Current state of Indian Economy

November 2010

Federation of Indian Chambers of Commerce and Industry

New Delhi

1
Highlights – November 2010

After two successive months of slow down in the 2010-11 (August and September), the Index of
Industrial Production (IIP) rose sharply in October 2010. The overall growth in IIP was 10.8 per
cent during the month as compared to 10.1 per cent in October 2009. The highest growth has
been coming from manufacturing sector followed by electricity and mining.

Core infrastructure sectors grew by 7.0 per cent in October 2010 as compared to the growth of
3.9 per cent in October 2009. The October growth has been recorded as the highest so far in the
current fiscal 2010-11. Except the sectors like petroleum refinery and coal, all major
infrastructure industries have displayed much improvement in output expansion during the
month.

The headline inflation has somewhat eased in October 2010. On y-o-y basis WPI growth
remained high, but the monthly trend of inflation revealed decline in the month of October
2010 compared to the recorded inflation in the previous month. WPI growth under three major
heads namely primary articles, fuel & power and manufactured products eased a bit in October
compared to September 2010. In RBI‘s assessment, the current rate of inflation is still well
above the comfort zone. Food inflation continues to remain a matter of concern on account of
rising prices of vegetables in the recent months.

The broad money supply in the economy expanded by 8.4 percent calculated October over April
2010-11. The net bank credit to the commercial sector was also observed to grow well during
the period; only bank’s Investments in government and other approved securities experienced
setback in October 2010 compared to better growth seen in the same month of 2009.

The fiscal performance of Central government during October 2010 continued to accomplish
higher revenue growth vis-a-vis the expenditure growth during the month. Consequently, the
fiscal deficit has narrowed down during April to October in 2010 -11 as compared to the
previous fiscal.

India’s cumulative merchandise exports during April to October in 2010-11 were valued at USD
121.4 billion which was substantially higher than USD 95.6 billion during the same period of
2009-10. The aggregate trade deficit magnified to the level of USD 72.8 billion during April to
October in 2010-11 as against the amount of USD 58.3 billion during the same period of 2009-
10.

India saw greater volume of foreign capital inflows in the recent months. In October 2010, total
foreign investment witnessed almost a six fold increase from the level observed during October
2009. The capital surge is continued driven by FII flows. According to Planning commission, the
inflow would not destabilize the economy as India’s large current account deficit can absorb
capital flows to some extent.

2
 Contents

Title Page

1 Industrial Growth 6

2 Core Infrastructure Industries 2

3 Trends in Inflation 9

4 Monetary Indicators 10

5 Stock Market Trends 11

6 Fiscal Management 12

7 Foreign Trade 14

8 Capital Inflows 15

9 Foreign Exchange Reserves 16

3
List of Tables and Graphs

Table- 1.1: Growth of Industry: Recent Trends (in percentage) 6

Table -1.2: Growth in 17 Industry sectors 7
Table-1.3: Growth in six-core infrastructure industries (% change) 8
Table-1.4: Growth in six-core infrastructure industries (% change) 8
Table-1.5. Monthly trends in Wholesale price index- monthly average (% change) 9
Table-1.6: Monthly trends in consumer prices (% change) 9
Table-1.7: Monetary sector indicators 10
Table-1.8: Monthly trends in stock market indices 11
Table-1.9: Trends in cumulative tax collections of central government (%) 12
Table-1.10: Service Tax 13
Table-1.11: Trends in central government finances: 13
Table-1.12: Monthly trends in growth of merchandize trade (% change) 14
Table-1.13: Monthly trends in foreign investments ($ million) 15
Table-1.14: Monthly trends in foreign exchange reserves ($ billion) 16

4
1. Industrial growth

In y-o-y terms, industrial production envisaged higher growth compared to the growth of 10.1
percent registered in October 2009. The growth was mainly fuelled by the manufacturing, posted
11.3 percent growth as against the growth of 10.8 percent in the same month of previous year.

However, growth in October 2010 dampened to the extent of 6.5 percent in the mining sector vis a-
vis the growth of 9.1 percent in October 2009.

