Economic Survey 2022
Recently Finance Minister Nirmala Sitharaman gave the Economic Survey 2022 report in the Lok Sabha, which predicted an 8-8.5 percent GDP growth rate for the fiscal year 2022-23. (FY23). The economy is predicted to grow at a rate of 9.2 percent this fiscal year.
Economic Survey 2021-22 – Highlights
State of the Economy:
- Following a decrease of 7.3 percent in 2020-21, the Indian economy is expected to grow by 9.2 percent in 2021-22.
- In 2022-23, GDP is expected to expand by 8-8.5 percent.
- The projection is equivalent to the current World Bank and Asian Development Bank predictions of 8.7% and 7.5 percent real GDP growth for 2022-23, respectively.
- India's real GDP is expected to rise at 9% in 2021-22 and 2022-23, and 7.1 percent in 2023-2024, according to the IMF's latest World Economic Outlook predictions.
- In 2021-22, agriculture and related industries are predicted to grow by 3.9 percent, industry by 11.8 percent, and services by 8.2 percent
- In 2021-22, consumption is expected to increase by 7.0 percent, GFCF by 15 percent, exports by 16.5 percent, and imports by 29.4 percent on the demand side.
- High foreign exchange reserves, continuing foreign direct investment, and expanding export revenues will provide an adequate cushion against potential global liquidity tapering in 2022-23.
- The Central Government's revenue receipts increased by 67.2 percent from April to November 2021, compared to a 9.6 percent increase predicted in the 2021-22 Budget Estimates.
- In terms of YoY growth, gross tax revenue increases by more than 50% from April to November 2021.
- This is also a strong performance when compared to pre-pandemic levels in 2019-2020.
- Capex grew by 13.5 percent from April to November 2021, with a concentration on infrastructure-intensive sectors.
- The budget deficit for April to November 2021 was 46.2 percent of BE, due to continued tax collection and a targeted expenditure approach.
- The Central Government debt has increased from 49.1 percent of GDP in 2019-20 to 59.3 percent of GDP in 2020-21 as a result of increased borrowings for COVID-19 but is expected to decline as the economy recovers.
- During the current fiscal year, India's merchandise exports and imports returned rapidly and reached pre-COVID levels.
- Despite low tourism earnings, net services increased significantly, with collections and payments exceeding pre-pandemic levels.
- In the first half of 2021-22, net capital flows increased to USD $ 65.6 billion, owing to ongoing foreign investment, a resurgence in net external commercial borrowings, higher banking capital, and additional special drawing rights allocation.
- India's external debt increased to USD 593.1 billion at the end of September 2021, up from USD 556.8 billion a year earlier, as a result of the IMF's enhanced SDR grant and greater commercial borrowings.
- India's external debt increased to USD $ 593.1 billion at the end of September 2021, up from USD $ 556.8 billion a year earlier, as a result of the IMF's enhanced SDR allocation and greater commercial borrowings.
- In the first half of 2021-22, foreign exchange reserves surpassed US$ 600 billion, reaching USD $ 633.6 billion as of December 31, 2021.
- Japan, Switzerland, India has the world's fourth-largest foreign reserves at the end of November 2021.
Monetary Management and Financial Intermediation:
- The commercial banking system has handled the economic blow of the pandemic well: From 5.3 percent in April 2021 to 9.2 percent as of December 31, 2021, YoY bank credit growth accelerated considerably in 2021-22.
- Scheduled Commercial Banks had a Gross Non-Performing Advances ratio of 6.9% at the end of September 2021, down from 11.2 percent at the end of 2017-18.
- During the same time period, the ratio of net non-performing advances fell from 6% to 2.2 percent.
- SCBs' capital-to-risk-weighted-asset ratio increased from 13 percent in 2013-14 to 16.54 percent by the end of September 2021.
- For the period ending September 2021, Public Sector Banks' Return on Assets and Return on Equity were positive.
- Capital markets had an exceptional year in 2021, with 75 Initial Public Offering transactions raising Rs. 89,066 crores, far more than any other year in the previous decade.
- Indian markets beat rivals among major emerging market economies from April to December 2021.
Prices and Inflation:
- The average headline CPI-Combined inflation moderated to 5.2 percent in 2021-22 from 6.6 percent in the corresponding period of 2020-21.
- The decrease in food inflation drove down retail inflation.
- Food inflation averaged at a low of 2.9 percent in 2021-22 as against 9.1 percent in the corresponding period last year.
- Wholesale inflation, as measured by the Wholesale Price Index, increased to 12.5% in 2021-22.
- The disparity between CPI-C and WPI Inflation: In May 2020, the divergence reached a high of 9.6 percentage points.
