Nirmala Sitharaman, Union Minister for Finance and Corporate Affairs, Government of India, tabled the Economic Survey 2019-20 in the Parliament today. The survey states that India’s GDP growth for 2019-20 would be recorded at 5 percent. This suggests an uptick in GDP growth in the second half of 2019-20.
The survey also said that the deceleration in GDP growth can be understood within the framework of a slowing cycle of growth. The financial sector has acted as a drag on the real sector.
The Survey says that the uptick in second half of 2019-20 would be mainly due to ten positive factors like picking up of NIFTY for the first time this year, an upbeat secondary market, higher FDI flows, build-up of demand pressure, positive outlook for rural consumption, rebound of industrial activity, steady improvement in manufacturing, growth in merchandize exports, higher build-up of foreign exchange reserves and positive growth rate of GST revenue collection.
The Survey says, on a net assessment of both the downside/upside risks, India’s GDP growth is expected to grow in the range of 6.0 to 6.5 percent in 2020-21 and it asks the Government to use its strong mandate to deliver expeditiously on reforms, which will enable the economy to strongly rebound in 2020-21, said a PIB release.
Some of the other highlights as announced by KV Subramanian, Chief Economic Adviser, are as follows:
- For 5 trillion economy, India should strengthen the invisible hand of markets together with the hand of trust that can support markets, in line with the economic model advocated in our traditional thinking.
- The Economic Survey2020 introduces the idea of “trust as a public good that gets enhanced with greater use”. Policies must empower transparency and effective enforcement using data and technology to enhance this public good.
- Economic Survey2020 shows: a) Exponential rise in India’s GDP and GDP per capita post liberalization coincides with wealth generation in the stock market b) Liberalized sectors grew faster than those that remain closed.
- Pro-business policies to strengthen the invisible hand: (a) equal opportunities for new entrants, fair competition and ease of doing business (b) eliminate government interventions that undermine markets, (c) enable trade for job creation and (d) efficiently scale up the banking sector to be proportionate to the size of the Indian economy.