Going by the use based classification, the industrial growth in October 2010 primarily emerged from
22.0 percent growth in capital goods sector followed by the support of intermediate (9.5 percent)
and basic goods (7.7 percent) sector. The expansion in capital goods industry marked a turnaround
relative to its sharp contraction in previous month September. Although the cumulative growth of
capital goods during April to October 2010 was encouraging, but the volatility in monthly growth of
capital goods has been considerably high ranging from a negative growth of 4.1 percent to 65.0
percent in recent months.

The consumer goods segment showed positive outlook during the month. But the overall growth at
9.6 per cent in October 2010 was low compared to the growth of 11.4 per cent seen in same month
of 2009. The growth in sub index, in particular, the consumer durables sector observed a spectacular
growth of 31.0 percent during the month. This highlighted the robustness of consumers’ demand as
a key driver of economic growth in India. In addition, the high growth in consumer durables is
largely attributed to the building up of inventories on account of festive seasons in India.

The only exception was 0.1 percent increase in consumer non durables items in October 2010. The
growth trends of this index continued to remain sluggish since the beginning of the current fiscal,
broadly contemplating the impact of high food inflation.

In terms of industries, ten out of seventeen industry segments registered higher growth compard to
that of the prevuious year. These industry segments mainly include ‘transport Equipment and Parts’
with highest growth of 39.5 per cent, followed by 26.0 percent growth in ‘Leather and Leather & Fur
Products’ and a growth of 24.6 percent in ‘Other Manufacturing Industries’.

5
1.1: Growth of Industry: Recent Trends (in percentage)

Weights Oct Oct

2009 2010

Industry 100 10.1 10.8

Mining 10.2 9.1 6.5
Manufacturing 79.4 10.8 11.3
Electricity 10.5 4.0 8.8
Use Based Classification
Basic 35.6 4.0 7.7
Intermediate 26.5 15.4 9.5
Capital 9.3 10.9 22.0
Consumer Goods 28.7 11.4 9.6
Consumer non Durables 23.3 8.6 0.1
Consumer Durables 5.4 18.3 31.0

Table- 1.2: Growth in 17 Industry sectors

17 industry sectors
Food Products 9.1 2.6 9.1
Beverages, Tobacco and Related Products 2.4 0.2 3.1
Cotton Textiles 5.5 12.3 13.0
Wool, Silk and man-made fiber textiles 2.3 18.0 2.7
Jute and other vegetable fiber Textiles (except 0.6 -15.5 -0.5
cotton)
Textile Products (including Wearing Apparel) 2.5 16.9 10.3
Wood and Wood Products; Furniture and Fixtures 2.7 19.5 -25.7
Paper & Paper Products and Printing, Publishing & 2.6 0.6 11.3
Allied Industries
Leather and Leather & Fur Products 1.1 8.9 26.0
Basic Chemicals & Chemical Products (except products of 14.0 19.3 1.1
Petroleum & Coal)
Rubber, Plastic, Petroleum and Coal Products 5.7 14.3 1.3
Non-Metallic Mineral Products 4.4 4.0 14.0
Basic Metal and Alloy Industries 7.5 -1.1 8.8
Metal Products and Parts, except Machinery 2.8 9.2 19.5
and Equipment
Machinery and Equipment other than Transport 9.6 16.4 15.9
Equipment
Transport Equipment and Parts 4.0 18.2 39.5
Other Manufacturing Industries 2.5 0.8 24.6
Source: Central Statistical Organization

6
 2 Core infrastructure industries

The six core infrastructure industries weighing 26.7 percent in IIP showed a sharp rebound in
production during the month of October 2010. After a growth of 2.5 percent in September this year,
the output of key industries surged by 7 per cent in October 2010. This has been recorded as the
highest growth rate so far in the current fiscal. On a year-on year basis this growth rate surpassed
the 3.9 percent growth observed in October 2009. The cement industry clocked the highest growth
of 16.8 per cent followed by crude oil (13.7 percent) and electricity generation (8.4 percent) vis-à-
vis the growth of 5.3 percent, (-)2.1 percent and 4.4 percent respectively in October last year.

