Published 11:13 IST, July 4th 2019
BUDGET 2019 | Economic Survey tabled in Parliament: 7% GDP predicted in FY2019-20, Key macro takeaways from CEA Krishnamurthy Subramanian here
As the Economic survey was tabled, sources informed that the Financial Year 2019-2020 witnessed a GDP growth at 7.0%
The economic survey projecting the state of health of the country's economy and outlining the challenges has been tabled in the Parliament, a day ahead of the Modi government 2.0's first Budget.The survey that has been prepared by the new Chief Economic Adviser, Krishnamurthy Subramanian, in its headline projection, has pegged India's GDP growth for the ongoing 2019-20 fiscal at 7.0%, alongside a number of other key macro statistics and forecasts.
As mentioned above, the Economic survey was tabled, first in the Rajya Sabha, and projects that GDP growth for the ongoing fiscal will rise to 7.0% versus 6.8% in the fiscal that just ended, meaning that India would remain the fastest-growing major economy in the world. It also termed the macroeconomic condition as 'stable' for the same period, holding that structural reforms of the last few years are continuing to enable growth.
The Economic Survey also outlined that investment rate - likely to be key to what emerges from the Budget on Friday, seems to have bottomed out, with details likely to come to the fore in due course.
Key highlights of the Economic Survey tabled by Finance Minister Nirmala Sitharaman:
- 7% GDP growth predicted in FY20 on stable macroeconomic conditions (vs 6.8% in the fiscal that has just ended)
- January-March slowdown partly because of election-related uncertainty
- Farmers may have produced less in FY19 on food price fall
- NBFC stress reason for FY19 slowdown
- India needs to grow at 8% to become a $5 trillion economy by 2025
- Investment rate seems to have bottomed out, seen higher in FY20 on higher credit growth
- Decline in the non-performing assets (NPAs) should help push the capital expenditure cycle
- Accommodative monetary policy to help cut real lending rates - credit for the RBI
- Government stood by the fiscal consolidation path
- Greenshoots in investment seems to be taking hold
- General fiscal deficit seen at 5.8 percent in FY19 against 6.4 percent in FY18
- Oil prices seen declining
What is in the Economic Survey?
The Economic Survey is a survey that outlines challenges and gives a report of economic performance. The survey document has two parts. One part consists of commentary on the state of the economy, which is released before the Union Budget. The other part carries key economic statistics and data, which is tabled in July or August. This split in the presentation took effect after the Union Budget was moved from the last working day of February to the first day of the month in 2017.The Economic Survey serves as a useful policy document since it also contains policy ideas, key statistics on economic parameters and in-depth research on macro and sectoral trends. Often, the survey serves as a policy guideline for the Union Budget. However, its recommendations are not binding on the government.
Before tabling the economic survey, Chief Economic Adviser Krishnamurthy Subramanian said that he is hopeful and his team has worked with utmost dedication:
"Our team has put in a lot of effort with a lot of dedication, I hope results are good and we are able to contribute to the ideas for the economy. I hope the almighty blesses us," he said.
Visuals of the Economic survey being carried to the Parliament were also seen. This will be the first Budget that will be tabled by the newly appointed Finance Minister Nirmala Sitharaman and comes months after the interim budget presented by Piyush Goyal:
Updated 12:21 IST, July 4th 2019