Economic Survey 2014-15: The survey prepared by the finance ministry's chief economic adviser Arvind Subramanian on the state of Indian economy was released ahead of Saturday's Union Budget announcement for 2015-16 fiscal year that begins on April 1. It has highlighted that the Indian economy would grow by more than 8 percent in the 2015-16 fiscal year. Economic survey showed that Indian economy appears to have now gone past the economic slowdown. It indicated that a clear political mandate for reform and a benign external environment now is expected to propel India on to a double digit trajectory. GDP growth is expected to accelerate between 8.1% to 8.5% in 2015-16. Inflation has declined by over 6% since late 2013. Current account deficit has declined from a peak of 6.7% of GDP to an estimated 1% in the coming fiscal year..
Economic Survey 2014-15 Highlights:
Growth
=> 2015-16 GDP growth seen at over 8 pct y/y
=> Double digit economic growth trajectory now a possibility
=> Economic growth at market prices seen between 8.1 - 8.5 percent in 2015-16 on new GDP calculation formula
=> Total stalled projects seen at about 7 percent of GDP, mostly in private sector
Reforms=> There is scope for big bang reforms now
=> India can increase public investments and still hit its borrowing targets
Inflation=> Inflation shows declining trend in 2014-15
=> Inflation likely to be below central bank target by 0.5 - 1 percentage point
=> Lower inflation opens up space for more monetary policy easing
=> Government and central bank need to conclude monetary framework pact to consolidate gains in inflation control
=> Consumer inflation in 2015-16 likely to range between 5-5.5 percent
Fiscal Consolidation=> Govt remains committed to fiscal consolidation
=> India can balance short-term imperative of boosting public investment to revitalize growth with fiscal discipline
=> Outlook for external financing is correspondingly favourable
Current Account Deficit=> Estimated at about 1.3 percent of GDP in 2014-15 and less than 1.0 percent of GDP in 2015-16
=> Double digit economic growth trajectory now a possibility
=> Economic growth at market prices seen between 8.1 - 8.5 percent in 2015-16 on new GDP calculation formula
=> Total stalled projects seen at about 7 percent of GDP, mostly in private sector
Reforms=> There is scope for big bang reforms now
=> India can increase public investments and still hit its borrowing targets
Inflation=> Inflation shows declining trend in 2014-15
=> Inflation likely to be below central bank target by 0.5 - 1 percentage point
=> Lower inflation opens up space for more monetary policy easing
=> Government and central bank need to conclude monetary framework pact to consolidate gains in inflation control
=> Consumer inflation in 2015-16 likely to range between 5-5.5 percent
Fiscal Consolidation=> Govt remains committed to fiscal consolidation
=> India can balance short-term imperative of boosting public investment to revitalize growth with fiscal discipline
=> Outlook for external financing is correspondingly favourable
Current Account Deficit=> Estimated at about 1.3 percent of GDP in 2014-15 and less than 1.0 percent of GDP in 2015-16
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