After a listless, colourless and spiritless Diwali last year at the end of Vikram Samvat 2076, India is getting ready to celebrate the festival of lights with the usual fervour this year, what with the impact of the Covid-19 pandemic waning. Last year, people were in no mood to celebrate the festival on account of the pandemic and the resultant lockdowns, loss of jobs, a sharp drop in incomes and a coronavirus that brought sickness and deaths to thousands of Indians.

But things have now started changing ahead of the festivities, with people renovating and decorating their homes, shopping for new clothes and buying necessities and luxuries like electronic items and kitchenware. Markets and shopping malls are bustling as in pre-Covid times. Though the pandemic has not totally disappeared from the scene, people are in a festive mood once again, eagerly awaiting the festival of lights.

On the financial front also, the sentiment is cheerful as the economy has started reviving from the depression caused by the pandemic. Investors are jubilant as stock markets are in a bullish frame of mind and the process of economic recovery is well supported by the surge in corporate profits. Business activity is picking up steadily as Diwali and its preceding weeks are traditionally a period of consumption and investment in India. Consumers are relishing the though of buying textiles, automobiles, consumer durables, electronic goods, jewellery, real estate and food items. Such is the mood that one can almost smell the aroma of sweets and other savouries that are traditionally associated with Diwali!

As if to support the people’s growing confidence, the economy is showing good signs of recovery. Last year, there was a de-growth of 7.5 per cent. But if indications for the current year available so far are any guide, the economy will grow at a rate of 8.3 per cent, according to the World Bank. At the same time, the Reserve Bank, the central bank of country, has retained the GDP outlook at 9.5 per cent for fiscal year 2021-22.

Again, as per the data from the Department of Economic Affairs, foreign exchange reserves in India have reached the $ 633.5-billion mark, a new record high. With an improvement in the economic scenario, there have been investments across various sectors of the economy. The private equity venture capital sector recorded investments worth $ 10.7 billion across 137 deals by August 2021, registering a 5-fold yoy growth.

The situation has improved on the export front also, with the country’s merchandise exports in the first five months of the current fiscal year amounting to $ 164.10 billion, recording a spurt of 67.33 per cent yoy. FDI investments are also on the rise, while FPIs also invested a much higher amount this year.

No doubt, the government has taken several steps to aid the economic recovery process and momentum. The Union budget also aimed at encouraging the economy through a combination of short-term, medium-term and long-term measures. In order to boost the economy, the Finance Minister raised the capital expenditure by 34.5 per cent at Rs 5.5 lakh crore. Interestingly, the increased government expenditure has started attracting private investments, with the Production-Linked Incentive scheme providing excellent opportunities. The PLI scheme for textiles and automobiles, among others, is expected to give a boost to the economy.

However it must be noted that the pandemic has administered a severe blow to small and medium-scale industries and several establishments have closed down or are on the verge of closure. There is an urgent need for an intensive stimulus to save these units which can provide employment to hundreds of thousands.