Economic Survey 2020 Highlights: Thalinomics, 6.5% GDP projection, Wealth Creation dominate key findings

Finance Minister Nirmala Sitharaman has formally tabled the Economic Survey 2019-20 report in the Parliament. Following the presentation of Economic Survey, both the houses were  till tomorrow.

Economic Survey 2019-20 has been released by the Finance Ministry with Lavender Colour cover page. The lavender cover captures the new rupee and signifies a synthesis of old & new.

Among the key projections that the Economic Survey makes ahead of the Union Budget; the key most important ones are GDP Growth, Industrial Sector Growth and Agricultural Sector Growth. The same is listed below:

One of the key observations that the Economic Survey 2019-20 has projected is the dip in growth due to the dwindling investments. To overcome this, with an aim to spur growth back in the Indian Economy, the survey has recommended relaxation of fiscal deficit target in the next financial year.

India’s balance of payment position is expected to strengthen further in FY21 with the forex reserves showing a healthy growth to USD 461.2 Billion. The growth of Forex Reserves has been triggered by FDI inflows and Overseas Remittances. Consequently, India will see its Current Account Deficit decline further.

The central theme of Economic Survey 2019-20 released today is “Enable Markets, Promote 'Pro-Business' Policies and Strengthen 'Trust' in the Economy.” The key focus of the survey is towards triggering Wealth Creation and aimed at laying the foundation or building the pathway towards making India a USD 5 Trillion Economy.

Economic Survey has recommended an aggressive target for disinvestment of the Central Public Sector Enterprises. The decision is intended to bring higher profitability and promote efficiency in the operations Public Sector Units. Furthermore, disinvestment will also bring in higher competition and promote professionalism in the operational culture of the organizations.  

CEA Krishnamurthy in his press meet said that the Economic Survey was based on ten new central ideas that will pave the way ahead for wealth creation and trigger long-term sustained growth of the economy. These include

• Wealth Creation Benefits All
• Invisible hand of Markets enable Wealth Creation
• Trust is a ‘public good’ that grows with use
• Grass-root Entrepreneurs create wealth in their district
• Pro-bubsiness policies give equal opportunities
• Remove anachronistic Govt Interventions
• Job Creation by merging ‘Assemble in India’ and Made in India
• Changes to EODB for India to rank in top 50
• Banking sector sub-scale compared to Economy
• Thalinomics       

Economic Survey said that Indian’s Banking Sector needs urgent attention and reforms that can support the growing economy. The survey calls for a healthy banking sector that is led by Public Sector Banks. Among the three key recommendation for banking sector, the survey mentions use of Fintech across all banking functions, employee ownership to enhance efficiency and use of emerging technologies such as big-data, artificial intelligence and machine learning to improve operations.

India’s Cheif Economic Advisor address media on Economic Survey 2019-20. He starts the meet by saying that the survey is ‘synthesis of old and new’, which is also reflected in Lavender colour and the Rupee symbol used on the cover.

CEA has attributed slowdown in India’s growth in 2019 as part of the global economic slowdown.

All groups of countries have slowed down, in a globalized economy, India too has felt the effect - CEA @SubramanianKri

Watch LIVE: https://t.co/pnPOHYHw4h#EconomicSurvey #WealthCreation pic.twitter.com/hrZXFX1yVu

— PIB India (@PIB_India) January 31, 2020

Talking about government intervention on economic activity; the Economic Survey cites that commodities, drugs, foodgrain and debt waivers to buttress to highlight the negative impact such measures can have on the economic health of India. Further elaborating the point, CEA added that government intervention was a norm in 1980s when market failure rate was much higher; but in contemporary economic environment,  such interventions only lead to disruptions.

Government intervention is required when there is market failure, the market failures today are much less than they were in the 1950s or the 1980s; this should be considered while reviewing our laws

- CEA @SubramanianKri

Watch LIVE: https://t.co/pnPOHYHw4h#EconomicSurvey pic.twitter.com/JqqbSbsN4G

— PIB India (@PIB_India) January 31, 2020

Economic Survey also talks about Employment Data which showcased that around 2.62 crore new jobs were createdin rural and urban areas between 2011-12 and 2017-18. Of the total jobs created, around 1.21 crore in rural areas and 1.39 crore in urban areas under regular wage and salaried employees category. Of the total number of jobs created for regular wage and salaried employees; there has been around 8% growth in regular Employment of Women in 2017-18 over 2011-12. The survey also adds that around 69.03 lakh people were trained under Pradhan Mantri Kaushal Vikas Yojana (PMKVY).  

• Total Number of Jobs Created in 5 years: 2.62 crore
• Total Number of Jobs Created in Rural Areas: 1.21 crore
• Total Number of Jobs Created in Urban Areas: 1.39 crore
• Growth in Employment of Women wage earners: 8%
• Number of candidates trained under PMKVY: 69.03%

As part of the roadmap to the ambitious target of achieving USD 5 Trillion Economy, the Economic Survey highlighted that India needs to invest UDS 1.4 Trillion on the development of Infrastructure. Lack of Infrastructure was cited as a 'binding constraint' on the economic growth ranging from power infrastructure, transport and poor connectivity.

