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The Economic Survey 2021-22 was tabled in Parliament on Monday by Finance Minister Nirmala Sitharaman soon after the President’s address to both Houses of Parliament. The survey, presented a day before the Union Budget, underlines the state of the economy and outlines suggestions for policy actions.
“India’s GDP is projected to grow in real terms by 8.0-8.5% in 2022-23,” said the Survey. Growth will be supported by “widespread vaccine coverage, gains from supply-side reforms and easing of regulations, robust export growth, and availability of fiscal space to ramp up capital spending,” it added.
Here are the key highlights from the Economic Survey 2022:
- GDP growth rate projected in the range of 8-8.5% for the next fiscal 2022-23 (FY23)
- Growth projections based on oil price projection of $70-75 per barrel next fiscal, against current price of $90
- Agriculture least hit by pandemic, sector to grow by 3.9% in 2021-22 after growing 3.6% the previous year
- Disruptions in the global container market not yet over; will continue to impact the global sea trade.
- Crop diversification towards oilseeds, pulses and horticulture needs to be given priority
- Inflation on everyone’s mind: Eco Survey flags global resurgence of inflation, warns of imported inflation
- The Survey also went into detail on the government’s use of the Barbell approach to
- COVID-19, saying that this “helped make it possible to target the vulnerable sections/businesses better, keeping the pandemic’s economic toll at much less than what could have been”
- Industrial sector likely to grow at 11.8%.
- Survey pegs services sector to see 8.2% growth in 2021-22
- Expenditure on social services rises by 9.8% to Rs 71.61 lakh crore in FY22
- Government consumption is estimated to grow by a strong 7.6% surpassing pre-pandemic levels.
- India’s total exports are expected to grow by 16.5% in 2021-22 surpassing pre-pandemic levels.
- Imports are expected to grow by 29.4% in 2021-22
- Consumption has grown 7% in 2021-22 with a significant chunk of it thanks to government spending.
- Middle-class borrowing to own houses well below the 21.1% growth year-on-year; also below the level of the last four years
- Pandemic, job uncertainty continues to make people wary of EMIs, with home loans registering 8% growth in November 2021, 0.4% below 2020
- Railways: Rs 65,157 crore capital expenditure from April to November 2021; capex outlay in the ongoing financial year is at Rs 2.15 lakh crore, which is five times the 2014 level.
- “Railways capex will increase further in coming years and emerge as an engine of national growth,” the survey says.
- India has third largest startup ecosystem in the world after US and China.
- Delhi saw 5,000 new startups versus 4,514 in Bengaluru between April 2019 and December 2021
- India sees 44 unicorns in 2021, a new record.
- In April-November 2021 Rs 89,066 crore was raised via 75 IPO issues versus 29 companies which raised Rs 14,733 crore in the same period in 2020
- Forex, low current account deficit and capital inflows keeping external sector well supported
- Share of individual investors in total NSE turnover increases to 44.7%
- 221 lakh individual Demat accounts added between April-November 2021
- UPI takes centre stage, with the country seeing 4.6 billion transactions worth Rs 8.26 lakh crore in December 2021 alone
- In April-November 2021, UPI processed more than 24.26 million One Time Mandate create transactions worth Rs 44,381 crore.
- Rs 1.81 lakh crore raised through equity issues
- “Rate transmission has been higher in public sector banks than in private sector banks in the current monetary easing cycle,” says the Survey
- Housing sales expected to see a boost after COVID-19 slump on the back of reduced duties in multiple states
- Five sectors capture around 83% of the aggregate pipeline value: Roads (27%), Railways (25%), Power (15%), Oil & Gas pipelines (8%) and Telecom (6%)
- Government finances to witness consolidation in 2021-22, after uptick in deficit and debt indicators in the previous year
- “Climate finance will remain critical to successful climate action by developing countries, including India,” says the Survey
