(17 July 2023) Government Data Roundup: Reports By RBI, MoE, MoSPI, Among Those Released Recently

The 33rd edition of the fortnightly roundup of government data covers the Performance Grading Index (PGI) by the Ministry of Education, the Financial Stability Report (FSR) by RBI and Report of the Inter-Departmental Group (IDG) on the internationalization of INR by RBI.

In this 33^rd  edition of fortnightly government data roundup, we look at the Performance Grading Index (PGI) by the Ministry of Education, the Financial Stability Report (FSR) by RBI, and the Report of the Inter-Departmental Group (IDG) on the internationalization of INR by RBI.

Among the monthly reports, CPI for Urban, Rural, and Combined, and Index of Industrial Production were released. The explainer on key price indices can be read here. 

Key statistics from these reports are as below.

• The All-India CPI-Rural for May 2023 stood at 179.8 points and for urban, it stood at 178.2. For June 2023, the provisional index for rural and urban stood at 181.8 and 179.9 respectively. These represent an increase compared to the June 2022 values, which stood at 173.6 and 171.4 respectively for rural and urban areas. The combined provisional CPI for June 2023 stood at 180.9 as compared to 172.6 in June 2022.
• For the month of May 2023, the Index of Industrial Production (IIP) with base 2011-12 stood at 145.0. The Indices of Industrial Production for the Mining, Manufacturing, and Electricity sectors for the month of May 2023 stand at 128.1, 142.3, and 201.6 respectively. The IIP for these sectors during May 2022 stood at 120.4, 134.6, and 199.9 respectively. The mining sector grew higher, followed by Manufacturing and Electricity during this period.

Performance Grading Index (PGI-D)

Brief about the report:

The Performance Grading Index for Districts (PGI-D), released by the Department of School Education and Literacy (DoSE&L), Ministry of Education, evaluates the effectiveness of the school education system at the District level by developing an index for thorough analysis.

This Report is based on data that the districts voluntarily uploaded in a reference year. The PGI-D structure includes 83 indicators with a combined weight of 600 points that are arranged into 6 categories: outcomes, effective classroom transactions, infrastructure facilities and student entitlements, school safety & child protection, digital learning, and governance process.

PGI-D assigns each district one of 10 grades, with Daksh—the highest grade being awarded to districts that receive more than 90% of the total points in a category or overall. Akanshi-3, which is for scores up to 10% of the total points, is the lowest grade in PGI-D.

Key findings of the report:

• A total of 748 districts were covered during 2021-22 and 742 districts in 2020-21.
• None of the districts attained the top two grades viz., Daksh and Utkarsh during 2020-21 & 2021-22. 
• Year-wise performance analysis of districts reveals that 79 districts made consistent improvement in PGI-D scores in the last 4 years viz., 2018-19 to 2021-22, whereas 25 districts consistently performed poorly during the same period. 
• Overall, 194 districts have made grade level improvements in 2021-22 as compared to 2018-19. Of these 194, 7 districts had the highest performance securing 3-grade jumps in 2021-22 as compared to 2018-19, 23 districts improved their performance by securing an upward shift of two grades in 2021-22, 164 districts improved their grade by one level in 2021-22. 
• A total of 375 districts remained in the same grade and the performance of the remaining 158 districts deteriorated during 2021-22 compared to 2018-19.
• Despite the COVID-19 pandemic in 2021-22, 290 districts have made notable improvements in their performance when compared to 2019-20 (pre-pandemic) with 2021-22.

Financial Stability Report 2023

Brief about the report:

The Financial Stability Report (FSR) is a half-yearly publication with contributions from all the financial sector regulators. The FSR summarizes the findings of the Sub Committee of the Financial Stability and Development Council’s evaluation of current and potential vulnerabilities to the Indian financial system.

Key highlights of the report:

• The capital-to-risk-weighted assets ratio (CRAR) and the common equity tier 1 (CET1) capital ratio of scheduled commercial banks (SCBs) reached historical highs of 17.1% and 13.9%, respectively, in March 2023.
• Though the share of SCBs in bilateral exposures in the Indian financial system had declined, they still have the largest bilateral exposure.
• The gross non-performing assets (GNPA) ratio and net non-performing assets (NNPA) ratio for SCBs both continued their downward trends in March 2023, reaching 10-year lows of 3.9% and 1.0%, respectively.
• In March 2023, the CRAR for urban cooperative banks (UCBs) increased to 16.5%, while it was 27.5% for NBFCs.
• The most recent Reserve Bank Systemic Risk Survey, conducted in May 2023, revealed that risk has decreased across many factors that influence domestic systemic risk.
• The profit after tax of SCBs registered a growth of 34.3% in 2022-23. This is due to strong growth in net interest income and a significant reduction in provisions.
• Stress tests for SCBs reveal that they are well-capitalized, and all banks are adequately strong to be able to comply with minimum capital requirements even under adverse stress.

Report of Inter-Departmental Group (IDG) on Internationalization of INR

Brief about the report:

This report is drafted against the backdrop of India’s rising importance in the global economic landscape and, consequently, the potential for the Indian Rupee (INR) to emerge as an international currency. The Inter-departmental Group is tasked to review the extant position of INR as an international currency and to frame a road map for the internationalization of INR.

Key highlights:

The Group recognizes that the internationalization of INR is a process rather than an event, and thus to enable, track and monitor the progress, certain milestones for implementation have been recommended.

Short-term goals:

• It is suggested to adopt a standardized approach or template for Central Bank currency swaps (INR/FCY) and multilateral/bilateral trade arrangements. The main purpose of this standardized approach is to determine the terms of trade with the counterpart country, identifying which country will accumulate balances in the other’s currency and how the surplus can be utilized for the mutual benefit of all participating countries.
• The Inter-Departmental Group (IDG) proposes that the Liquidity Coverage Ratio (LCR) framework should be examined after analyzing the terms of trade with the counterpart country. It is recommended to ensure sufficient availability of Indian Rupee (INR) liquidity in both international and domestic banking sectors.
• To strengthen financial markets, several measures are suggested, including the establishment of a global 24×5 INR market, integration of onshore and offshore forex markets, adding Indian Government Bonds to global bond indices, harmonizing Know Your Customer (KYC) requirements, and integrating onshore and offshore forex markets.

Medium-term goals:

• Among the medium-term goals, are the liberalization of masala bonds, the inclusion of INR in the Continuous Linked Settlement (CLS) system, Expanding the RTGS system for settling international transactions, and providing Banking Services in INR through offshore branches of Indian banks.

Long-term goals:

• Among the long-term goals with a horizon of 5 years and above, the IDG recommends measures to ensure the Inclusion of INR in the SDR basket.