India, LiveMint, BCG analysis

63%

67%

MACROECONOMIC INDICATORS

65%

71% 89%

83%

50%

44%

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Organized sector hiring and joining activity improved in Jul-Sep'20 (based on select indicators)

6

1. Jan-20 level considered as pre-COVID-19 level 2. Active members refers to total contributing members during last one year as published on EPFO dashboard as on 21-Sep-20; 3. Covers every establishment in which 20+ people are employed and certain organizations are covered, subject to certain conditions and exemptions even if they employ less than 20 persons each 4. Net EPF additions are revised monthly as per the EPFO dataSource: Ministry of Labor and Employment, InfoEdge, Naukri.com, BCG analysis

Naukri Jobspeak Index remained stable in Nov'20

Net New EPF Subscriber Trend

Net new EPF subscribers are net of the members newly enrolled, exited and rejoined during the month as per records of the EPFO

Employees in an establishment3 drawing less than INR 15,000 per month are mandated to become members of the EPF upon joining

Net new EPF subscribers improved to ~1.5 Mn in Sep'20 –higher than Mar-Aug'20 levels, as well as last year

Naukri Jobspeak Index

Monthly index which calculates and records hiring activity based on newly added job listings on Naukri.com every month

Jobs analyzed for the monthly index are qualified on the basis of white-collar jobs belonging to the organized corporate sector

100 101

82

40 3851 53

5974 74 73

0

50

100

150

Jul-20Jan-20 Mar-20Nov-19 May-20 Sep-20 Nov-20

Naukri Jobspeak Index

100

Jan-201 number taken as base for index (100)

Net new EPF Subscriber (in Mn)

-0.10 -0.15

-0.5

0.0

0.5

1.0

1.5

0.83

Feb’20

0.641.021.00

0.79 0.81

Jan’20

0.620.57

Mar’20

0.50

Apr’20

0.31

May’20

0.690.31

0.66

Jun’20 Jul’20

0.540.88

Aug’20

1.49

Sep’20

2019

2020

MACROECONOMIC INDICATORS

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WPI reached a 9-month high in Nov'20; CPI eased in Nov'20, however still beyond RBI's upper margin of 6%

6

1. The Consumer Price Index (CPI) is a measure that examines the weighted average of prices of a basket of consumer goods and services, such as transportation, food, and medical care. It is calculated as year on year increase in prices of the commodities 2. The wholesale price index (WPI) measures and tracks the changes in the price of goods in the stages before the retail level –that is, goods that are sold in bulk and traded between entities or businesses instead of consumers. It is calculated as year on year increase in prices of the commoditiesNote: In May 2016, the Reserve Bank of India (RBI) Act, 1934 was amended to provide a statutory basis for the implementation of the flexible inflation targeting framework. Source: BCG Analysis. DPIIT, MOSPI, Office of the Economic Advisor - Department for Promotion of Industry and Internal Trade,CMIE

Monthly inflation rate (in %)

4.53.5

2.8

2.9

3.1

3.2

2.82.0

1.2 1.20.3 0.0

2.83.5

2.3

0.2

1.3 1.5 1.6

10

5

-5

0

0.4

Aug-

20

Jun-

19

Feb-

20

Dec

-18

Jul-2

0

Nov

-18

Jan-

19Fe

b-19

Mar

-19

Mar

-20

Apr-1

9M

ay-1

9

Jul-1

9Au

g-19

-1.8

Sep-

19O

ct-1

9

0.6

Nov

-19

Dec

-19

Oct

-20

Jan-

20

-1.6Ap

r-20

-3.4

-0.6

May

-20

Jun-

20

Sep-

20

Nov

-20

Wholesale Price Index (WPI)2 Consumer Price Index (CPI)1

2.32.0

2.62.9

3.0

3.0

3.2

3.1

4.0

7.47.6

7.2

6.3

6.26.7 6.7

7.37.6

6.9

4

6

0

2

8

Dec

-18

Jul-1

9

Nov

-18

2.1

Jan-

20

5.8

Jan-

19Fe

b-19

Mar

-19

Apr-2

0

Oct

-19

Apr-1

9

Jun-

20

May

-19

Jun-

19

3.3

Aug-

19Se

p-19

4.6

5.5

Nov

-19

Dec

-19

6.6

Aug-

20

Feb-

20M

ar-2

0

May

-20

Jul-2

0

Sep-

20O

ct-2

0N

ov-2

0

MACROECONOMIC INDICATORS

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Nov'20 repo & reverse repo rate remained at the same level; base rate & MCLR on bank borrowings marginally dipped vs. previous months

