Data recap: Informal sector jobs, India-Russia trade, high inflation

A new government survey shows jobs in the informal sector have declined in the past seven years. Meanwhile, India and Russia have agreed to boost trade between them to $100 billion by 2030.

Shrinking job market

Unemployment is one of the biggest issues India faces, and a new survey released by the government reveals a worrying trend in the informal sector. The sector employed 111.3 million workers in 2015-16, but just 109.6 million in 2022-23, mainly due a decline in the manufacturing sector, a Mint analysis of the Annual Survey of Unincorporated Sector Enterprises survey showed. However, employment in 2022-23 was higher than the 97.9 million recorded in the previous year.

India-Russia trade ties

India and Russia agreed to increase the bilateral trade to more than $100 billion by 2030 during the 22nd Annual Bilateral Summit. The two nations hope to achieve this by increasing cooperation in energy, infrastructure and agriculture, among other sectors. Since the outbreak of the Russia-Ukraine war, India has increased its oil import from Russia. Imports jumped to $61.4 billion in 2023-24 from just $9.9 billion in 2021-22. India’s trade value with Russia stood at $65.7 billion in FY24, with exports at just about 7% of imports.

Mutual fund inflows surge

17%: That’s the increase in equity mutual fund investments from May to June. Investments in equity mutual funds in June stood at ₹40,608 crore, while assets under management (AUM) of equity mutual funds was around ₹27.68 trillion. The contribution of systematic investment plans (SIPs) came in at an all-time high of ₹21,262.22 crore, against ₹20,904.37 crore in May.

Another MGNREGS miss?

Despite the BJP losing popularity in rural areas, the government is unlikely to change ₹86,000 crore outlay for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) announced in the interim budget, Mint reported. However, the government is open to increasing the sum later in the year if required. A look at the previous allocation figures shows the government’s actual spending on the scheme has consistently overshot the budget.

Streaming platforms embrace ads

After offering high-quality content through subscriptions, Netflix and Amazon are turning to advertisement-supported plan as their revenues have declined significantly. Netflix launched an ad-supported plan in November 2022 and recently decided to axe its cheapest ad-free plan in the UK and Canada. Amazon has also turned on advertisements for all Prime Video users, asking them to upgrade for an ad-free experience. This comes at a time when digital video ad spending in the US has more than doubled, an analysis by howindialives.com showed.

A growing appetite for dining out

₹7.76 trillion: That’s the estimated size of India’s food services sector by 2028, up from ₹5.69 trillion in 2024, according to a report by National Restaurant Association of India and Kantar, a market research agency. This would translate into a compounded average growth rate of 8.1%. The sector includes catering and delivery services. Millennials and GenZ, who are dining out more often than ever, will driver the industry’s growth.

Cut GST, not income tax, experts say

While Indians are looking for income tax relief the upcoming Budget, experts believe a GST cut is be the right way to boost India’s consumption, a Mint analysis showed. While income-tax cuts could be a quick fix, they would benefit only a small part of the population. And since 45% of the 1,455 goods still attract 18% GST, there is scope to reduce the indirect tax for the benefit of all Indians.

Chart of the week: More price pain

India’s retail inflation is expected to rise for the first time in six months owing to a 4.9% rise in the cost of vegetables in June from 4.75% the previous month, a Mint poll showed. If today’s inflation data comes in as expected, it will be the highest in four months.