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ECONOMIC SURVEY 2023-24: SALIENT FEATURES |
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ECONOMIC SURVEY 2023-24: SALIENT FEATURES |
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The Economic Survey comes when India celebrates 75th year of its independence. According to Economic Survey 2023-24, India is back to pre-pandemic growth with broad based recovery. Indian services sector continues to the source of strength with 9% growth in current year. Tax buoyancy is now being witnessed under GST regime. Further, despite the three shocks of COVID-19, Russian-Ukraine conflict and the Central Banks across economies led by Federal Reserve responding with synchronised policy rate hikes to curb inflation, leading to appreciation of US Dollar and the widening of the Current Account Deficits (CAD) in net importing economies, agencies worldwide continue to project India as the fastest-growing major economy at 6.5-7.0 per cent in FY 2023. India is likely to witness GDP growth of 6.0 per cent to 6.8 per cent in 2023-24, depending on the trajectory of economic and political developments globally. Economic survey 2022-23 projects a baseline GDP growth of 6.5 per cent in real terms in FY24. Economy is expected to grow at 7 per cent (in real terms) for the year ending march 2023, this follows an 8.7 per cent growth in the previous financial year. The optimistic growth forecasts stem from a number of positives like the rebound of private consumption given a boost to production activity, higher Capital Expenditure (Capex), near-universal vaccination coverage enabling people to spend on contact-based services, such as restaurants, hotels, shopping malls, and cinemas, as well as the return of migrant workers to cities to work in construction sites leading to a significant decline in housing market inventory, the strengthening of the balance sheets of the Corporates, a well-capitalised public sector banks ready to increase the credit supply and the credit growth to the Micro, Small, and Medium Enterprises (MSME) sector etc. The Indian economy has become a lot more formalized as reflected in the EPFO membership more than doubling to 27 crore, and 74,00 crore digital payments of Rs. 126 lakh crore through UPI in 2022. The Survey states with optimism that Indian economy appears to have moved on after its encounter with the pandemic, staging a full recovery in FY22 ahead of many nations and positioning itself to ascend to the pre-pandemic growth path in FY23. Yet in the current year, India has also faced the challenge of reining in inflation that the European strife accentuated. The factors like monetary tightening by the RBI, the widening of the CAD, and the plateauing growth of exports have essentially been the outcome of geopolitical strife in Europe. As these developments posed downside risks to the growth of the Indian economy in FY23, many agencies worldwide have revised their growth forecast of the Indian economy downwards. For fiscal 2023-24, growth will be supported by solid domestic demand and a pickup in capital investment. It says that aided by healthy financials, incipient signs of a new private sector capital formation cycle are visible and more importantly, compensating for the private sector’s caution in capital expenditure, the government raised capital expenditure substantially. India: Economic Survey 2023-24 Following are the highlights of Economic Survey tabled in Parliament on 31.01.2023 :
(Source: Economic Survey 2023-24) General & Economy Highlights of Union Budget 2023-24
(Source: Union Budget 2023)
By: Dr. Sanjiv Agarwal - February 6, 2023
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