India is likely to clock 7-7.5% growth rate in 2018-19, up from 6.75% in the current financial year, and regain the world's fastest growing major economy tag, the Economic Survey 2017-18 predicted on Monday.
India is likely to clock 7-7.5% growth rate in 2018-19, up from 6.75% in the current financial year, and regain the world's fastest growing major economy tag, the Economic Survey 2017-18 predicted on Monday.
The GDP growth, said the survey, has averaged 7.3% from 2014-15 to 2017-18, making it the highest among major economies of the world.
"That this growth has been achieved in a milieu of lower inflation, improved current account balance and notable reduction in the fiscal deficit to GDP ratio makes it all the more creditable," said the annual survey that is regarded as the report card of the economy.
The services sector has turned out to be a key contributor. Even as oil prices have crept up, inflation was on average at a 6-year low of 3.3% in 2017-18.
In a first, the survey document was wrapped in a pink cover in order to show the government's commitment and solidarity to women empowerment and equal rights. Explaining its significance, chief economic adviser Arvind Subramanian said, "In our bid to further the cause of women's empowerment, the cover of Economic Survey is pink."
The survey has highlighted that India has lower women participation in the labour force, adversely affecting the "growth potential of the economy".
Most Indian families are keen on having male children over girls and that has created 21 million "unwanted girls". The survey pointed out that Indian parents keep producing children till they have the "desired number of sons". It has highlighted that the sex ratio of last birth in the country has come down barely from 39.4% in 2005-06 to 39% in 2015-16.
The survey also pointed out that the number of women earning a living has seen no change in 10 years between 2005-06 and 2015-16, with only 24% of women actively employed in 2015 -16 as compared to 36% in 2005-06. However, there has been a considerable improvement in areas such as decision making regarding household purchases, visiting family and others, according to the survey. It said the government's schemes such as Beti Bachao, Beti Padhao and Sukanya Samridhi Yojana schemes, and mandatory maternity leave rules are all steps in the right direction.
"The growth in the economy is picking up robustly as temporary impact of demonetization and Goods and Services Tax (GST) has been decimated," said the CEA.
"The government doesn't have to do anything new or radical. They should finish what they started out. They should stabilise the GST. Privatise Air India. Head off macro-economic pressures and possibility of a sudden stall from rising oil prices and sharp correction is stock prices," he said.
Hitesh D Gajaria, partner, KPMG in India, said, "Given that the survey identifies private investments and exports as the two truly sustainable engines for rapid economic growth, one can expect measures on rationalisation of tax rates in the upcoming Budget. The survey also acknowledges that there is substantial avoidable litigation in the tax arena which the government action can reduce. This raises hopes for positive measures to alleviate this situation being proposed as well."
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