Among the laggards were petroleum refinery which decelerated in output by 4.8 per cent during
October 2010 corresponding to a growth of 7.2 per cent in the same month of 2009. The other
suffered sector was coal industry, this observed marginal expansion of output only by 0.8 percent
during the month as against the robust 6.8 per cent growth in the same month of 2009.

Table-1.3: Growth in six-core infrastructure industries (% change) October 2010

All Finished steel Cement Crude

infrastructure petroleum
industries
08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 4.6 3.7 5.1 7.5 -1.3 4.7 6.9 11.9 8.7 1.0 -3.1 5.2
May 4.4 3.2 5.0 8.3 2.8 2.5 3.8 11.8 8.6 3.2 -4.3 5.8
June 4.4 6.3 3.4 8.1 3.6 3.5 6.6 12.7 3.6 -4.7 4.0 6.8
July 5.2 3.2 3.9 6.3 4.0 -0.9 5.5 13.8 -0.2 -3.0 -0.4 15.8
August 2.0 6.5 3.7 3.3 0.3 7.7 1.9 17.6 1.6 -1.0 -2.6 15.0
September 4.1 4.3 2.5 2.3 0.8 5.8 8.1 6.5 5.2 -0.4 -0.5 12.5
October 2.4 3.9 7.0 -3.8 2.5 12.1 6.2 5.3 16.8 -0.2 -2.1 13.7
November 0.8 6.0 -6.3 11.7 8.7 9.0 0.5 -1.5
December 0.7 6.4 -8.0 9.6 11.6 11.0 -0.3 1.1
January 2.2 9.4 3.2 16.2 8.3 12.4 -8.1 9.7
February 1.9 4.5 2.4 0.9 8.3 5.8 -6.2 4.0
March 3.3 7.2 -1.8 9.2 10.1 7.8 -2.3 3.5
Source: Ministry of
Industry

7
Table-1.4: Growth in six-core infrastructure industries (% change)

Petroleum Coal Power

refinery
08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 4.3 -4.5 5.3 10.4 13.2 -2.3 1.4 6.7 6.0
May 0.1 -4.3 7.7 8.8 10.4 0.1 2.0 3.0 6.4
June 5.6 -3.8 2.9 6.1 15.2 0.9 2.6 7.7 3.4
July 11.8 -14.4 13.7 5.5 10.5 4.5 4.5 3.8 3.8
August 2.5 3.1 -2.3 5.9 12.9 1.0 0.8 10.2 1.0
September 2.8 3.4 -10.2 11.2 6.5 -2.0 4.4 7.4 1.3
October 5.0 7.2 -4.8 10.6 6.8 0.8 4.4 4.4 8.3
November -1.1 4.9 9.7 4.6 2.6 3.3
December 3.0 0.8 11.2 2.5 1.5 6.7
January -1.3 3.8 6.7 6.0 1.8 5.6
February 0.5 0.8 6.0 6.8 0.6 7.3
March 3.3 -0.4 5.2 7.8 6.3 7.8

Source: Ministry of Industry

8
 3. Trends in inflation
The WPI based inflation declined to 8.6 percent in October 2010 from 8.9 percent in the previous
month. However, y-o-y numbers show overall Inflation much higher compared to the increase of
1.5 percent in October 2009. The primary articles witnessed an increase in WPI index during the
month as the indices rose by 16.7 percent in October 2010. Inflation in the fuel & power was high at
11.0 percent in October as compared to the negative 6.8 percent during the same month of 2009.
The modest increase was seen in the manufactured products, 4.7 percent in October as against 0.6
percent increase in the same month of previous year.

