Concerns About Inflation Persist as Pricing Pressures Extend Beyond Food
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Why in news?
Due to the general election early in June and the subsequent establishment of a new government at the Center, state spending on public works continued to have a significant negative impact on production in India's eight primary infrastructure sectors. The country's northern and western regions saw heatwaves in May and June that had a significant negative influence on many economic activities, contributing to the general decline in industrial production.
Data on the Index of Eight Core Industries
The Commerce and Industry Ministry released preliminary data on the Index of Eight Core Industries (ICI) on July 31. The data indicates that the output of five of the sectors experienced either significant slowdowns in growth or contractions from the previous year. As a result, the overall growth of the core sector slowed to 4%, a 20-month low. Power generation fell 3.6% from May's record high level, while the output of refinery products—which, at 28%, has the biggest weight on the ICI—contracted year over year for the first time in five months.
Monsoon impact :
The commencement of the monsoon rains in certain regions of the nation contributed to a reduction in the YoY expansion of the crucial electricity sector, which has the second-heaviest weight of around 20%. The pace of growth virtually halved to 7.7% from May's 13.7%. But June's crippling heatwaves, which the India Meteorological Department estimated to be at a 14-year high, reduced demand for steel as building projects found it difficult to resume in the sweltering heat. After a 6.8% pace in May, steel output fell 4% from the previous month, bringing down the year-over-year rise to just 2.7%. The bright spot was coal, as output growth jumped from 10.2% in May to 14.8% in June.
The most recent HSBC India Manufacturing Purchasing Managers' Index (PMI), which is based on private surveys, suggests that manufacturing activity overall decreased somewhat in July. According to a poll conducted by S&P Global among purchasing managers at around 400 firms, the PMI in July eased to 58.1 from 58.3 in June due to somewhat lower gains in new orders and output. The genuinely unsettling conclusion of the PMI survey, however, goes beyond the slight slowdown in manufacturing activity. It indicates that firms have been raising selling prices at the sharpest rate in over 11 years due to a notable increase of input costs.
Goods makers report having to pay more for steel, coal, paper, rubber, and packaging. This means that the outlook for overall inflation, both at the wholesale and retail levels, is not encouraging. The Monetary Policy Committee of the Reserve Bank of India has a tough job ahead of it when it convenes this week to discuss its interest rate position. In the fight to control inflation, officials cannot afford to let their guard down given the evident indications that price pressures are extending beyond food.]
Kerala requests that the Center label landslides as a "national disaster."
Why in news?
The Center has been asked by the Kerala government to designate the Wayanad landslide, which destroyed at least three villages, as a national catastrophe.
Union Minister of State for Tourism visit
Union Minister of State for Tourism Suresh Gopi stated that the Center was considering the legality of the demand and had to follow a number of procedures.
He said the Kerala government has been asked to submit a report to the Center. He asked the State to ask the Center to release additional support.
According to officials, the Union government would be able to allocate more funds for recovery and climate change mitigation initiatives, such as moving communities residing in disaster-prone areas, if the landslide were officially declared a natural disaster. A national catastrophe tag was also demanded by V.D. Satheeshan, the Leader of the Opposition in the Kerala Assembly.
Landslide impacts
The official death toll, according to the State administration, is 221. Given that over 200 people have gone missing and that rescuers have been recovering bodies and severed body parts, it may increase. At least 9,000 victims of the accident have taken up residence in relief camps managed by the government.
The State administration has disclosed intentions to build a community for those who survived the catastrophe.