1. MCLR: Minimum interest rate at which scheduled commercial banks can lend to customers (based on incremental cost of funds). Marginal Cost of Funds based Lending Rate was introduced from April 2016 for fixing interest rates, and replaced the former Base rate methodology (based on average cost of funds). 2. Base Rate: Minimum rate set by the Reserve Bank of India below which banks are not allowed to lend to its customers 3. Repo Rate: Interest rate at which the RBI lends short term funds to licensed commercial banks 4. Reverse Repo Rate: Interest rate which the RBI borrows money from commercial banksSource: CMIE, RBI DBIE

Reserve bank’s policy rates (%) MCLR1 of scheduled commercial banks (Median rate on one-year borrowings, in %)

8.31 8.30

4.00 4.00

3.353

6

9

12M

ar-2

0

Nov

-19

Jan-

20

May

-20

Feb-

20

Jul-2

0

Sep-

20

Apr-2

0

Nov

-20

Oct

-20

Dec

-19

Jun-

20

Aug-

20

Policy rate %

3.35

Base rate 2 Repo rate3 Reverse Repo rate4

7.327.32

8.62

6.10

3

6

9

12

Mar

-20

Nov

-19

Feb-

20

May

-20

Aug-

20

Jan-

20

Jul-2

0

Sep-

20

Nov

-20

Dec

-19

Apr-2

0

Jun-

20

Oct

-20

MCLR (%)

Total

Foreign BanksPublic Sector Banks

Private Sector Banks

6MACROECONOMIC INDICATORS

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INR remained rangebound between ~73/dollar & ~74/dollar;Forex reserves reached their new peak at ~575 USD Bn in Nov'20

Source: CMIE, RBI

538 535 538 541 542 542 545 542 546 552555 561 561 568 573

575 575

0

100

200

300

400

500

600

11-S

ep-2

0

4-Se

p-20

Forex reserves (USD Billion)

28-A

ug-2

0

21-A

ug-2

0

14-A

ug-2

0

7-Au

g-20

18-S

ep-2

0

25-S

ep-2

0

6-N

ov-2

0

2-O

ct-2

0

9-O

ct-2

0

16-O

ct-2

0

23-O

ct-2

0

30-O

ct-2

0

13-N

ov-2

0

20-N

ov-2

0

27-N

ov-2

0

73.51

70

75

80

20-S

ep-2

0

13-S

ep-2

0

29-N

ov-2

0

30-A

ug-2

0

6-Se

p-20

27-S

ep-2

0

4-O

ct-2

0

25-O

ct-2

0

11-O

ct-2

0

18-O

ct-2

0

1-N

ov-2

0

8-N

ov-2

0

15-N

ov-2

0

22-N

ov-2

0

Exchange Rate (INR/USD)

Exchange Rate (INR/USD) Forex reserves (USD Billion)

6MACROECONOMIC INDICATORS

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India witnessed significant FDI in Jan-Sep'20

2.3 3.1 3.25.5 4.6

3.0 2.8 2.54.7 4.5

1.64.2 4.0 2.5 3.2

5.5 4.17.6

4.72.8 3.0 4.1 3.7

5.5 6.2 4.0 4.9 3.3

-1.4 -0.1

4.0

18.4

3.3

Jan-

18

Mar

-18

Feb-

18

Jun-

19

Jun-

18

May

-19

Apr-1

8

Jan-

19

May

-18

Jul-1

8

Nov

-19

Aug-

18

Sep-

18

Oct

-18

Nov

-18

Dec

-18

Feb-

20

Aug-

20

Mar

-19

Oct

-19

Apr-1

9

Jul-1

9

Aug-

19

Sep-

19

Dec

-19

Jan-

20

Mar

-20

Apr-2

0

May

-20

Jun-

20

Jul-2

0

Sep-

202

Feb-

19

Foreign Direct Investments1 ($ Bn)