Table-1.5. Monthly trends in Wholesale price index- monthly average (% change)

2009 2010

Sept Oct Sept Oct

All Commodities 1.1 1.5 8.9 8.6
I Primary Article 10.6 10.3 18.2 16.7
(A) Food Articles 13.9 12.5 16.3 14.1
(B) Non-Food Articles -0.9 1.8 20.8 22.2
II Fuel & Power -8.1 -6.8 11.1 11.0
III Manufactured Products 0.2 0.6 4.8 4.7
(A) Food Products 12.1 13.0 3.6 3.0
(B) Beverages, Tobacco & Tobacco Products 6.8 6.4 6.3 6.1
(C) Textiles 1.5 2.4 9.8 9.9
(D) Wood & Wood Products 9.5 11.7 2.8 1.4
(E) Paper & Paper Products 2.1 1.4 5.3 4.7
(F) Leather & Leather Products 3.6 5.0 -0.1 -1.4
(G) Rubber & Plastic Products -1.7 -1.8 4.7 5.4
(H) Chemicals & Chemical Products -2.2 -2.1 4.6 4.9
(I) Non-Metallic Mineral Products 8.4 8.9 1.6 2.1
(J) Basic Metals Alloys & Metals Products -11.7 -11.0 6.3 6.4
(K) Machinery & Machine Tools -0.7 -0.4 3.4 3.1
(L) Transport Equipment & Parts 3.0 3.0 2.9 2.9
Source: Reserve Bank of India
Table-1.6: Monthly trends in consumer prices (% change)
CPI-IW CPI-UNME CPI-AL CPI-RL
08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 7.8 8.7 13.3 7.0 8.8 14.4 8.9 9.1 15.0 8.6 9.1 15.0
May 7.8 8.6 13.9 6.8 9.7 14.1 9.1 10.2 13.7 8.8 10.2 13.7
June 7.7 9.3 13.7 7.3 9.6 14.1 8.8 11.5 13.0 8.8 11.3 13.0
July 8.3 11.9 11.3 7.4 13.0 11.5 9.4 12.9 11.0 9.4 12.7 11.2
August 9.0 11.7 9.9 8.5 12.9 10.3 10.3 12.9 9.7 10.3 12.7 9.7
September 9.8 11.6 9.8 9.5 12.4 10.4 11.0 13.2 9.1 11.0 13.0 9.3
October 10.4 11.5 9.7 10.4 12.0 9.6 11.1 13.7 8.4 11.1 13.5 8.5
November 10.4 13.5 10.8 13.9 11.1 15.7 11.1 15.7
December 9.7 15.0 9.8 15.5 11.1 17.2 11.1 17.0
January 10.4 16.2 10.4 16.9 11.4 17.6 11.1 17.4
February 9.6 14.9 9.9 15.8 10.8 16.5 10.8 16.5
March 8.0 14.9 9.3 14.9 9.5 15.8 9.7 15.5
Source: Ministry of Labor, CMIE

9
4. Monetary indicators

The broad money supply (M3) in the economy rose sharply by 8.4 percent during the period from
April to October in 2010-11 in contrast to an increase of 8.1 percent during the same period in
previous fiscal. During the period from April to October 2010-11, the net Bank Credit to Government
grew at the rate of 6.9 percent. This was half of the growth observed during the same period in
2009-10. The net bank credit to the commercial sector grew at much faster pace of 6.9 percent in
October over April 2010 as compared to the growth of 3.1 percent during the same period of 2009-
10.

Aggregate deposits in scheduled commercial banks saw an increase of 10.1 percent over the period
April to October 2010-11 as compared to the expansion of 9.1 percent during the same period of
2009-10.

Investments in government and other approved securities witnessed a perceptible setback in

growth as it increased only by 5.0 percent in October 2010-11. This growth was turned out be
abysmally low compared to the growth of 15.7 percent recorded during the same period in 2009-10.