The Economic Survey 2019-20 presented in the Parliament today looked at the Indian Economy and its importance for common people of India through Thalinomics. The survey collected and compiled data for price of a Thali – a decent meal, in different states across India, to find out the national average. The key finding of this exercise showcased that Thali for both vegetarians and non-vegetarians have become more affordable over the years.

For a family of 5, the average price of vegetarian Thali has fallen by 28% as compared to 18% fall in a non-vegetarian Thali. Affordability of a Thali is depended on two factors i.e. prices of food coupled with increase in the average salary. The survey also admitted that the average price of thali has gone in 2019. The state-wise price-band for thali prices across India is given below:

Indian Economy Snapshot

GDP Growth Projected at 6 to 6.5%

The first key statistic coming from Economic Survey 2019-20 pegs India’s economic growth at 6-6.5% in fiscal year starting April 1, 2020. The growth projection has been based on strong rebound growth in H2 of FY21.

#EconomicSurvey 2019-20 projects GDP to grow at 6.0% - 6.5% in 2020-'21#BudgetSession2020 #WealthCreation pic.twitter.com/o2MxDP154J

— PIB India (@PIB_India) January 31, 2020

Economic Survey to be Tabled Shortly

Finance Minister Nirmala Sitharaman is expected to table he Economic Survey in both the houses of Parliament shortly. Economic Survey - the annual report card of Indian Economy, will provide an overview of India's macro-economic situation and also lay the foundation for the Budget 2020 which will be announced tomorrow. 

Opposition reacts to President's Address

Congress leader P Chidambaram has reacted to President Kovind’s Address to the joint session of the Parliament through a tweet. He said no concrete “policy statement of the government” from Government in the New Year.

The President’s Address is the first policy statement of the government in the new year. I looked for indications on how the government intended to tackle the grave economic slide. Alas, I found none.

— P. Chidambaram (@PChidambaram_IN) January 31, 2020

CEC KV Subramanian on Economic Survey 2019-20

Chief Economic Advisor Krishnamurthy Subramanian on Economic Survey: Our team has done a lot of hard work. The team has prepared the second economic survey in six months. pic.twitter.com/9Jtm0mXq1G

— ANI (@ANI) January 31, 2020

CAA fulfilled dream of Mahatma Gandhi: President Kovind

President Ram Nath Kovind said that Mahatma Gandhi gave a call to all Hindus who do not want to live in Pakistan can come to India. With the Citizenship Amendment Act, Modi Government has ‘fulfilled this vision of Bapu’. The mention of CAA in president’s speech was met with protest by opposition with sloganeering from Opposition leaders.

हमà¥?à¤? यह हमà¥?शा याद रà¤?ना à¤?ाहिà¤? à¤?ि à¤?िसà¥? भà¥? विà¤?ारधारा à¤?à¥? नà¥?ता या समरà¥?थà¤? हà¥?नà¥? सà¥? पहलà¥? हम दà¥?श à¤?à¥? नाà¤?रिà¤? हà¥?à¤?। हमारà¥? दà¥?श à¤?à¥? पà¥?रतिषà¥?ठा हमारà¥? दलà¥?य पà¥?रतिबदà¥?धताà¤?à¤? सà¥? à¤?हà¥?à¤? बढ़à¤?र हà¥? â?? राषà¥?à¤?à¥?रपति à¤?à¥?विनà¥?द pic.twitter.com/aKKCeS0Ef6

— President of India (@rashtrapatibhvn) January 31, 2020

President recounts key achievement of Parliament

President Kovind in his joint address to both the houses of Parliament highlighted the key achievements of the Government in the previous year. In his address he talked about the path-breaking legislations passed by Parliament. President Kovind mentions Triple Talaq Bill, Consumer Protection Bill, Chit Fund Amendment Law, Motor Vehicle Act, Transgender Right Protection Bill as major acheivementts of the current government.

The Central and Assam Governments have recently signed a historic agreement with the Bodo Organizations to bring an end to the 5 decade-old Bodo dispute: President Kovind pic.twitter.com/TFQB23JbRM

— President of India (@rashtrapatibhvn) January 31, 2020

President Talks about Violent Protests Protests

Addressing the issue of anti-CAA protests and the violence that has marred the country since December 2019. In his address he mentioned that any kind of violence in the name of protest weakens the society and the country. He further added that government is open for mutual discussions and debates that strengthen the democracy. 

CEA KV Subramanian Presser at 1:45 PM

Chief Economic Advisor to the GoI will hold a Press Conference at 1:45 PM to discuss key highlights and important aspects of Economic survey being tabled today in Parliament. The Press Conference will be streamed live on various social platforms of Press Information Bureau.