Sustainable Development and Climate Change:
- India's total score on the NITI Aayog SDG India Index and Dashboard rose to 66 in 2020-21 from 60 in 2019-20 and 57 in 2018-19, up from 60 in 2019-20 and 57 in 2018-19.
- From 10 states and territories in 2019-20, the number of Front Runners climbed to 22 in 2020-21.
- India has the tenth biggest forest area in the world, and it placed third in the world in terms of expanding forest area from 2010 to 2020 in 2020.
- India's forests will cover 24 percent of the country's land area by 2020, accounting for 2% of the world's total forest area. The Plastic Waste Management Amendment Rules, 2021, were notified in August 2021, with the goal of phasing out single-use plastic by 2022.
- Notification of a draught rule on Extended Producer Responsibility for plastic packaging.
Agriculture and Food Management:
- In the last two years, the agriculture sector has enjoyed strong growth, accounting for 18.8% of the country's Gross Value Added, with the growth of 3.6 percent in 2020-21 and 3.9 percent in 2021-22.
- Crop diversity is aided by the Minimum Support Price program.
- Agriculture's allied industries, including animal husbandry, dairy, and fisheries, are progressively developing as high-growth sectors and important drivers of total growth.
- Over the five years ending in 2019-20, the livestock industry grew at an annual rate of 8.15 percent.
- The government encourages food processing through infrastructure development, subsidized transportation, and support for the formalization of micro food businesses, among other things.
- India has one of the largest food management programs in the world. Through programs like the PM Gareeb Kalyan Yojana, the government has expanded the reach of food security networks.
Industry and Infrastructure:
- From April to November 2021, the Index of Industrial Production increased by 17.4%, compared to 15.3% in April to November 2020.
- The Indian railroads' capital spending grew to Rs. 155,181 crores in 2020-21, up from an average year of Rs. 45,980 crores in 2009-14, and it is expected to rise to Rs. 215,058 crores in 2021-22, a five-fold increase over the 2014 figure.
- The amount of road-building per day grew by 30.4 percent in 2020-21, from 28 km per day in 2019-20 to 36.5 km per day in 2020-21.
- Despite the pandemic, the net profit to sales ratio of large corporations reached an all-time high of 10.6 percent in the July-September quarter of 2021-22. The major boost provided to infrastructure, both physical and digital, as well as measures to reduce transaction costs and improve ease of doing business, would support the pace of recovery.
- In the July-September quarter of 2021-22, the GVA of services exceeded the pre-pandemic level; however, the GVA of contact-intensive sectors such as commerce, transportation, and others did not.
- In 2021-22, the whole service sector GVA is predicted to expand by 8.2%.
- The service sector received over US$ 16.7 billion in FDI in the first half of 2021-22, accounting for about 54 percent of total FDI inflows into India.
- Revenue from IT-BPM services reached US$ 194 billion in 2020-21, with 1.38 lakh new people hired during that time.
- Major government changes include the elimination of telecom rules in the IT-BPO industry and the privatization of the space sector.
- In the January-March quarter of 2020-21, services exports reached the pre-pandemic level, and in the first half of 2021-22, they climbed by 21.6 percent, boosted by worldwide demand for software and IT services exports.
In 2021, 44 Indian start-ups will have earned unicorn status, bringing the total number of unicorns to 83, the majority of which will be in the services sector.
Economic Survey 2021-22 Projection
- As Asia's third-largest economy shows signs of recovery from the epidemic, the Economic Survey for 2021-22 is projected to estimate the growth of roughly 9% for the following financial year.
- Economic growth is expected to be 11% in 2021-22. However, India's statistics ministry estimates that the current fiscal year's economic growth would be only 9.2 percent.
- According to the Economic Survey 2018-19, GDP growth for fiscal 2019-20 is expected to be 7%. The economy grew at a rate of barely 4%. The Economic Survey 2017-18 forecasted a growth rate of 7-7.5 percent in 2018-19, however, GDP actually increased by 6.5 percent. Actual GDP growth in 2015-16 and 2017-18, on the other hand, was practically identical to the range forecast in the corresponding economic surveys.
- GDP grew at a quicker rate in 2016-17 than predicted in the Economic Survey 2015-16.
All in all this recent Survey has definitely shown an upward trajectory to the nation’s and the world's economy.
The Economic Survey of India is a document that the Ministry of Finance releases every year to give a detailed account of the state of the Indian economy. The survey is available in both English and Hindi and was first published in 1951-52. It has been released annually since then with some exceptions and is also called the Union Budget Report.
The Economic Survey of India contains a host of data on various aspects such as agriculture, industry, manufacturing, trade, and services. It also provides data on sectors such as construction and mining. The survey covers a wide range including macroeconomic developments, fiscal performance, monetary policy, trade and industry performance, employment and poverty, infrastructure development, and food security. There are also chapters on education and health care which provide information about their current state and what needs to be done to improve them in the future.
