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Tag: economic survey announcements

  • Post-Covid financial system won’t merely be re-inflation of pre-Covid financial system: Economic Survey

    It said that supply-chain breakdowns triggered an interruption of the financial system’s supply-side which additionally squeezed demand, however it’s not right to see the pandemic associated financial slowdown as only a demand downside.
    “…the post-Covid economy will not be merely a re-inflation of the pre-Covid economy. Simply building it back with demand measures is not a solution,” it mentioned.

    The emphasis given to the supply-side in India’s COVID-19 response is pushed by two vital issues: first, Indian policymakers noticed the disruptions attributable to travel-restrictions, lockdowns and supply-chain breakdowns as an interruption of the financial system’s supply-side. “Although this also squeezed demand, it is not correct to see the pandemic related economic slowdown as just a demand problem as happens with most economic cycles,” it mentioned. Second, the post-Covid world shall be impacted by all kinds of things – adjustments in expertise, client behaviour, geo-politics, supply-chains, local weather change, it added.

    The Survey has flagged dangers from rising inflation from each a tighter international liquidity situation and trade charge volatility in international foreign money. “In 2021, inflation picked up globally as economic activity revived with the opening up of economies. Inflation in the US touched 6.8 per cent in November 2021, the highest since 1982, driven largely by energy and food prices. As inflation worries are mounting, a distinct shift towards the unwinding of pandemic-led stimulus is taking hold. This may result in tightening of financial conditions, adversely affecting capital flows, putting pressure on exchange rate and slowing down growth in emerging economies,” it mentioned.

    Highlighting the divergence between wholesale and retail inflation, it mentioned imported inflation is an issue and must be taken into consideration. The excessive WPI-based inflation charge in 2021 is essentially attributable to the low base of the previous 12 months, whereas retail inflation that had remained excessive throughout 2020-21 as a result of provide chain disruptions and excessive meals inflation moderated in 2021-22 on account of efficient provide aspect administration, leading to a divergence between WPI and CPI primarily based inflation, it mentioned. “…unanticipated increase in energy prices and emergence of industrial input cost pressure and high freight costs led to a sharp spike in WPI inflation in 2021. This was reflected in high WPI inflation in the fuel group and manufactured sector during the year. Thus, while on the one hand, low food inflation pulled down CPI, on the other hand high energy and input prices pulled up WPI based inflation rate,” it mentioned.

    The Survey additionally said that the stability of dangers for international commerce is tilted to the draw back, with the largest danger from the pandemic, notably with resurgence of recent variants corresponding to Omicron. In addition to the surge in international inflation, longer port delays, increased freight charges, scarcity of transport containers, scarcity of inputs corresponding to semiconductors, with supply-side disruptions being exacerbated by restoration in demand, pose important dangers, inter alia, for international commerce.
     

  • Economic Survey 2022 Live Updates: Economic Survey 2021-22 to be tabled in Parliament right this moment

    Economic Survey 2022 Live Updates: The Budget Session of the Parliament will begin right this moment with President Ram Nath Kovind addressing each the homes. Thereafter Finance Minister Nirmala Sitharaman will desk the Economic Survey 2021-22.
    The Economic Survey is an annual doc ready by the Ministry of Finance beneath the steering of the Chief Economic Advisor (CEA) and it gives a abstract of annual financial improvement throughout the nation in the course of the monetary 12 months 2021-22.
    The authorities on Friday appointed Dr. V Anantha Nageswaran as the brand new CEA including in a press release that he has assumed cost. He changed KV Subramanian whose three-year time period led to December.

  • Economic Survey 2021 Highlights: Govt pegs FY22 GDP progress at 11%, FY21 GDP to contract 7.7%

    Economic Survey 2021 Highlights: The Budget Session of the Parliament started right this moment and Finance Minister Nirmala Sitharaman tabled the Economic Survey 2020-21 within the Lok Sabha. The annual doc by the Ministry of Finance beneath the steerage of Chief Economic Advisor KV Subramanian offers a abstract of annual financial improvement throughout the nation through the monetary 12 months 2020-21.
    According to the doc, the federal government sees the Indian economic system rising at 11 per cent within the monetary 12 months 2021-22 (FY22). However, the GDP progress fee is estimated at minus 7.7 per cent for the continued fiscal.
    “The estimated real GDP growth for FY 2022 at 11 per cent is the highest since independence,” the Economic Survey mentioned.