$42 Bn2018

$50 Bn2019

$42.6 BnJan-Sep'20

xx Annual (Calendar Year) FDI Inflows

1. Denotes total inward FDI to India; 2. Sep'20 figures are provisionalSource: CMIENote: Past period data may vary from the previous versions of the Economic Monitor owing to restating of previous years’ data by the CMIE/reporting agencies

MACROECONOMIC INDICATORS

6

Including Reliance-Jio Deals

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Foreign Institutional Investments remained somber in Jan-Sep'20

Jan-

20

Apr-1

8

Jan-

18

Jul-1

8

1.9

Feb-

18

May

-18

Nov

-18

Sep-

19

Mar

-18

2.7

Jun-

18

May

-19

1.7Se

p-18

Oct

-18

-2.1

3.0

Dec

-18

Jan-

19

Feb-

19

-4.2

Mar

-19

Apr-1

9

Jun-

19

Jul-1

9

Aug-

19

4.6

Oct

-19

Nov

-19

Dec

-19

0.3

Feb-

20

Mar

-20

Apr-2

0

6.0

May

-20

Jun-

20

-15.0

Jul-2

0

Aug-

20

3.40.3 0.3

-1.4 -3.2

0.6

-1.7-4.9

Aug-

18

-0.5-1.4

1.9

9.3

1.2 2.0

-0.5-3.8

2.2

-1.0-1.5

3.16.7

Sep-

201

-0.3-1.0

Foreign Institutional Investments ($ Bn)

-$11 Bn2018

$26 Bn2019

-$6.5 BnJan-Sep'20

xx Annual (Calendar Year) FIIs

1. Sep'20 figures are provisionalSource: CMIENote: Past period data may vary from the previous versions of the Economic Monitor owing to restating of previous years’ data by the CMIE/reporting agencies

MACROECONOMIC INDICATORS

6

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Both Manufacturing & Services PMI remained beyond the 50-point mark in Nov'20, however, witnessed a marginal dip vs. Oct'20 highs

SENTIMENT –MFG. & SERVICES PMI

7

Note: The Purchasing Managers Index (PMI) is a measure of the prevailing direction of economic trends in manufacturing and services sectors. The PMI is based on a monthly survey of supply chain managers across 19 industries, covering both upstream and downstream activity. Value >50 indicates possible expansion in the sector, and value

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Consumer sentiment marginally dipped in Nov'20 vs. Oct'20;rural sentiment remained better than urban

SENTIMENT-CONSUMER SENTIMENT

7

Source: CMIE Consumer Pyramids Survey

CMIE Consumer Sentiment Survey Rural Consumer Sentiment Index

103103

102100

54 52 50 43 44 47 43 44 45 41 45 43 45 43 41 49 48 43 46 47 48 47 51 45 47 52 51 5153 57 57 56 56 56 55 50

0

100

50

150

01-M

ar

06-S

ep

22-M

ar

25-O

ct

24-M

ay

15-M

ar

29-M

ar

29-N

ov

05-A

pr12

-Apr

23-A

ug

19-A

pr

31-M

ay

26-A

pr03

-May

18-O

ct11

-Oct

26-Ju

l

10-M

ay17

-May

07-Ju

n14

-Jun

21-Ju

n28

-Jun

19-Ju

l

05-Ju

l12

-Jul

02-A

ug09

-Aug

08-M

ar

30-A

ug

08-N

ov

13-S

ep20

-Sep

16-A

ug

04-O

ct

01-N

ov

15-N

ov22

-Nov

27-S

ep

103101

10195

48 39 41 42 40 35 35 35 35 35 38 38 37 41 43 44 41 40 39 44 40 37 36 37 41 42 41 4047 48 45 46 45 49 45 48