Press Conference by Chief Economic Advisor Dr. KV Subramanian on #EconomicSurvey 2019-20

ð???ï¸?- Today, January 31st
â?°- 1:45 PM
ð??? - National Media Centre

Watch on #PIB's
YouTube: https://t.co/pnPOHYHw4h
Facebook: https://t.co/p9g0J6q6qv pic.twitter.com/fW19NkVlxM

— PIB India (@PIB_India) January 31, 2020

President Ram Nath Kovind to address Joint Session

President Ram Nath Kovind will address the joint session of the Parliament to mark the start of the Budget Session. President’s motorcade has left for the Parliament house where he will address MPs from both Loksabha and Rajyasabha. Following this, Finance Minister is expected to table the Economic Survey 2019-20 in the Parliament.

हमारा सà¤?विधान, à¤?स सà¤?सद सà¥? तथा à¤?स सदन मà¥?à¤? à¤?पसà¥?थित पà¥?रतà¥?यà¥?à¤? सदसà¥?य सà¥? राषà¥?à¤?à¥?रहित à¤?à¥? सरà¥?वà¥?परि रà¤?तà¥? हà¥?à¤? दà¥?शवासियà¥?à¤? à¤?à¥? à¤?शाà¤?à¤?-à¤?à¤?ाà¤?à¤?à¥?षाà¤?à¤? à¤?à¥? पà¥?रà¥?ति à¤?रनà¥? à¤?र à¤?नà¤?à¥? लिà¤? à¤?वशà¥?यà¤? à¤?ानà¥?न बनानà¥? à¤?à¥? à¤?पà¥?à¤?à¥?षा भà¥? रà¤?ता हà¥? â?? राषà¥?à¤?à¥?रपति à¤?à¥?विनà¥?द

— President of India (@rashtrapatibhvn) January 31, 2020

India’s Growth Projection Expected at 6%

As per financial and economic experts, the Economic Survey 2019-20 will project India’s GDP growth to range between 6% to 6.5% for the financial year starting 1^st April 2020. At the start of Budget Session, both equity indices i.e. Sensex and Nifty remained positive ahead of Economic Survey. On the other hand, Indian Rupee appreciated by 17 paise to 71.41 against the US dollar in early trade on Friday.

About GOI’s Chief Economic Advisor Krishnamurthy Subramanian

Mr Krishnamurthy Subramanian took over as the Chief Economic Advisor to the Government of India in December 2018. He succeeded Mr Arvind Subramanian who served as India’s CEA from 2014 to 2018. Our current Chief Economic Advisor Mr Subramanian is an alumnus of IIT Kanpur and IIM Calcutta. On academic front he also holds a Doctorate from Chicago Booth School of Economics. The Economic Survey 2019-20 being presented today has been prepared under his supervision.

PM Modi ahead of Budget Session

PM Modi addressed media persons at the start of Budget Session. He said that this will be first Parliament session of the new decade and therefore it is important to make it a productive one to lay a strong foundation for future. He added that the session will primarily focus on economic issues and he hopes that both the houses have good debate and discussions on important topics.

Who Prepares Economic Survey?               

Economic Survey is prepared by the Economic Division of the Department of Economic Affairs which operates under the aegis of the Finance Ministry. The Survey is prepared by a dedicated team of economist who work under the supervision of Chief Economic Adviser to prepare the report card of Indian Economy. Before being presented in the Parliament, the Economic Survey is reviewed by the Finance Secretary Rajiv Kumar and is also approved by Finance Minister Nirmala Sitharaman.

Stormy Budget Session Ahead

With economic slowdown and anti-CAA protests throughout the country; the Budget Session of the Parliament is likely to get off to a stormy start. Congress leaders along with Opposition Parties hold a protest outside the Parliament against the Citizenship Amendment Act. Congress President Sonia Gandhi along with Rahul Gandhi is leading the protest in Parliament campus.

#BudgetSession Trinamool's silent protest against #CAA, #NRC and #NPR during President's address in Central Hall. Silently holding up posters. Video coming soon pic.twitter.com/qOkOJwhNoy

— All India Trinamool Congress (@AITCofficial) January 31, 2020

What details does the Economic Survey Contain?

Typically, the Economic Survey is divided into three key sections or parts i.e.

1. Economic Overview – In this section, the Finance Ministry outlines the Government’s general outlook and the financial condition of the Indian Economy. It also presents the key policy decision, achievements, future objectives and long and short-term challenges that the economy faces.
2. Industry / Sector-wise Data – the second part of the Economic survey is dominated by Data. The second part comprises of data that has been compiled by the Finance Ministry from various ministries and departments.
3. Economic Balance Sheet – The third and final part of the report focuses on the economic balance sheet of the country in the year gone by. This section deals with macro-economic aspects of the economy with prime focus on national income, production, employment, inflation, balance of trade and export-import trade. 

What is Economic Survey?

Economic Survey is the annual report card of Indian Economy that is presented by the Government of India in the Parliament. The report provides in-depth review and analysis of various aspects of the Indian Economy. The report card evaluates the current state of economy and also highlights both short-term as well as long term challenges that lie before the economy. Economic survey is a very important document as it provides data, statistics and overview for the policy decisions, schemes and announcements that are made in the Union Budget.