    Here are the highlights of Economic Survey 2020-21:
    – “Real growth rate for FY21 is taken as -7.7 per cent (MoSPI) and the real growth rate for FY22 is assumed as 11.5 per cent based on IMF estimates,” Economic Survey 2020-21 doc mentioned.
    – The survey projected a V-shaped restoration: While the lockdown resulted in a 23.9 per cent contraction in GDP in Q1, the restoration has been a V-shaped one as seen within the 7.5 per cent decline in Q2 and the restoration throughout all key financial indicators.
    – Despite the hardhitting financial shock created by the worldwide pandemic, India is witnessing a V-shaped restoration with a secure macroeconomic scenario aided by a secure forex, comfy present account, burgeoning foreign exchange reserves, and inspiring indicators within the manufacturing sector output.
    – Together, prospects for strong progress in consumption and funding have been rekindled with the estimated actual GDP progress for FY 2021-22 at 11 per cent.
    – India’s mature coverage response to this “once-in-a-century” disaster thus offers essential classes for democracies to keep away from myopic policymaking and demonstrates the numerous advantages of specializing in long-term good points.
    – India’s actual GDP is projected to document a progress of 11.0 per cent in 2021-22 and nominal GDP by 15.4 per cent.
    – Based on tendencies obtainable for April to November 2020, there’s prone to be fiscal slippage through the 12 months
    – India anticipated to witness present account surplus through the present monetary 12 months after a niche of 17 years
    – India’s sovereign credit score rankings don’t replicate its fundamentals, the Survey says
    – An Asset Quality Review train should be performed instantly after the forbearance is withdrawn.
    – Economic progress has a far higher impression on poverty alleviation than inequality. Therefore, given India’s stage of improvement, India should proceed to give attention to financial progress to raise the poor out of poverty by increasing the general pie, the doc mentioned.
    – Reforms in tax administration have set in movement a strategy of transparency, accountability and extra importantly, enhancing the expertise of a tax-payer with the tax authority, thereby incentivising tax compliance.
    – “This Economic Survey is dedicated to all COVID warriors who upheld India. It also captures the resilience of the Indian economy. Keeping with the times, this year’s Survey is being delivered in e-book format, with an official app for it. Chapter 1 is about India’s policy response to COVID-19 and Saving Lives And Livelihoods amidst a once-in-a-lifetime crisis,” CEA Subramanian mentioned.
    – India’s coverage response to COVID-19 was guided by the belief that GDP progress will come again, however not misplaced human lives. Early intense lockdown saved lives, helped sooner restoration. Both on COVID-19 instances & deaths, India has executed very well, the CEA mentioned.
    – CEA Subramanian introduced an evaluation of efficiency of states in averting COVID instances & deaths: Maharashtra -> beneath performer on each counts. UP, Gujarat, Bihar -> over performers in instances. Kerala, Telangana, AP -> over performers in deaths.

    CEA @SubramanianKri presents an evaluation of efficiency of states in averting #COVID instances & deaths#Maharashtra ➡️ beneath performer on each counts
    UP, Gujarat, Bihar ➡️over performers in instances
    Kerala, Telangana, AP ➡️over performers in deaths#SavingLivesAndLivelihoods pic.twitter.com/znJJMuhLeT
    — PIB in Maharashtra 🇮🇳 (@PIBMumbai) January 29, 2021
     
    – The CEA defined the sturdy correlation of lockdown with the decline in instances & deaths discovered throughout states. “Even without lockdown, COVID-19 would have created a significant economic impact. But lockdown ensured a coordinated response, enabling saving lives and livelihoods,” he mentioned.
    – KV Subramanian mentioned that India was the one nation to announce structural reforms. “India focused on saving lives and livelihoods; took short term pain for long term gain. Recognized that GDP growth will recover, lost human lives cannot be brought back,”

    India – the one nation to announce structural reforms
    India targeted on #SavingLivesAndLivelihoods; took brief time period ache for long run achieve
    Recognized that GDP progress will get well, misplaced human lives can’t be introduced again
    – CEA, on India’s #COVID19 Policy Response pic.twitter.com/4Btl6ANpTB
    — PIB in Maharashtra 🇮🇳 (@PIBMumbai) January 29, 2021
     
    – He mentioned that Economic Survey requires counter-cyclical fiscal coverage to be an essential level of emphasis, the place the federal government steps in when the non-public sector does badly and steps again when the non-public sector does nicely.
    – Is India’s debt sustainable? Subramanian mentioned “Even if India were to have the real GDP growth rate as low as 3.8 per cent from FY23 to FY29, debts will still come down. Economic Survey highlights potential of public investment, especially in a slowdown; calls for fiscal policy to support growth.”