0

50

100

150

15-N

ov

21-Ju

n

25-O

ct

22-M

ar

07-Ju

n

15-M

ar08

-Mar

26-A

pr

29-M

ar05

-Apr

12-A

pr19

-Apr

03-M

ay10

-May

26-Ju

l

05-Ju

l

17-M

ay

08-N

ov

24-M

ay31

-May

14-Ju

n

28-Ju

n

12-Ju

l

11-O

ct

19-Ju

l

02-A

ug09

-Aug

06-S

ep

16-A

ug

01-M

ar

30-A

ug

13-S

ep20

-Sep

27-S

ep

23-A

ug

18-O

ct

01-N

ov

22-N

ov29

-Nov

04-O

ct

Sample Size• 1.74L households in 90 cities and 969

villages surveyed over 4 months

Methodology• Longitudinal survey: Same set of

households surveyed in batches over time

• Scoring based on 5 questions:– Perception of current well-being– Expectations of future well-being– Perceptions of current economic

conditions of the country – Perceptions of prospective

economic conditions of the country

– Household's propensity to spend on consumer durables

Urban Consumer Sentiment Index

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Healthcare, IT, Tech. & Energy continued in positive territory in BSE; PSU, CPSE & Realty saw maximum decline in Nov'20

SENTIMENT – BSE SECTORAL INDICES

7

1. Growth rate vs. 01-Feb-202. The S&P BSE TECk index comprises constituents of the S&P BSE 500 that are classified as members of the media & publishing, information technology & telecommunications sector3. CPSE- Central Public Sector EnterprisesSource : BSE, Bloomberg, BCG analysis

BSE Sectoral Indices Descending order of performance1

-20

-10

-40

0

10

50

20

30

40

60

-50

-30

01-F

eb

12-M

ay

19-F

eb

01-Ju

n

11-M

ar

30-M

ar

22-A

pr

18-Ju

n

Change (%)

10-Ju

l

27-Ju

l

11-A

ug

26-A

ug

12-O

ct

25-S

ep

27-O

ct

11-N

ov

26-N

ov

10-S

ep

Sector % ChangeHealthcare 50.04%

IT 37.63%TECk2 27.68%Energy 26.23%

Basic Materials 20.16%Auto 14.98%Metal 13.21%

BSE 500 12.72%Consumer Discretionary 10.44%

Power 9.54%Industrials 9.07%

Consumer Durables 4.51%Capital Goods 3.17%

FMCG 3.08%Finance 1.36%Telecom 0.83%Bankex -0.19%

Oil and Gas -0.23%Infra -2.30%

Utilities -3.37%Realty -8.37%CPSE3 -11.21%PSU -14.76%

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Value of stock market transactions improved in Nov'20 vs. Sep-Oct'20 levels; Mutual fund AUM grew by 11% YoY in Nov'20

SENTIMENT –STOCK MKT. TRANSACTIONS

7

1. Volatility Index is a measure of market’s expectation of volatility over the near term; India VIX is a volatility index based on the NIFTY50 Index Option prices providing the expected market volatility over the next 30 calendar days – figures represented are as of end of every month shown2. Mutual funds Assets Under Management (AUM) represented as recorded at end of every month shownSource: BSE, NSE, AMFI, BCG analysis

Stock Market Transactions (INR k Cr)

-3% -5% 5%

15

30

35

0

5

10

20

25

27.1

Apr-20 May-20 Jun-20

27.5

Jul-20 Aug-20

28.2

Sep-20 Oct-20

23.9 24.525.5 26.9

Nov-20

30.0

Mutual Funds AUM include investments from individuals (50.5%) & institutions (49.5%); institutions include domestic & foreign institutions and banks

11%

Mutual Funds AUM2 (INR L Cr)

3430

2925 23 20

2520

0

20

40

60

80

0

500

1,000

1,500

India Volatility Index (VIX) 1

1,3371,223

Apr-20 May-20

Tran

sact

ion

Valu

e ( I

NR

) k C

r

Jul-20

44

Aug-20

906

80

65

1,0991,000

71110

1,351

Jun-20

1,349

93

1,283

70

Sep-20

58

Oct-20 Nov-20

BSE NSE India VIX

21% 12% 135%BSE YoY

42% 27% 127%NSE YoY

66%

89%

8%83%

90%

10%33%

72%

7%2%

46%

11%30%

60%

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GDP Deep-Dive2

Economic Indicators1

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COVID-19

$2.2trillion

$2.4trillion

$2.6trillion

$2.8trillion

Note: Real GDP at 2011-12 base prices, converted from INR using 2011-12 exchange rates (Rs. 47.95); The numbers would differ from estimates from World Bank, IMF, etc. due to difference in the base year (we use 2011-12)Source: CMIE, BCG Analysis