Table-1.7: Monetary sector indicators – up to October (October 2010-11 over March 2009-10)

Variation in M3 (Rs Variation in M3 (%)

crore)
08-09 09-10 10-11 08-09 09-10 10-11
April 22235 124682 42384 0.6 2.6 0.8
May 73398 172709 92656 1.9 3.6 1.7
June 89283 172702 77314 2.2 3.6 1.4
July 169734 253921 191240 4.2 5.3 3.4
August 208571 280313 270884 5.2 5.9 4.1
September 264364 325757 272432 6.6 6.8 4.9
October 331450 388071 468953 8.3 8.1 8.4
November 374193 431266 9.3 9.1
December 423509 521426 10.6 10.9
January 508078 575387 12.7 12.1
February 635810 652944 15.9 13.7
March 740332 806190 18.4 16.9

Source: Reserve Bank of India

10
5. Stock market trends

The indices Sensex and Nifty saw a minor decline during October 2010. On the first day of November
2010, the Sensex and and the S&P CNX NIFTY traded at 20355 k and 6118 k respectively indicating a
slight decline from the indices observed on October 1, 2010. However, observation of the indices in
the recent period shows high investment sentiments in the Indian stock market, mainly on account
of larger FIIs flows into the economy.

Table-1.8: Monthly trends in stock market indices (beginning of month figures)

S&P CNX
Date BSE Sensex % Change % Change
NIFTY
1.01.08 20300 4.8 6144 6.6
1.02.08 18242 -10.1 5317 -13.5
3.03.08 16677 -8.5 4953 -6.8
1.04.08 15626 -6.3 4739 -4.3
2.05.08 17600 12.6 5228 10.3
2.06.08 16063 -8.7 4739 -9.3
1.07.08 12961 -19.3 3896 -17.8
1.08.08 14656 13.1 4413 13.3
1.09.08 14498 -1.1 4447 0.8
1.10.08 13055 -9.9 3950 -11.1
3.11.08 10337 -20.8 3043 -23.0
1.12.08 8839 -14.5 2682 -11.9
26.12.08 9328 5.5 2857 6.5
30.01.09 9424 1.0 2874 0.5
02.03.09 8607 -8.7 2674 -7.0
31.03.09 9708 12.8 3020 12.9
29.04.09 11403 17.5 3473 15.0
01.06.09 14840 30.1 4529 30.4
01.07.09 14645 -1.31 4340 -4.1
03.08.09 15924 8.7 4711 8.5
01.09.09 15551 -2.3 4625 -1.8
01.10.09 17134 10.2 5083 9.9
03.11.09 15405 -10.1 4564 -10.2
01.12.09 17198 11.6 5122 12.2
04.01.10 17558 2.1 5232 2.1
01.02.10 16356 -6.8 4900 -6.4
02.03.10 16773 2.5 5017 2.4
01.04.10 17693 5.5 5291 5.5
03.05.10 17386 -1.7 5223 -1.3
01.06.10 16572 -4.7 4970 -4.8
01.07.10 17509 5.7 5251 5.7
02.08.10 18081 3.3 5431 3.4
01.09.10 18205 0.7 5471 0.7
01.10.10 20445 12.3 6143 12.3
01.12.10 20355 -0.4 6118 -0.4
Source: Reserve Bank of India

11
 6. Fiscal Management

Total government expenditure stepped from Rs 536861 crores during the period from April to
October in 2009-10 up to the level of Rs 617435 crores during the same period in current fiscal
2010-11. On year on year basis, the growth in expenditure has been 15 percent during the period.
Total revenue receipts saw an upsurge by more than 1.5 times during the period April to October in
2010-11. In absolute terms, the total revenue receipts magnified from Rs 284479 crores in the
seventh of 2009-10 to Rs 447625 crores in the same month of 2010-11. As an outcome, the
cumulative amount of fiscal deficit has gone down by almost 34 percent over the same period of
2009-10.

On tax collection front, buoyant performance of central government continued as gross tax revenue
grew by 26.4 percent during October 2010 vis-a-vis net decline by 7.5 percent during same month of
2009. Growth in profits of Indian industry was reflected in the tax collection which went up by 21
percent, the personal income tax grew by 10.7 percent in October 2010. Except for other taxes, all
major tax components of indirect taxes perceived commendable growth in October 2010
corresponding to their increase in the same month of 2009.

