NE BUSINESS BUREAU
NEW DELHI, JULY 22
The short-term inflation outlook for India is benign, and the expectation of a normal monsoon and moderating global prices of key imported items give credence to the projections made by the Reserve Bank of India (RBI) and the Internatioanl Monetary Fund (IMF), the Economic Survey said on Monday.
The Economic Survey highlights the prevailing strengths of our economy and also showcases the outcomes of the various reforms our Government has brought.
It also identifies areas for further growth and progress as we move towards building a Viksit Bharat.…
— Narendra Modi (@narendramodi) July 22, 2024
However, to ensure long-term policy stability, the Survey 2023-24 suggested making focused efforts to increase the production of major oilseeds, expanding the area under pulses, and assess the progress in developing modern storage facilities for specific crops.
- Also suggested linking of price monitoring data for essential food items to help monitor and quantify the build-up of prices at each stage
- GDP is lower than 8.2 per cent estimated for the previous financial year
The Economic Survey 2023-24, tabled in Parliament by Finance Minister Nirmala Sitharaman, also suggested linking of price monitoring data for essential food items collected by different departments to help monitor and quantify the build-up of prices at each stage from the farm gate to the final consumer.
“The ongoing efforts to construct the producer price index for goods and services may be expedited to have a greater grasp of episodes of cost-push inflation,” said the Survey authored by a team of economists led by Chief Economic Adviser V Anantha Nageswaran. It also prescribed expeditiously revising the consumer price index with fresh weights and item baskets.
In 2023, India’s inflation rate was within its target range of 2 to 6 per cent. Compared to advanced economies like the USA, Germany, and France, India had one of the lowest deviations from its inflation target in the triennial average inflation from 2021-2023, the Survey said.
India successfully managed to keep retail inflation at 5.4 per cent in FY24, the lowest level since the Covid-19 pandemic period. Retail inflation in June rose to four months high of 5.1 per cent. Also, wholesale inflation stood at 3.36 per cent in the month on account of rise in prices of food articles, especially vegetables and manufactured items.
India GDP to grow at 6.5% to 7% this fiscal
The GDP of India is expected to grow at 6.5 to 7 per cent in FY24-25, according to the Economic Survey 2023-24 tabled by Union Finance Minister in the Parliament on Monday. This is lower than the economic growth rate of 8.2 per cent estimated for the previous financial year.
“…the Survey conservatively projects a real GDP growth of 6.57 per cent, with risks evenly balanced, cognizant of the fact that the market expectations are on the higher side,” said the document tabled by Finance Minister Nirmala Sitharaman in Parliament.
The survey takes into account global challenges which is likely to impact exports. The RBI projections shows that GDP growth will at 7.2 per cent this fiscal while international entities including IMF and ADB pins the growth at 7 per cent.
The economic survey pointed out that despite uncertain global economic performance, the domestic growth drivers had an impact on economic growth in 2023-24, adding that improved balance sheets will help the private sector cater to strong investment demand.
It also warned that after good growth in the last three years, private capital formation may turn slightly more cautious because of fears of cheaper imports from countries that have excess capacity.