Economy contracted by 7.5% YoY in Jul-Sep'20 while YoY gap improved vs. previous quarter; Real GDP reached almost to Jul-Sep'17 levels

xx Overall size of economy at the end of FY

GDPDEEP-DIVE

$2.9trillion

577

633674

716748

691

800

500

600

700

Jul-Sep’16

Jul-Sep’15

Real GDP ($ Bn)

Jul-Sep’17

Jul-Sep’18

Jul-Sep’19

Jul-Sep’20

+6.2%+4.4%

-7.5%

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COVID-19 The break-up of GDP across components shows a decline vs. Jul-Sep'19 levels

Source: CMIE, BCG AnalysisNote: Highlighted circles represents growth (green) or decline (yellow) compared to the previous year quarter (Jul-Sep'20 vs Jul-Sep'19)

I XC G MY

-2.9% -2.2%6.4% 14.2% -9.4%4.4%Jul-Sep2019

-5.8% -8.5%2.7% 13.6% -7.0%3.1%Jan-Mar2020

-8.89% -1.52%-11.32% -22.18% -17.16%-7.54%Jul-Sep2020

-4.3% -6.1%6.6% 13.4% -12.4%4.1%Oct-Dec 2019

Quarterly growth %

change YoY GDPPvt.

ConsumptionGovt.

ConsumptionGross

Investment Exports Imports

GDPDEEP-DIVE

-47.5% -19.8%-26.7% 16.4% -40.4%-23.9%Apr-Jun2020

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COVID-19 Share of investments in GDP increased in the Jul-Sep'20 while that of govt. consumption declined vs. the previous quarter

55.8% 56.2% 55.5% 58.5% 56.1% 56.4% 56.5% 59.9% 55.9% 54.3% 54.2%

35.1% 35.4% 34.6% 35.2% 34.8% 35.4% 32.2% 32.4% 31.8%24.4% 31.7%

8.4% 11.7% 11.9% 9.8% 9.1% 11.8% 13.0% 10.6% 10.0%18.1% 10.9%

4.3% 0.3% 2.1% 1.4% 0.4%

-1.7%

3.9% 1.7%0.3%

Apr-Jun’18

-3.6% -4.1%

Jan-Mar’18 Oct-Dec’19

-3.6%

Jul-Sep’18

-3.0%-0.5%

Apr-Jun’19Oct-Dec’18

-1.4%

Jan-Mar’19 Jul-Sep’19

-1.2% -1.6%-2.1%

Jan-Mar’20

2.8% 1.4%

Apr-Jun’20 Jul-Sep’20

-0.3%-3.3%

1. Statistical Discrepancy: taking the GDP from the production approach as the control total, gives the measure of the overall difference between the production approach and the expenditure approach followed for estimation.Note: This composition is basis Real GDPSource: CMIE, BCG Analysis, MOSPI

Private final consumption expenditure Government final consumption expenditure Discrepencies 1Net exportsInvestments

Net exports remained within

the positive territory

GDPDEEP-DIVE

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COVID-19 Private consumption recovered while government consumption recorded steep decline in Jul-Sep'20 vs. previous quarter

Source: CMIE, BCG Analysis, RBI, Press articles

6.4

-26.7

-11.3

14.216.4

-22.2

-50

-25

0

25

Oct-Dec’18 Jul-Sep’20

Final Consumption Expenditure, % change YoY

Jan-Mar’19Jul-Sep’18 Apr-Jun’19 Jul-Sep’19 Oct-Dec’19 Jan-Mar’20 Apr-Jun’20

Private Government

GDPDEEP-DIVE

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COVID-19 Gross capital formation improved vs. previous quarter however still in the negative territory in Jul-Sep'20

Source: CMIE

-2.9

-47.5

-8.9

-50

-25

25

0

Oct-Dec’18 Jul-Sep’19

Gross Capital Formation, % change YoY

Jul-Sep’18 Jan-Mar’19 Apr-Jun’19 Oct-Dec’19 Jan-Mar’20 Apr-Jun’20 Jul-Sep’20

Growth in capital formation remains in the

negative territory

GDPDEEP-DIVE

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COVID-19 Growth in agriculture and allied activities remained stable while growth industry & services noticeably improved vs. previous quarter in Jul-Sep'20

