Economic Survey 2015-16
Union Minister of Finance, Arun Jaitley, tabled the Economic Survey 20-15-16 in Parliament of India on February 26, Z016. The economic survey was prepared by the Chief Economic Advisor Arvind Subramanian.
As per the survey, Indian economy is growing at a pace of 7% to 7.5% and it is expected to accelerate at 8% in the coming years. India’s macro-economy is sturdy and it is likely to be the fastest growing major economy in the world in 2016 as it shows an expansion from 7,2% In 2014-15 to 7.6% in current fiscal.
Fiscal Deficit
- India has decided to meet its medium-term fiscal deficit target of 3% of GDP.
- The government is planning to reduce its to fiscal deficit target of 4,1% of GDP in 2014-15.
- The government is also planning to curb its expenditure control to reduce fiscal deficit.
Growth
- India registered robust growth of 7.2% in 2014-15 and 7.6% in 2015-16, thus becoming the fastest Stowing ma jor economy in the world whereas global growth averaged 3.1% in 2015, declining from 3.4% registered in 2014.
- India’s contribution to global growth in PPP terms increased from an average of 8.3% during the period 2001 to 2007 to 14.4% in 2014.
- The Gross Value Added registered an increase in the growth rate from 5.4% in 2012-13 to 7.1% in 2014-15. For 2015-16 it is pegged at 7.3%.
Exports & Imports
- Exports and imports together constitute 42% of the GDP in 2015-16. After reaching unsustainable high levels, trade and current account deficits moderated on import restrictions in 2013-14 and continued so in 2014-15.
- India’s merchandise exports have been declining continuously since December, 2014. During April to January, 2015-16, India’s exports declined year-on-year by 17.6% and in amount it is $ 217.7 billion.
Sectorwise Performance Agriculture
- The contribution of agriculture and allied sectors to the GVA (at 2011-12 prices) has been Reclining.
- The growth rales in agriculture have been fluctuating at 1.5% in 2012-13, 4.2% in 2013-14, (-) 0.2% in 2014-15 and a likely growth of 1.1% in 2015-16.
Industrial Corporate and Infrastructure Performance
- Within the industrial sector, manufacturing is. expected to register a growth of 9.5%.
- The eight core infrastructure-supportive industries in IIP, which have a 58%, registered a cumulative growth of 1.9% during April to December, 2015-16 as compared to 5.7% during April to December, 2014-15.
- The growth is expected to 7.3% for 2015-16 as per the A£ released by the CSO.
Services Sector
- In 2015-16, the services sector registered a growth of 9.2% (constant prices), mainly due to the lower growth of 6.9% in public administration, defence and other services vis-a-vis 10.7% growth achieved in 2014-15.
Highlights of Economic Survey 2015-16
- GDP growth rate for 2015-16 to be in the range of 7% to 7.75%. The government will meet its fiscal deficit target of 3.9% of GDP.
- Growth in the services sector moderated slightly, but still remains robust. Services continues to be key driver; expected to be 9.2% in 2015-16.
- Economic Survey projects 7.6% economic growth rate in 2015-16. Foreign exchange reserves have risen to $ 349.6 as on January, 2016.
- Reform package announced for the fertilizer sector.
- Rates of 8% or higher possible in next 2 years, given macroeconomic stability.
- Impressive strides made in the power sector in the last two years.
- India ranks first in milk production, accounting lor 18.5% ol world product ion.
- Medium-term growth tnyectory at 7-7.75% with downside risk. Downside risk to medium term growth due to global economic condition.
- Increase in wages recommended by the 7th Pay Commission not likely to destabilise prices, will have little Impact on inflation
- It further says that perhaps the underlying anxiety is that the economy is not realising its full potential.
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