Table-1.9: Trends in cumulative tax collections of central government (%)

Gross tax revenue Corporation tax Income tax

08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 52.2 -16.9 27.0 55.0 -8.4 23.4 127.7 20.0 8.3
May 36.1 -11.8 22.0 58.1 10.1 -1.8 76.0 11.7 13.0
June 28.4 -11.4 28.6 43.4 1.8 23.7 50.0 7.1 13.8
July 26.2 -11.1 27.5 41.6 4.7 18.4 42.0 5.9 15.8
August 25.0 -11.5 27.3 45.9 2.4 18.3 35.7 8.1 13.9
September 25.3 -7.6 25.3 38.2 7.7 17.9 30.7 7.2 13.6
October 20.3 -7.5 26.4 30.3 6.5 21.0 21.9 10.5 10.7
November 17.5 -7.8 26.4 6.6 19.0 9.8
December 9.6 -2.5 11.9 16.8 6.8 12.2
January 7.2 -1.2 11.9 16.5 5.4 13.3
February 6.9 -1.6 17.9 10.9 7.5 11.4
March 2.7 10.8 7.1

Customs Excise duties Other taxes

08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 25.0 -52..6 106.4 -28.3 -114.2 314.1 9.04 -5.4 -43.2
May 24.1 -38.2 56.6 1.3 -23.3 49.3 26.7 -18.7 -11.7
June 19.9 -37.3 62.2 -0.9 -23.7 52.0 26.0 -9.5 -36.8
July 19.2 -34.7 57.4 4.0 -26.6 52.0 24.7 -3.87 -33.3
August 17.0 -34.0 59.8 6.5 -24.5 43.3 17.4 -1.97 -28.9
September 16.8 -32.9 61.8 6.6 -22.9 41.1 30.7 -20.5 -30.7
October 14.4 -31.7 63.7 6.3 -21.7 38.9 16.2 -17.2 -28.7
November 13.7 -31.2 5.1 -20.0 6.1 -15.0
December 11.1 -29.2 2.1 -18.2 -2.6 -24.2
January 6.4 -25.2 -2.6 -14.5 -6.4 -21.8
February 1.7 -21.8 -7.1 -10.2 -10.0 -19.8
March -4.1 -12.0 -11.5

Table-1.10: Service Tax

12
 Service Tax 08-09 09-10 10-11
April 62.3 -0.04 -6.0
May 40.7 -2.60 1.6
June 34.2 -2.85 9.1
July 29.7 -1.46 12.5
August 28.6 -2.29 13.8
September 31.8 -3.7 15.9
October 31.8 -5.3 17.3
November 30.2 -6.2
December 25.4 -5.9
January 24.6 -6.2
February 22.2 -5.9
March 18.6
Source: Controller General of Accounts

Table-1.11 Trends in central government finances: October 2010

Actual to budget estimates

( in Rs crores)
09-10 10-11
Revenue receipts 284479 447625
Tax revenue 213896 271693
Non tax revenue 70583 175932
Total receipts 291786 455099
Non plan expenditure 388837 424893
On revenue account 365535 379040
On capital account 23302 45853
Plan expenditure 148024 192542
On revenue account 125738 163415
On capital account 22286 29127
Total expenditure 536861 617435
Fiscal deficit 245075 162336
Source: Controller General of Accounts

13
7. Foreign trade

India’s merchandise exports in October 2010 rose by 21.3 percent to touch the level USD 18 billion
as compared to USD 14.8 billion achieved in October previous year. On the other hand, India’s
merchandise imports saw an increase of 6.8 per cent and were valued at USD 27.6 billion during this
month. So were the trade deficits that widened to USD 11.1 billion in October 2010 from USD 9.7
billion during the same month of 2009.