56.4%

31.1%

12.5%

Jul-Sep’20

100%

Share inIndustry GVA

3.86%Agriculture

2.43%Industry

1.76%Services

Jul-Sep Qtr. CAGR1over 2016-20

GDPDEEP-DIVE

3.4-2.1-11.4

-60

-40

-20

0

20

GVA Quarterly growth, % change YoY

Jul-Sep’17

Jul-Sep’16

Jul-Sep’18

Jul-Sep’19

Jul-Sep’20

Agriculture, forestry & fishing ServicesIndustry

1. CAGR= [(Value of GVA in INR Mn in Jul-Sep'20/Value of GVA in INR Mn in Jul-Sep'16)^(1/4)]-1 Source: CMIE, BCG Analysis

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COVID-19 Major components of the services sector dipped while trade, hotels, transport, storage & communication improved vs. previous quarter

-15.6

-8.1

-12.2

-60

-40

-20

0

20

Services GVA Quarterly growth, % change YoY

Jul-Sep’16

Jul-Sep’17

Jul-Sep’18

Jul-Sep’19

Jul-Sep’20

Trade, hotels, transport, storage and communicationFinancial services, real estate and business servicesCommunity, social and personal services

46.2%

30.0%

23.7%

Jul-Sep’20

100%

Share inIndustry GVA

3.58%Community, social

and personal services

0.62%Trade, hotels,

transport, storage and communication

1.64%Financial services,

real estate andbusiness services

Jul-Sep Qtr. CAGR1over 2016-20

GDPDEEP-DIVE

1. CAGR= [(Value of GVA in INR Mn in Jul-Sep'20/Value of GVA in INR Mn in Jul-Sep'16)^(1/4)]-1 Source: CMIE, BCG Analysis

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COVID-19 Industrial sector improved vs. previous quarter, especially manufacturing & utility services that saw positive YoY growth in Jul-Sep'20

-9.1

0.6 4.4

-8.6

20

-60

-40

-20

0

Industry GVA Quarterly growth, % change YoY

Jul-Sep’16

Jul-Sep’17

Jul-Sep’20

Jul-Sep’18

Jul-Sep’19

Mining and quarrying Electricity, gas, water supply and otherutility services

Manufacturing Construction

61.1%

23.5%

8.8%6.6%100%

Jul-Sep’20

Share inIndustry GVA

-1.82%Mining and quarrying

7.43%Electricity, gas,

water supply and other utility services

3.31%Manufacturing

Jul-Sep Qtr. CAGR1over 2016-20

GDPDEEP-DIVE

0.03%Construction

1. CAGR= [(Value of GVA in INR Mn in Jul-Sep'20/Value of GVA in INR Mn in Jul-Sep'16)^(1/4)]-1 Source: CMIE, BCG Analysis

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Indian GDP growth forecasts revised upwards to 7.4-10.6% contractionin the financial year

5.2 5.1 5.2 5.83.5 0.8 3.5 1.5

CrisilFitch Ratings

Barclays DBS

-1.7 -4.3 -1.7 -4.3

6.0 5.5 5.8 3.32.1 3.6 1.9 1.6

EIU India Ratings

IMF Goldman Sachs

-3.9 -1.9 -3.9 -1.7

May-Jun Sep-Oct

1. Pre-lockdown forecasts were made during Feb-2020/early Mar-2020; 2. Post-lockdown forecasts refer to forecasts made between 25-Mar to 20-Sep-20203. Pre-lockdown forecast for SBI is as of 16-Apr-2020Source: Analysts reports, BCG analysis

