Economic Survey Predicts India’ growth between 6 & 6.5% in 2020-21

The Economic Survey for 2019-20 tabled by the Union Minister for Finance & Corporate Affairs  Nirmala Sitharaman in Parliament on January 31 is confident that India’s GDP growth will be between 6 and 6.5 per cent during the Financial Year commencing from April 1 ending in March 2021. The survey has drawn the connection between the invisible hand of the market, the hand of the trust and how it can contribute to India’s target of becoming a $5 trillion economy. The Economic Survey has stated that the access to Nutrition and Electricity resulted in higher growth rate in India’s Gross Domestic Product (GDP) and new firm creation in Service Sector is far greater than that in Manufacturing, Infrastructure or Agriculture. Saying that the GDP growth is critical variable for decision-making by investors as well as policymakers, the Economic Survey highlighted the recent debate on whether India’s GDP is correctly estimated following the revision in estimation methodology in 2011 is extremely significant. The Survey carefully examined the evidence, leveraging existing scholarly literature and econometric methods to study whether India’s GDP growth is higher than it would have been and concluded that using careful statistical and econometric analysis, it finds no evidence of miss-estimation of India’s GDP growth. The survey highlighted the need to invest in ramping up India’s statistical infrastructure is undoubted. It also said that India has made impressive improvements in several social development indicators. Consumer Price Index (CPI) inflation has increased from 3.7 per cent in 2018-19 (April to December 2018) to 4.1 per cent in 2019-20 for the corresponding period. Wholesale Price Index (WPI) inflation has seen an increase between 2015-16 and 2018-19. It, however, fell from 4.7 per cent in 2018-19 (April to December 2018) to 1.5 per cent during 2019-20 in the same period. Ahead of the Economic Survey was made public, Indian rupee appreciated by 17 paise to 71.41 against the US dollar in early trade on Friday.  he annual economic survey, prepared by a team headed by the Chief Economic Adviser Krishnamurthy Subramanian, also stressed on the need to relax fiscal deficit for the current fiscal to revive growth.It also called for more reforms for making it easier to do business in the country. The survey observed that there an urgent need to remove the red tape at ports to promote exports apart from eliminating other business hindrances such as registering property, paying taxes and enforcing contracts. Ahead of the Budget Session, PM Modi said, “Our government’s identity has been of empowering Dalits, women, those who face exploitation; want to continue efforts. I want a vast, qualitative discussion on the economy in both houses. We should make sure that in this session, we lay a strong foundation for this decade,” PM Modi said. “Let this session focus upon maximum possible economic issues and the way by which India can take advantage of the global economic scenario. Strengthening its economic activities, India should get the maximum benefits of the global conditions. Our government has been identified with the empowerment of the oppressed, the exploited, the deprived classes and women. We will be focussing upon the same in this decade too,” PM Modi said. (edited by PK Chakravarty)