Several High Frequency Indicators of Economy Show Muted Growth, Local Car Sales Continue to Decline
The Wire Staff
New Delhi: Several high frequency indicators of the Indian economy such as goods and services tax (GST), UPI transactions, diesel consumption and car sales are showing muted growth or a contraction from a year earlier, indicating that the economy has hit a soft patch in June.
June saw GST collections expanding at the slowest in the last 50 months at 6.2%. Similarly, UPI too witnessed a decline in both transaction volume and value in June from May, reported Economic Times.
“Around 6% growth in GST collections, coupled with less than 4% growth in advance tax collection for first quarter of FY26 does indicate softening of demand and cautious outlook,” Pratik Jain, partner, Price Waterhouse & Co LLP, told the newspaper.
Earlier, sales of air conditioners and refrigerators had dropped sharply in the April-June quarter in the wake of milder-than-expected summer temperatures.
Meanwhile, local car sales continued to decline for the second consecutive month by around 6% in June. Leading car manufacturers including Maruti Suzuki, Hyundai Motor India and Tata Motors posted double-digit decline in sales, reported ET.
While 3,20,000 cars, sedans and utility vehicles were sold in June 2025, the figure was higher in June 2024 with 3,42,000 units sold.
“The slowdown in passenger vehicle sales is largely due to a sharp decline in the smaller segment cars. Historically, passenger vehicle sales used to grow at 1.5 times the GDP growth. But now even after 6.5% GDP growth, the car market is nearly flattish. This is because the once-mass small car segment is not participating in the growth at all. This is clearly an affordability issue,” Rahul Bharti, senior executive officer, corporate affairs at Maruti Suzuki, told the newspaper.
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