India GDP growth forecast for FY21 (YoY, %)Mar-Apr

4.7 3.3 5.8 5.5

-5.0 -5.0 -4.5 -4.0

ICRA Goldman Sachs

Moody’sIMF

-9.7 -8.3 -10.3 -9.5

1.15.5 4.5 5.2

-6.8 -5.3 -6.0-3.2

BarclaysSBI3 India Ratings

Deutsche Bank

-7.9-10.8 -10.5 -8.4

Pre-lockdown forecasts1

Post-lockdown forecasts2

3.6% to 0.8% -3.2% to -6.8%

Jul-Aug

-4.5% to -10.9%

Data as of 18 Dec; Estimates likely to be revised further

4.1 4.7 5.5

-6.0-9.5

-4.5

Bank of America

ICRA FICCI

-10.1 -14.2 -10.0

5.8 5.71.1

-6.0 -6.1-10.9

DBS Nomura SBI3

-11.8 -11.8-12.0

NON - EXHAUSTIVE

5.8 6.0 5.7 5.5

-10.3 -9.5 -10.8 -11.5IMF RBI Nomura Moody’s

-16.1 -15.5 -16.5 -17.0

-9.5% to -14.8%

GDP FORECASTS

5.5 5.1 3.3 4.7

-11.8 -10.5-14.8

-11.0

ICRAIndia Ratings

Fitch Ratings

Goldman Sachs

-17.3 -15.6 -18.1 -15.7

GDP Growth Forecast % Range

3.3 6.0 5.2 5.5

-10.3-7.5 -7.7

-10.6Goldman

SachsRBI S&P

GlobalMoody’s

-13.6 -13.5 -12.9 -16.1

5.81.1

5.1 4.7

-9.0 -7.4 -9.4 -7.8

ICRADBS SBI3 Fitch Ratings

-14.8-9.1

-14.5 -12.5

-7.4% to -10.6%

Nov-Dec

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India Economic Monitor�December 2020 UpdateSlide Number 2COVID-19 cases in India on a continuous rise in Nov-Dec'20 albeit with a declining active case count and improved recovery rateSlide Number 4Summary: Nov'20 trends continued to show improvement across most indicators, with select indicators exceeding last year levelsSlide Number 6Slide Number 7Slide Number 8Slide Number 9Slide Number 10Slide Number 11Oct'20 retail transactions observed strong growth vs. previous months & last year; Stronger YoY growth in volume as compared to valueValue of UPI transactions in Nov'20 continued to spike by 100+% vs. previous year's levels, hitting a new milestoneConsumption of steel grew in Nov'20 vs. last year & previous months; Cement production grew vs. Oct'20 and Mar-Sep'20 levels2W & tractor sales continued to improve vs. last year levels;�Passenger vehicle & 3W sales witnessed a dip in Nov'20 vs. last yearPharma sales continued to grow vs. last year while fertilizer sales witnessed a contraction vs. last year levels in Nov'20Non-life insurance premium observed an uptick while life insurance premium noticeably declined vs. last year levels in Nov'20Central Govt.'s revenue & expenditure increased YoY in Oct'20;�GST collections continued to grow vs. last year in Nov'20Count & value of tenders announced by Central & State Govts. continued to grow in Nov'20 vs. last year levels Slide Number 20Slide Number 21Slide Number 22Nov'20 repo & reverse repo rate remained at the same level; base rate & MCLR on bank borrowings marginally dipped vs. previous monthsINR remained rangebound between ~73/dollar & ~74/dollar;�Forex reserves reached their new peak at ~575 USD Bn in Nov'20India witnessed significant FDI in Jan-Sep'20Foreign Institutional Investments remained somber in Jan-Sep'20Slide Number 27Consumer sentiment marginally dipped in Nov'20 vs. Oct'20;�rural sentiment remained better than urbanSlide Number 29Value of stock market transactions improved in Nov'20 vs. Sep-Oct'20 levels; Mutual fund AUM grew by 11% YoY in Nov'20Slide Number 31Economy contracted by 7.5% YoY in Jul-Sep'20 while YoY gap improved vs. previous quarter; Real GDP reached almost to Jul-Sep'17 levels The break-up of GDP across components shows a decline vs. Jul-Sep'19 levelsShare of investments in GDP increased in the Jul-Sep'20 while that of govt. consumption declined vs. the previous quarterPrivate consumption recovered while government consumption recorded steep decline in Jul-Sep'20 vs. previous quarterSlide Number 36Slide Number 37Slide Number 38Slide Number 39Indian GDP growth forecasts revised upwards to 7.4-10.6% contraction�in the financial yearBCG can support you in leading in the new realitySlide Number 42