It is not just for economists to whom this document is important, but it also serves as an important resource for UPSC aspirants studying for UPSC Prelims and Mains exam.
Economic Survey Introduction
The Ministry of Finance's Faculty of Economics publishes an economic survey of India to Parliament each year just before the Union budget. This document is submitted to both houses of the Parliament during the budget meeting.
The Economic Survey reviews trends in the Indian economy over the previous 12 months, focusing on government policy initiatives, summarizing the performance of key development programs, and outlining economic growth prospects.
The Economic Survey 2021 was published by the current Chief Economic Advisor (CEA), Krishnamurti Subramanian, before the 2021 Union Budget.
Importance of Economic Survey:
Economic Survey is an important resource for both UPSC prelims and mains exams, especially for subjects like India's economic, political, and government schemes.
The Economic Survey describes all major government initiatives with explanations. All dynamic and theoretical questions can be traced back to this report. According to the new trends, the economy and the environment are inextricably linked. This report analyzes and substantiates many of the problems that arise in the environment. Questions may be asked from this perspective as well.
In-depth knowledge of current government policies and programs will also help aspirants write powerful essays and Students can even record the actual idioms used in the Economic Survey and work them into UPSC exam answers.
In addition, the issues that are evaluated and reforms that are proposed in Economic Surveys are often implemented by the government in future initiatives. A good example of this is the Direct Benefit Transfer (DBT) proposed in a previous Economic Survey that was later implemented by the government. Aspirants can use it in the exam to get a better score by using appropriate snippets from the survey Like "Good economics is good politics", "twin balance sheet problem", "Turning possibilities into reality", "Chakravyuha challenge" and so on. Adding important and relevant facts and numbers will greatly improve your performance in General Studies Paper III.
Since many questions will be asked directly from the Economic Survey students should be sure to read it carefully to pass the UPSC Prelims.
How to read the UPSC Economic Survey?
Economic survey patterns: The Economic Survey consists of two volumes.
Volume I: Addresses conceptual and analytical issues.
Volume 2: Focuses on immediate issues and statistics, it covers the state of the economy and the economic sector in more detail.
Read the Preface Carefully: The preface to an Economic Survey is like a summary of the document. Reading it will give you the essence of what’s in it and help you better understand it.
Boxes and Arguments: This document contains many boxes that are especially important for UPSC testing. You can also use this data to enrich and support your answers. The survey also includes discussions on why the program or initiative is important, how it can be improved, and recommendations for use in the main answers.
Tips on how to read the Economic Survey:
Read after your undergraduate degree: Students need to have a basic understanding of economics, especially concepts such as GDP, inflation, and financial resistance, before proceeding to study Economic Surveys.
Breaking into smaller topics: If you find reading Economic Surveys overwhelming, you can easily cover them by breaking them into smaller topics. The contents of the survey include the welfare system, macroeconomic real assets, demographics, agriculture, urbanization, social empowerment, and figures (unemployment data, GDP, inflation, food inflation, budget deficit, current account deficit, balance, etc.).
The Economic Survey contains the most meaningful and up-to-date data sources on the Indian economy. This is usually presented one day before the federal budget is presented in Parliament. This post provides answers to the most frequently asked questions about economic research.
What is an economic survey?
The Economic Survey provides a detailed overview of the country's various economic sectors and macroeconomic scenarios over the past few years and provides an outlook for next year. Increasingly, it has become a forum for economic analysis and research, and thus a source of many political ideas.
Who prepares the Economic Survey?
The Economic Survey was produced by the Economic Affairs Bureau of the Ministry of Finance's under the general direction of the Chief Economic Advisor. After receiving feedback from the Treasury Secretary, the final version of the Economic Survey will be reviewed by the Treasury Secretary and eventually approved by the Federal Treasury Secretary.
When will the Economic Survey be released?
Announced annually in Parliament during a budget meeting, Economic Surveys are usually presented one day prior to the presentation of the General budget by the Minister of Finance in Parliament.
Why is it presented before the budget?
Economic surveys provide background on a country's financial development, as well as an assessment of the overall performance of the economy for the year. The survey was separated from the budget in 1964 and pre-distributed to provide budget context. In this way, it contributes to a better understanding of the budget proposal.
What is included in the Economic Survey?
The Economic Survey is not only a government document but also an opportunity for the chief economic adviser to provide an indifferent and economically objective analysis.
Where can I find the Economic Survey?
This document is available in PDF format at https://iastarget.com/economic-survey
. Students can also visit Govt website www.indiabudget.gov.in/economicsurvey/