Budget session LIVE: CEA predicts achhe din in 2019, lists govt’s successes

Economic Survey 2018 is a flagship annual document of the Finance Ministry that reviews the overall state of the economy

Live Budget 2018 : The Economic Survey 2017-18, tabled in Parliament on Monday, forecasts gross domestic product growth for 2018-19 at 7-7.5 per cent, compared with a forecast of 6.75 per cent in the current fiscal year.

“A series of major reforms undertaken over the past year will allow real GDP growth to reach 6.75 percent this fiscal and will rise to 7.0 to 7.5 per cent in 2018-19, thereby re-instating India as the world‘s fastest growing major economy,” an official statement said, after the tabling of the survey, adding that “the reform measures undertaken in 2017-18 can be strengthened further in 2018-19.

The survey said that due to the launch of ‘transformational’ Goods and Services Tax (GST), resolution of the long-festering Twin Balance Sheet (TBS) problem by sending the major stressed companies for resolution under the new Indian Bankruptcy Code, implementing a major recapitalization package to strengthen the public sector banks, further liberalisation of FDI and the export uplift from the global recovery, the economy began to accelerate in the second half of the year.

In a highlighted box titled “Ten New Facts on the Indian Economy”, the survey stated that there was a large increase in registered direct and indirect tax payers due to demonetization and GST respectively, and that formal non-agricultural payroll was much greater than earlier anticipated.

What is Economic Survey?

It is a flagship annual document of the Finance Ministry. It reviews the overall state of the economy in the last 12 months. In August last year, however, the government for the first time presented a mid-term economic survey.

Arvind Subramanian

States and urban and rural local governments collect low levels of direct taxes even relative to the powers they already have. Does this imply a low-equilibrium accountability-delivery trap?

  • India’s states and third-tier institutions (urban and rural local governments) collect a lower share of revenue by way of direct taxes than their counterparts in other federal countries.
  • If you look over the last 50-60 years of India, we have moved from “crony socialism” to “stigmatized capitalism”: CEA

Arvind Subramanian

India is in the midst of simultaneous slump in investment and saving rates post GFC. Investment went up 9.1 percentage points in 4 years during mid 2000s and has declined by about 6.3 percentage points in 8 years since GFC.

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