Current state of Indian Economy

October 2010

Federation of Indian Chambers of Commerce and Industry

New Delhi
Highlights – October 2010

• Indian economy continues to maintain high growth momentum as the real GDP picks up in the
second quarter of the present fiscal. As per the latest estimates released by the CSO, the real
economy expanded by 8.9 percent during the second quarter (July to September) in 2010-11
compared to 8.7 percent during the same period of 2009-10.

The growth in the second quarter shows that India is the second fastest growing economy in the
world after China. China registered a growth of 9.6 per cent during the quarter ending
September.

The most remarkable aspect of Q2 growth is the performance of the farm sector that logged 4.4
percent growth in contrast to 0.9 percent increase during the same period in 2009-10.

Following the robust growth rates in two successive quarters of current fiscal, Ministry of
Finance expects the annual GDP growth not to be less than 8.75 percent for the year 2010-11.

• India’s industrial growth plummeted to a 16-month low of 4.4 per cent in September 2010;
considerably trailing behind the high growth of 8.2 per cent attained during the same month a
year ago. All major components in IIP registered a sluggish increase in output in September vis-
à-vis the growth in September last year. It is expected that the October numbers may go higher
on due to the festive season.

Contraction in capital-goods industry has been the sharpest as the production slumped by 4.2%
in September 2010 following the increase of 2.1 per cent in August 2010. According to industry
analysts, this volatility in capital goods sector was largely attributed to the granularity in the
completion of orders. During the first half of 2010-11, IIP growth in capital goods remained
buoyant at 24.3 per cent partly reflecting a base effect with a low growth of 5.2 per cent during
the same period (April –September) of 2009-10.

In September 2010 the output of twelve out of seventeen industry groups expanded in
percentage terms compared to the increase in output seen in same month of pervious fiscal.

• Growth in six core infrastructure industries dipped to 2.5 per cent in September 2010 as
compared to an increase of 4.3 per cent during the same month of last year. The slackening
pace in the output of six core infrastructure industries was on account of shrinkage in the output
of petroleum refinery and coal sector.

• Core sector growth continued to lag behind the industrial growth. According to RBI, the
prevailing growth trends in core sectors need to be improved, especially in the power
generation sector, for a sustained recovery in industrial growth.

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• A moderation in inflation numbers was observed. While, Inflationary pressure continues in the
case of food items, the build-up in inflation from March end were observed to have fallen
compared to the previous year.

• The stock market opened on an upbeat note in September 2010. The high investment
sentiments were as a result of recovery in the global markets after the fading out of
uncertainties of double dip recession. Both the BSE and NSE indices appreciated by 12.3 per cent
during this month compared to the previous year.

• The growth in money supply (M3) remained subdued during the first half (H1) of 2010-11. This
slow growth was largely associated with deceleration in deposits growth. On the sources side,
the growth of banking credit to the government remained considerably low causing a sluggish
increase in M3.

• Improvements in Central Govt. finances was clearly evident during the first half of 2010-11 as
the revenue receipts increased substantially with the rise in direct and indirect taxs. The gross
tax revenue increased significantly by 25.3 per cent during the period from April to September in
the current fiscal, this is in contrast to sharp decline by 7.6 per cent recorded in 2009-10 (April-
September). The fiscal deficit narrowed in the first half of 2010-11 compared to that of the
previous year.

• India’s total merchandise trade during April-September period of FY11 has been USD 270.1
billion; this was considerably higher than USD 209.1 billion during the same period in FY10. In
the Government‘s assessment, current trends in export growth would likely to achieve the
growth target of close to 15 per cent in 2010-11.

• India’s trade deficit stood at USD 9.1 billion in September 2010 as compared to USD 6.9 billion
during the same month of last year. This was the narrowest trade deficit since the deficit of USD
7.8 billion in March 2010. According to Govt. sources, India's trade deficit could touch USD135
billion for the entire fiscal 2010-11, surpassing the earlier projected figure of USD 120 billion.

