Finance Minister Nirmala Sitharaman has presented the Economic Survey 2021 in Parliament today and it is today given to Chief Economic Advisor K.V. Subramanian launched. The Economic Survey estimates gross domestic product (GDP) growth to be higher than China. This survey reveals the picture of the country’s economy during the Corona crisis.
According to the survey, due to Corona, GDP in the current financial year. It is expected to fall by 7.7 percent, but after that, there will be a V-shape, hence the GDP in 2021-22. I will grow 11 percent. Nevertheless, it will take 2 years for the economy to reach pre-pandemic levels.
Need for incentives and social security benefits
From April to June 2020 from Lockdown due to coronavirus, GDP was released. The size was reduced by 23.9 percent. After unlocking, the situation improved and the September quarter fell to just 7.5 percent. Thus in the first half of 2020-21, the GDP size is reduced by 15.7 percent. The survey estimated that there would be only a 0.1 percent drop in the second half. However, the major reason for this is the increase in government spending.
The survey also has a roadmap for the Indian economy, so special attention has been given to many things to become a $ 5 trillion economy. The Economic Survey 2020-21 ‘has been prepared by a team led by Chief Economic Advisor Krishnamurthy Venkat Subramanian, which describes the state of the various sectors of the economy as well as the reforms that must be undertaken to speed up development. The Economic Review states that there is a need for pay and career advancement, incentives for better work, and social security benefits for women at the workplace to increase women’s participation in the workforce in India.
Agricultural growth rate to be 3.4 percent, negative growth in industry and services
The biggest support for the economy this year is agriculture. Its growth rate is expected to be 3.4 percent. Gdp Its share in will also increase. It was 17.8 percent in 2019-20, to be 19.9 percent this year. Apart from agriculture, 2 sectors of the economy are industry and services. The industry is expected to decline 9.6 percent in the current financial year. The growth of the service sector will also be -8.8 percent. The weightage of food products should be revised to reflect the true picture of inflation in the country. The review noted that inflation should include new sources of price data amid increasing retail e-commerce transactions.
85 percent of small farmers in the country benefit from new agricultural laws
These laws have been praised in the survey, even though farmers have been agitating for 2 months in protest against the new agricultural laws. Accordingly, the new laws will benefit small farmers. Farmers will have more rights when dealing with processors, whole sellers, and big retailers. 85 percent of the total farmers in the country are small farmers. Given the uncertainty in farming, the risk still remains for farmers. The risk from the new laws will be for those who deal with farmers in contract farming. Farmers will be able to fix the price of their crop. They will also get their payment in three days. Contract farming will also bring new technology to farming.
The survey found government spending on health care Has been said to be taken from 2.5 to 3 percent. This goal was also set in the National Health Policy of 2017. Despite this, it is still around 1 percent. Spending should increase in Internet connectivity and health infrastructure. The telemedicine also needs to be promoted.
Innovation is necessary to become the third major economy
The survey also mentioned the measures that can be adopted to accelerate the economic growth rate. It says that India is currently the 5th largest economy in the world. If it is to reach the third position, then it is important to focus on innovation. The global economy will also decline by 4.4 percent this year due to Corona. This will be the biggest decline in a century.
The government should revive taxpayer grievance redressal system by giving it more powers. In the year of salvation, 2021-22, G.D.P. Is likely to remain positive. The services and manufacturing sector has been negative in FY 2020-21. At the same time, real GDP in FY 2022. Growth is projected at 11 percent, while nominal GDP. The estimate is 15.4 percent. At the same time, the International Monetary Fund also says that India’s economy will be 11.5 percent in 2021 and in 2022 it will be around 6.8 percent.
Able to cover standard deviation, there will be a complete recovery in the economy in the next financial year. The derailed economy is now gaining momentum due to the Corona virus pandemic. V-shaped recovery has been observed in India. Steps to increase investment will be emphasized. Business activity will increase due to lower interest rate. It stated that the corona vaccine is possible to control the Pandemic and concrete steps are expected to be taken for further economic recovery.
Sovereign credit ratings of India do not provide information about fundamentals, written in a survey. Never in history has the BBB been rated as the 5th largest economy in the world. The fundamentals of India’s financial policy are strong. India’s forex reserve is capable of covering 2.8 standard deviations.
It is important that the sovereign credit rating methodology be made transparent. The Government of India has recognized 41,061 startups as on 23 December 2020. More than 39,000 start-ups across the country have provided employment to 4,70,000 people. SIDBI has committed Rs 4,326.95 crore to 60 alternative investment funds registered with SEBI by 1 December 2020.