The Economic Survey, the basis for Arun Jaitley's budget for the fiscal year starting April 1, projected India to grow 8 percent in the next couple of years. The survey was prepared by the finance ministry's chief economic adviser Arvind Subramanian. Following are the highlights of Economic Survey 2015-16.
Key Points to Remember
- GDP growth rate for 2015-16 to be in the range of 7% to 7.75 %
- Fiscal deficit of 3.9 pc achievable
- Inflation rate pegged at 4.5 to 5 pc
- Current account deficit seen around 1-1.5% of GDP
Highlights of the survey
- India haven of stability amidst gloomy global landscape.
- Crude oil prices to be about USD 35 a barrel next fiscal, as against USD 45 this year.
- Low inflation takes hold, price stability has increased.
- Pay Commission implementation not to destabilise prices.
- Challenging external environment to cast shadow on economic policies.
- Subsidy bill to be below 2% of GDP next fiscal.
- Concerned over delay in GST Bill.
- Balance sheets of corporate, banks remain stressed; need 4Rs: Recognition, Recapitalisation, Resolution and Reform.
- Suggests revival of domestic demand as foreign capital outflow likely.
- Sees good performance by industrial, infrastructure, corporate sectors due to recent reform.
- More investment in health, education; focus on agriculture.
- Government tax revenues to be higher than budgeted.
- Exports slowdown to continue; pick up in next fiscal.
- India should resist protectionist measures in trade.
- Suggests reform package for fertiliser sector.
- GDP growth next fiscal to be between 7-7.75%
- Current account deficit at 1-1.5%, forex reserves at USD 351.5 bn in mid-Feb.
- PSU banks’ capital need at Rs 1.8 lakh crore by FY19.
- 3.9% fiscal deficit target achievable this year, coming year to be challenging.
- Proposes widening of tax net from 5.5% of earning individuals to more than 20%
- Services sector growth in 2015-16 seen at 9.2%
- Projects retail inflation at 4.5-5% for 2016-17.
- Growth this fiscal to be 7.6%, long-term potential at 8-10% if exports grow rapidly.