Top Economic News: Slow Economic Growth & Developments on 2000 Rs Note

India's economy continues to navigate a dynamic landscape shaped by domestic growth, evolving global conditions, and strategic government initiatives. In today’s roundup, we bring you insights into the finance ministry’s outlook, new policy measures, updates on labour codes, and economic forecasts. From workforce growth projections to the status of Rs 2,000 notes, here’s a comprehensive overview of the latest developments in India’s economic sphere.

Top Economy News

India’s Economic Outlook Remains ‘Cautiously Optimistic’

The Ministry of Finance has expressed a cautiously optimistic view of India's economic prospects for the coming months, highlighting factors such as domestic growth, global interest rates, and upcoming policy decisions in the United States as critical determinants. The ministry’s October economic review revealed that high-frequency indicators for rural and urban demand have rebounded after a brief slowdown during the monsoon season, even as global uncertainties persist.

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Cabinet Approves Major Developmental Initiatives

In a significant boost to various sectors, the Union Cabinet approved several initiatives focusing on agriculture, innovation, education, energy, and infrastructure. These decisions, announced by Union Minister Ashwini Vaishnaw, aim to foster sustainable development, enhance entrepreneurship, and improve access to essential resources across the nation.

Labour Code Updates: Draft Rules Still Pending in Five States

Five states are yet to pre-publish draft rules under three key labour codes concerning Industrial Relations, Social Security, and Occupational Safety. Additionally, four states or Union Territories have not released draft rules for the Code on Wages, 2019. Labour Minister Shobha Karandlaje clarified in the Lok Sabha that rule-making authority under these codes is shared between the central and state governments, reflecting the subject’s presence in the Concurrent List of the Constitution.

Manufacturing Sector Incentives Linked to Jobs and Capex Under Discussion

As preparations for the FY26 Budget gather pace, the government is deliberating on new incentives to revitalize the manufacturing sector. These proposed measures will link government assistance to employment generation and capital expenditure, marking a shift toward broader support for manufacturing investments.

Economic Growth Slows in Q2

India’s economic growth is estimated to have slowed to 6.5% in the second quarter, compared to 8.1% in the same period last year and 6.7% in the previous quarter. Economists attribute the slowdown to weaker urban consumption, muted government spending, and the adverse impact of heavy rainfall on mining and electricity. The official figures are set to be announced on November 29.

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S&P Global Lowers India’s Growth Forecast

S&P Global Ratings has revised India’s GDP growth forecast downward to 6.7% for FY26 and 6.8% for FY27, citing high interest rates and reduced fiscal stimulus as factors tempering urban demand. The forecast reflects a slight decline from previous estimates of 6.9% and 7%, respectively.

Workforce Growth Driven by Logistics and E-Commerce

A report by TeamLease Services predicts a 7.1% workforce growth for the second half of FY25, driven by logistics, e-commerce, and manufacturing sectors. With 59% of employers planning to increase headcount, the period October-March is expected to see significant hiring activity.

Rs 2,000 Notes Largely Withdrawn

Over 98% of Rs 2,000 currency notes have returned to the Reserve Bank of India (RBI) since their withdrawal was announced in May last year. Of the Rs 3.55 lakh crore worth of notes in circulation as of May 19, Rs 3.48 lakh crore had been deposited by November 1, according to the Minister of State for Finance, Pankaj Chaudhary.

Mahila Samman Savings Scheme Gains Traction

The Mahila Samman Savings Certificate Scheme, launched in April last year, has garnered 4.33 million depositors nationwide. Maharashtra leads with 746,223 accounts, followed by Tamil Nadu and Odisha. The scheme aims to empower women through accessible small savings initiatives.

Microfinance Sector Adopts Stricter Lending Norms

The Microfinance Institutions Network (MFIN) has introduced tighter lending norms to address ongoing asset quality challenges. These measures are designed to reduce over-indebtedness among low-income borrowers while ensuring sustainable credit delivery.

Government Likely to Moderate Capex Outlay Growth

To maintain fiscal discipline, the government may opt for a modest increase in capital expenditure in the FY26 Budget. The move aims to balance economic stimulus with fiscal prudence amidst ongoing efforts to consolidate the fiscal deficit.

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