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.”