• India received record net capital inflows of USD 37.4 billion during the first half (April-
September) of 2010-11. Although this phenomenal increase in capital inflows was nothing new
in most of the emerging Asian economies because of favourable interest rate spreads. Many
countries experienced surplus in their current account balance, however, India’s deficit
continued to remain.

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 Contents

Title Page

1 Industrial Growth 6

2 Core Infrastructure Industries 8

3 Trends in Inflation 9

4 Monetary Indicators 11

5 Stock Market Trends 12

6 Fiscal Management 13

7 Foreign Trade 15

8 Capital Inflows 16

9 Foreign Exchange Reserves 17

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List of Tables and Graphs

Table- 1.1: Growth of Industry: Recent Trends (in percentage) 7

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) 10
Table-1.7: Monetary sector indicators 11
Table-1.8: Monthly trends in stock market indices 12
Table-1.9: Trends in cumulative tax collections of central government (%) 13
Table-1.10: Service Tax 14
Table-1.11: Trends in central government finances: 14
Table-1.12: Monthly trends in growth of merchandize trade (% change) 15
Table-1.13: Monthly trends in foreign investments ($ million) 16
Table-1.14: Monthly trends in foreign exchange reserves ($ billion) 17

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1 Industrial growth

Industrial growth has witnessed further slippage in the month of September 2010, as the growth
of official index of industrial production (IIP) dipped to 4.4 per cent in this month compared to
the growth of 8.2 per cent observed in the same month of previous year.

This turned out to be the lowest IIP growth in the past 16 months of industrial growth statistics
in India. All the major constituents of the IIP namely manufacturing, mining and electricity sector
plummeted significantly corresponding to their robust growth in the same month of 2009. While
manufacturing recorded a growth of 4.5 per cent in September 2010 the growth in September
2009 was 8.3 percent. Mining and electricity grew by 5.2 per cent and 1.7 per cent in September
2010 vis-à-vis the growth rates of 7.4 per cent and 7.5 per cent in the same month of previous
year.

Considering the used based classification, data showed that, capital goods sector observed the
sharpest decline in production and contracted by 4.2 per cent in September 2010 in contrast to
the expansion by 7.9 per cent in the same month of previous year. This sudden drop in capital
goods sector for the second successive month in the current fiscal is symptomatic to the
weakening pace of investment activities in the economy. Besides, the basic and intermediate
goods sector saw a sluggish increase in output as these grew by 3.5 per cent and 10.3 per cent
respectively in September 2010 this is as compared to 5.3 per cent and 10.6 per cent growth in
September 2009.

The moderation in growth was also evident across the consumer goods segments. The increase
in consumer sector output has been subdued at 5.2 per cent in September 2010 corresponding
to a healthy growth of 9.1 per cent in September 2009. However this performance was mainly
driven by the output increase in consumer durables sector that registered 10.9 per cent growth
during this month.

Among the seventeen industry groups are concerned, twelve industries segments confirmed
positive growth in the month of September 2010 as compared to the growth in the
corresponding month of previous fiscal. The much accelerated pace of output growth was
primarily observed in the industry sectors that include ‘Leather and Leather & Fur Products’
(26.8 per cent), ‘Transport Equipment and Parts’ (21.6 per cent) and ‘Rubber, Plastic, Petroleum
and Coal Products’ (13.7 per cent).

