Budget Session 2018: Economic Survey predicts 7-7.5% GDP growth in FY19

Arun Jaitley
Arun Jaitley, File Photo

New Delhi, Jan 29: The Economic Survey 2017-2018  tabled by Finance Minister Arun Jaitley in the Parliament predicts India’s GDP growth to be between 7-7.5% in FY 2018-2019.

The survey said that agriculture, education, and employment are likely to be the core areas in the medium term.

“A series of major reforms undertaken over the past year will allow real GDP growth to reach 6.75 per cent this fiscal and will rise to 7.0 to 7.5 percent in 2018-19, thereby re-instating India as the world’s fastest growing major economy,” the Survey stated.

It also revealed the reform measures undertaken in 2017-18 can be strengthened further in 2018-19.

The Survey underlined that the economy started to accelerate in the second half of the year and can clock 6.75 per cent growth this fiscal due to the roll out of transformational Goods and Services Tax reform on July 1, 2017 and resolution of the long-festering Twin Balance Sheet problem by sending the major stressed companies for resolution under the new Indian Bankruptcy Code.

Implementing a major recapitalisation package to strengthen the public sector banks, further liberalisation of foreign direct investment and the export uplift from the global recovery had played a major role in boosting the growth, It stated.

The Survey, however, highlighted that according to the quarterly estimates there was a reversal of the declining trend of GDP growth in the second quarter of 2017-18, led by the industry sector.

It said that India can be rated as among the best performing economies in the world as the average growth during past three years is around 4 percentage points higher than global growth and nearly 3 percentage points more than that of emerging market and developing economies.

“Inflation in the country continued to moderate during 2017-18. Consumer Price Index(CPI) based headline inflation averaged 3.3 per cent during the period which is the lowest in the last six financial years”, the survey said.

“A preliminary analysis of the GST data reveals that there has been a 50% increase in no. of indirect taxpayers, besides a large increase in voluntary registrations, especially by small enterprises”, it stated.

“Maharashtra, UP, Tamil Nadu and Gujarat are the states with the greatest number of GST registrants. UP and West Bengal has been large increases in the number of tax registrants compared to the old tax regime”.

The survey claimed that for the very first time in India’s history that 5 states, Maharashtra, Gujarat, Karnataka, Tamil Nadu&Telangana account for 70% of India’s exports. India’s internal trade in goods&services (excludes non-GST goods and services) is actually even higher and is about 60% of GDP.

Meanwhile, the survey warned about some of the factors could have a dampening impact on GDP growth in the upcoming year are like the possibility of a hike in crude oil prices in the global market.

The Finance Minister presented the Economic Survey 2017-2018 in both houses of the parliament on Monday following President Ram Nath Kovind’s address.

Jailtey laid a copy in Hindi and English of the Economy Survey 2017-18 (Volume 1 and Volume 2).

After tabling the survey, Lok Sabha and Rajya Sabha adjourned for the day.

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