Aggregate demand conditions stay resilient amid upbeat consumer and business confidence and an uptick in bank credit, while on the supply front, rabi sowing has exceeded last year's level and the normal acreage, it noted.

"On the vaccination front, India has made rapid strides. On the Omicron variant, the recent data from the UK and South Africa suggest that such infections are 66 to 80 per cent less severe, with a lower need for hospitalisation," it said.

Observing that manufacturing and several categories of services remain in expansion, the article said, "overall economic activity in India remains strong, with upbeat consumer and business confidence and upticks in several incoming high frequency indicators".

There are indications that supply chain disruptions and shipping costs are slowly easing, although the waning of inflation may take longer. This provides a window of opportunity to focus all energies on accelerating and broadening the global recovery, the article said.

It also said that data for early January 2022 (up to January 12) indicate growth in digital payments, although the recent surge in infections ‘may pose a concern going forward’. Nevertheless, the payment industry is expected to display resilience owing to availability of varied checkout options and rising digital.

Fibre2Fashion News Desk (DS)