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

Weights Sep Sep

2009 2010

Industry 100 8.2 4.4

Mining 10.2 7.4 5.2
Manufacturing 79.4 8.3 4.5
Electricity 10.5 7.5 1.7
Use Based Classification
Basic 35.6 5.3 3.5
Intermediate 26.5 10.6 10.3
Capital 9.3 7.9 -4.2
Consumer Goods 28.7 9.1 5.2
Consumer non Durables 23.3 3.9 2.5
Consumer Durables 5.4 21.9 10.9

Table- 1.2: Growth in 17 Industry sectors

17 industry sectors
Food Products 9.1 -9.3 6.5
Beverages, Tobacco and Related Products 2.4 -2.8 2.2
Cotton Textiles 5.5 6.9 5.5
Wool, Silk and man-made fiber textiles 2.3 10.1 11.7
Jute and other vegetable fiber Textiles (except 0.6 -16.6 0.0
cotton)
Textile Products (including Wearing Apparel) 2.5 6.4 9.4
Wood and Wood Products; Furniture and Fixtures 2.7 -0.6 1.9
Paper & Paper Products and Printing, Publishing & 2.6 -3.0 4.8
Allied Industries
Leather and Leather & Fur Products 1.1 2.3 26.8
Basic Chemicals & Chemical Products (except products 14.0 21.1 -0.5
of Petroleum & Coal)
Rubber, Plastic, Petroleum and Coal Products 5.7 9.9 13.7
Non-Metallic Mineral Products 4.4 14.1 12.9
Basic Metal and Alloy Industries 7.5 1.9 6.1
Metal Products and Parts, except Machinery 2.8 17.1 -2.6
and Equipment
Machinery and Equipment other than Transport 9.6 32.0 -1.8
Equipment
Transport Equipment and Parts 4.0 20.4 21.6
Other Manufacturing Industries 2.5 7.7 -3.1
Source: Central Statistical Organization

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2 Core Infrastructure Industries

Core sectors saw moderation in output performance in September 2010. The six core
infrastructure industries registered an increase of 2.5 per cent during this month. This increase
has been recorded as ‘19 month low growth figure‘. This moderation was due to significant
contraction of industrial output in ‘petroleum refinery’ and ‘coal’ sector that saw a contraction
in growth to 10.2 per cent and 2 per cent respectively in September this year.

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

All Finished steel Cement Crude

infrastructure petroleum
industries
09-10 10-11 09-10 10-11 09-10 10-11 09-10 10-11
April 3.7 5.1 -1.3 4.7 11.9 8.7 -3.1 5.2
May 3.2 5.0 2.8 2.5 11.8 8.6 -4.3 5.8
June 6.3 3.4 3.6 3.5 12.7 3.6 4.0 6.8
July 3.2 3.9 4.0 -0.9 13.8 -0.2 -0.4 15.8
August 6.5 3.7 0.3 7.7 17.6 1.6 -2.6 15.0
September 4.3 2.5 0.8 5.8 6.5 5.2 -0.5 12.5
October 3.8 2.5 5.2 -2.2
November 6.0 11.7 9.0 -1.5
December 6.4 9.6 11.0 1.1
January 9.4 16.2 12.4 9.7
February 4.5 0.9 5.8 4.0
March 7.2 9.2 7.8 3.5
Source: Ministry of Industry

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

Petroleum Coal Power

refinery
09-10 10-11 09-10 10-11 09-10 10-11
April -4.5 5.3 13.2 -2.3 6.7 6.0
May -4.3 7.7 10.4 0.1 3.0 6.4
June -3.8 2.9 15.2 0.9 7.7 3.4
July -14.4 13.7 10.5 4.5 3.8 3.8
August 3.1 -2.3 12.9 1.0 10.2 1.0
September 3.4 -10.2 6.5 -2.0 7.4 1.3
October 7.2 5.0 4.7
November 4.9 4.6 3.3
December 0.8 2.5 6.7
January 3.8 6.0 5.6
February 0.8 6.8 7.3
March 3.3 5.2 6.3

Source: Ministry of Industry

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 3 Inflation

The aggregate inflation stood at 8.6 percent in September 2010 showing marginal increase from
8.5 percent in previous month of this year. Amongst the three broad categories, ‘Fuel & Power’
saw the maximum decline in WPI growth (by 1.4 percentage points) followed by ‘manufactured
products’ (-0.2 percentage points) in September. While the price index of food items and non
food items were seen to increase by 15.7 per cent and 18.3 per cent in September 2010 these
were on the higher side of the increase seen in the August this year.