Table-1.12: Monthly trends in growth of merchandize trade (% change) up to October 2010

Exports Oil imports Non-oil imports Total imports

08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
pril 31.5 -33.2 36.2 46.2 -58.5 70.5 32.3 -24.6 34.3 36.6 -36.6 43.3
May 12.9 -29.2 35.1 50.8 -60.6 66.7 17.4 -25.4 28.2 27.1 -39.2 38.5
June 23.5 -27.7 30.4 53.4 -50.6 26.5 13.9 -16.5 21.5 25.9 -29.3 23.0
July 31.2 -28.4 13.2 69.3 -55.5 4.4 38.7 -24.5 49.6 48.1 -37.1 34.3
August 26.9 -19.4 22.5 76.7 -45.5 12.4 39.6 -25.5 41.1 51.2 -32.4 32.2
September 10.4 -13.8 23.2 57.1 -33.5 14.4 36.2 -30.4 31.2 43.3 -31.3 26.1
October -12.1 -6.6 21.3 22 -9.3 0.3 5.5 -17.2 9.9 10.6 -15.0 6.8
November -9.9 18.2 11.9 7.3 3.4 -5.9 6.1 -2.6
December -1.1 9.3 -30.9 42.8 31.9 22.4 8.8 27.2
January -15.9 11.5 -47.5 56.0 -0.5 28.8 -18.2 35.5
February -21.7 34.8 -47.5 97.4 -10.2 55.6 -23.3 66.4
March -33.3 54.1 -58.1 85.2 -18.9 61.0 -34.0 67.1

Source: Ministry of
Commerce

14
8. Capital inflows

The total foreign investments in the country were estimated at USD 30 billion in October 2010
representing almost six fold increase from an amount USD 5.3 billion during the same month of
2009. While the FDI stood at USD 1.4 billion in October 2010 representing a reduction from USD 2.3
billion in October 2009, the portfolio investments were valued at USD 28.7 billion in October 2010,
leaping from USD 2.9 billion during the same month of 2009.

Table-1.13: Monthly trends in foreign investments ($ millions)

Foreign direct Portfolio investments Total foreign

investments investments
08-09 09-10 10-11 08-09 09-10 10-11 08-09 09-10 10-11
April 3749 2339 2179 -880 2278 3315 2869 4617 5494
May 3932 2095 2213 -288 5639 41 3644 7734 2254
June 2392 2582 1380 -3010 353 1232 -618 2935 2612
July 2247 3476 1785 -492 2077 9114 1775 6508 10899
August 2328 3268 1330 593 926 -440 2921 4194 890
September 2562 1512 2118 -1403 4999 10577 1159 6511 12695
October 1497 2332 1392 -5243 2922 28694 -3746 5254 30086
November 1083 1722 -574 1274 509 2996
December 1362 1542 30 1533 1392 3075
January 2733 2042 -614 3139 2119 5181
February 1466 1717 -1085 230 381 1947
March 1956 1209 -889 5306 1067 6515
Source: Reserve Bank of India

15
 9 Foreign exchange reserves

With an increase by USD 5.1 billion during the month, India’s foreign exchange reserves stood at
USD 298 billion in October 2010. On m-o-m basis, the increase in cumulative reserves has been
1.7 percent in October 2010 corresponding to 3.5 percent increase in the previous month (Sept)
.

Table-1.14: Monthly trends in foreign exchange reserves ($ billion)

07-08 % Change 08-09 % Change 09-10 % Change 10-11 % Change

April 204.1 2.5 314.5 1.5 251.7 0.0 279.6 0.2

May 208.3 2.0 312.5 -0.6 262.3 4.2 273.5 -2.2
June 213.4 2.4 312.0 -0.1 265.1 1.0 275.7 0.8
July 229.3 7.4 306.1 -1.8 271.6 2.4 284.2 3.1
August 228.8 -0.2 295.3 -3.5 276.4 1.8 283.1 -0.3
September 247.7 8.2 286.3 -3.0 281.2 1.7 292.9 3.5
October 262.4 5.9 252.8 -11.7 284.3 1.1 298.0 1.7
November 273.5 4.2 247.6 -2.0 288.1 1.3
December 275.9 0.8 255.9 3.3 283.4 -1.6
January 288.3 4.4 248.6 -2.8 280.9 -0.9
February 301.2 4.4 249.2 0.2 278.4 -0.9
March 309.7 2.8 251.7 1.0 279.1 0.3
Source: Reserve Bank of India

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