Inflation numbers based on CPI for industrial workers, agricultural labourers and rural labourers
have moderated to single digit since August 2010 after remaining in double digits for more than
13 months.

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

2009 2010

August Sept August Sept

All Commodities 0.3 1.1 8.5 8.6
I Primary Article 9.8 10.6 15.8 17.5
(A) Food Articles 14.4 13.9 14.6 15.7
(B) Non-Food Articles -1.7 -0.9 16.0 18.2
II Fuel & Power -9.7 -8.1 12.5 11.1
III Manufactured Products -0.3 0.2 4.8 4.6
(A) Food Products 10.7 12.1 3.9 2.8
(B) Beverages, Tobacco & Tobacco 6.4 6.8 6.3 5.9
Products
(C) Textiles 1.1 1.5 9.6 9.7
(D) Wood & Wood Products 8.1 9.5 5.4 3.2
(E) Paper & Paper Products 2.8 2.1 2.0 3.4
(F) Leather & Leather Products 6.0 3.6 -0.1 -0.1
(G) Rubber & Plastic Products -0.3 -1.7 5.0 5.3
(H) Chemicals & Chemical Products -2.6 -2.2 4.1 4.3
(I) Non-Metallic Mineral Products 7.9 8.4 2.6 2.2
(J) Basic Metals Alloys & Metals -13.2 -11.7 7.0 6.0
Products
(K) Machinery & Machine Tools 0.2 -0.7 2.0 2.9
(L) Transport Equipment & Parts 3.0 3.0 3.9 4.2
Source: Reserve Bank of India

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 Table-1.6: Monthly trends in consumer prices (% change)

CPI-IW CPI-UNME CPI-AL CPI-RL

09-10 10-11 09-10 10-11 09-10 10-11 09-10 10-11
April 8.7 13.3 8.8 14.4 9.1 15.0 9.1 15.0
May 8.6 13.9 9.7 14.1 10.2 13.7 10.2 13.7
June 9.3 13.7 9.6 14.1 11.5 13.0 11.3 13.0
July 11.9 11.3 13.0 11.5 12.9 11.0 12.7 11.2
August 11.7 9.9 12.9 10.3 12.9 9.7 12.7 9.7
September 11.6 9.8 12.4 13.2 9.1 13.0 9.3
October 11.5 12.0 13.7 13.5
November 13.5 13.9 15.7 15.7
December 15.0 15.5 17.2 17.0
January 16.2 16.9 17.6 17.4
February 14.9 15.8 16.5 16.5
March 14.9 14.9 15.8 15.5
Source: Ministry of Labor, CMIE

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 4 Monetary Indicators

The broad money supply expanded by 4.9 % during the period of April to September of this year
compared to the growth of 6.8 percent during the same period of 2009-10.

According to RBI, the sluggish growth of M3 is well below its indicative projection of 17.0 % for
the current fiscal which currently ( Sept 2010) running at 14.5 per cent compared to 19 per cent
in the same month of previous year. Further, the slow growth in money supply is significantly
ascribed to the trivial increase in bank deposits especially the long term deposits of banks.

Coming back to the build up from April to September we see that net bank credit flow to
Government grew at 5 per cent which remained one third of 15.1 per cent growth observed
during the same period in 2009-10. The net bank credit to the commercial sector was observed
to grow at 5.2 percent during this period ( Sept over April 2010) compared to the growth of 3.3
percent in last fiscal. Aggregate deposits in banking sector have also increased moderately by
4.8 percent over the period April to September 2010-11 as against the expansion of 7.4 percent
during the same period of previous year. Investments in government and other approved
securities saw slow growth of 6.3 percent during April to September period of 2010-11; marking
a significant reduction from 17.6 percent growth recorded during the same period in 2009-10.

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

Variation in M3 (Rs crore) Variation in M3 (%)

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 391310 8.3 8.2
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

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5 Stock Market Trends

The stock market continued its upward trend in September 2010 . The indices during the month
started on a firm note. As on September 1, 2010, the BSE market index was at 18,205 k level and
gradually peaked up to the level of 20,000 k on October 1, 2010. In NSE index Nifty appreciated
by 12.3% in September 2010 and touched the level of 6143 K with the commencement of
October 2010.

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
17558 2.1 5232 2.1
04.01.10
16356 -6.8 4900 -6.4
01.02.10
16773 2.5 5017 2.4
02.03.10
17693 5.5 5291 5.5
01.04.10
17386 -1.7 5223 -1.3
03.05.10
16572 -4.7 4970 -4.8
01.06.10
17509 5.7 5251 5.7
01.07.10
18081 3.3 5431 3.4
02.08.10
18205 0.7 5471 0.7
01.09.10
20445 12.3 6143 12.3
01.10.10
Source: Reserve Bank of India

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 6 Fiscal Management

With an increase of 33.2%, total government expenditure amounted to Rs 537977 crores during
the period from April to September in 2010-11. On the revenue side, the total receipts went up
from Rs 251073 crores during the April to September peiod of 2009-10 to Rs 404725 crores in
the same period of the current fiscal. This revenue increase saw a growth by more than 60%
during this period in 2010-11 over 2009-10. As a result, fiscal deficit has reduced considerably
from Rs 197775 crores in 2009-10 to Rs 133252 crores in 2010-11.

Growth in tax revenue continued to ride on an upbeat mode in September 2010. The buoyancy
was mainly on account of impressive collection in the area of both direct and indirect taxes.
However, the growth rates in indirect taxes category were observed to be high as compared to
the growth in direct taxes.

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

Gross tax revenue Corporation tax Income tax

09-10 10-11 09-10 10-11 09-10 10-11
April -16.9 27.0 -8.4 23.4 20.0 8.3
May -11.8 22.0 10.1 -1.8 11.7 13.0
June -11.4 28.6 1.8 23.7 7.1 13.8
July -11.1 27.5 4.7 18.4 5.9 15.8
August -11.5 27.3 2.4 18.3 8.1 13.9
September -7.6 25.3 7.7 17.9 7.2 13.6
October -7.5 6.5 10.5
November -7.8 6.6 9.8
December -2.5 16.8 12.2
January -1.2 16.5 13.3
February -1.6 10.9 11.4
March

Customs Excise duties Other taxes

09-10 10-11 09-10 10-11 09-10 10-11
April -52..6 106.4 -114.2 314.1 -5.4 -43.2
May -38.2 56.6 -23.3 49.3 -18.7 -11.7
June -37.3 62.2 -23.7 52.0 -9.5 -36.8
July -34.7 57.4 -26.6 52.0 -3.87 -33.3
August -34.0 59.8 -24.5 43.3 -1.97 -28.9
September -32.9 61.8 -22.9 41.1 -20.5 -30.7
October -31.7 -21.7 -17.2
November -31.2 -20.0 -15.0
December -29.2 -18.2 -24.2
January -25.2 -14.5 -21.8
February -21.8 -10.2 -19.8
March

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Table-1.10: Service Tax

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
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: September 2010

Actual to budget estimates

( in Rs crores)
09-10 10-11
Revenue receipts 244471 398234
Tax revenue 185669 233415
Non tax revenue 58802 164819
Total receipts 251073 404725
Non plan expenditure 322070 368270
On revenue account 301291 328308
On capital account 20779 39962
Plan expenditure 126778 169707
On revenue account 108163 144847
On capital account 18615 24860
Total expenditure 448848 537977
Fiscal deficit 197775 133252

Source: Controller General of Accounts

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7 Foreign Trade

India’s merchandise exports during September 2010 were valued at US$ 18.0 billion and
recorded a growth of 23.2 per cent as compared to the decline by 13.8 per cent in September
2009. India’s merchandise imports during this month registered an increase by 26.1 per cent on
Y-o-Y basis as against severe contraction by 31.3 per cent during September 2009. This increase
was on account of considerable growth in both oil and non oil imports. As a consequence, the
trade deficit has further amplified with an estimated magnitude of USD 62.8 billion during April
to September 2010-11. However, this was much higher than the deficit of USD 47.2 billion
observed during the same period of 2009-10. In the present context, higher divergences in
inflation rates between India and its trading partners created much pressure on India’s
export competitiveness in the international market.

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

Exports Oil imports Non-oil imports Total imports

09-10 10-11 09-10 10-11 09-10 10-11 09-10 10-11
April -33.2 36.2 -58.5 70.5 -24.6 34.3 -36.6 43.3
May -29.2 35.1 -60.6 66.7 -25.4 28.2 -39.2 38.5
June -27.7 30.4 -50.6 26.5 -16.5 21.5 -29.3 23.0
July -28.4 13.2 -55.5 4.4 -24.5 49.6 -37.1 34.3
August -19.4 22.5 -45.5 12.4 -25.5 41.1 -32.4 32.2
September -13.8 23.2 -33.5 14.4 -30.4 31.2 -31.3 26.1
October -6.6 -9.3 -17.2 -15.0
November 18.2 7.3 -5.9 -2.6
December 9.3 42.8 22.4 27.2
January 11.5 56.0 28.8 35.5
February 34.8 97.4 55.6 66.4
March 54.1 85.2 61.0 67.1

Source: Ministry of Commerce

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8 Capital flows

The country saw huge capital inflows during the month of September 2010. The total foreign
investments escalated to USD 12.7 billion in September 2010. This is double the amount of USD
6.5 billion received during the same month of 2009. While the FDI amounted to USD 2.1 billion
in September 2010 as against USD 1.5 billion in the same month of 2009, the level of portfolio
investments stood at USD 10.6 billion during the month corresponding to the level of USD 5.0
billion recorded in September 2009.

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

Foreign direct Portfolio Total foreign

investments investments investments
09-10 10-11 09-10 10-11 09-10 10-11
April 2339 2179 2278 3315 4617 5494
May 2095 2213 5639 41 7734 2254
June 2582 1380 353 1232 2935 2612
July 3476 1785 2077 9114 6508 10899
August 3268 1330 926 -440 4194 890
September 1512 2118 4999 10577 6511 12695
October 2332 2922 5254
November 1722 1274 2996
December 1542 1533 3075
January 2042 3139 5181
February 1717 230 1947
March 1209 5306 6515
Source: Reserve Bank of India

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9 Foreign Exchange Reserves

India’s Foreign exchange reserves swelled by USD 8.5 billion in September this year, the
cumulative reserves stood at USD 291.6 billion vis-a-vis USD 283.1 billion in August 2010. This
increase has been 3% in September 2010 on m-o-m basis. The growth in reserves could be
attributed to the higher capital inflows under the portfolio category throughout the month.

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

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

April 314.5 1.5 251.7 0.0 279.6 0.2

May 312.5 -0.6 262.3 4.2 273.5 -2.2
June 312.0 -0.1 265.1 1.0 275.7 0.8
July 306.1 -1.8 271.6 2.4 284.2 3.1
August 295.3 -3.5 276.4 1.8 283.1 -0.3
September 286.3 -3.0 281.2 1.7 291.6 3.0
October 252.8 -11.7 284.3 1.1
November 247.6 -2.0 288.1 1.3
December 255.9 3.3 283.4 -1.6
January 248.6 -2.8 280.9 -0.9
February 249.2 0.2 278.4 -0.9
March 251.7 1.0 279.1 0.3
Source: Reserve Bank of India

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