The Economy Survey 2011-12 was tabled by the Finance Minister Pranab Mukherjee in the Parliament on March 15, 2012.
Following are the highlights of Survey, a report card of the Indian economic scenario for current fiscal:
—The country’s economic growth estimated at 6.9 per cent in the current fiscal; growth momentum to pick up in next two fiscals to 7.6 per cent 2012-13 and 8.6 per cent in 2013-14.
—RBI expected to lower policy interest rates, as inflationary pressures expected to ease in coming months; A low interest rate regime to encourage investment activity and push forward economic growth.
—Steps required for deepening of domestic financial markets, especially corporate bond market and attracting longer-term inflows from abroad; Efforts at attracting dedicated infrastructure funds have begun.
—The growth rate of investment in the economy is estimated to have declined significantly; borrowing costs up due to a sharp increase in interest rates.
—High borrowing costs and increase in other costs affecting profitability and internal accruals.
—Slowdown in Indian economy largely due to global factors, as also because of domestic factors like tightening of monetary policy, high inflation and slower investment and industrial activities.
—Inflation high, but showing clear signs of slowdown by the year-end; Whole-sale food inflation down to 1.6 per cent in January 2012 from 20.2 per cent in February 2010.
—India remains one of the fastest growing economies of the world; Country’s sovereign credit rating rose by a substantial 2.98 per cent 2007-12.
—Exports grew by 40.5 per cent in the first half of this fiscal and imports grew by 30.4 per cent; Foreign trade performance to remain key driver of growth.
—Forex reserves expanded further, covering almost the entire external debt stock to the country.
—Foodgrains production likely to cross 250.42 million tonnes; largely on back of increase in rice production.
—Agriculture and Services sectors expected to perform well; Industrial growth pegged at 4-5 per cent and expected to improve further as economic recovery resumes.
—Global economy remains fragile and concerted efforts needed to restore stability and renewed growth; Steps needed for sovereign debt crisis, financial regulation, growth and job creation efforts and energy security, globally.
—India much more closely integrated with world economy’ share of trade to GDP of goods and services has tripled in 1990-2010.
—A progressive deregulation of interest rates on savings accounts to help raise financial savings and improve transmission of monetary policy.
—Sustainable development and climate change becoming central areas of global concern and India too is equally concerned and engaged constructively in global negotiations.
—FDI in multi-brand retail can come into effect in a “phased” manner, beginning from metropolitan cities. The survey said that allowing foreign direct investment in multi-brand retail is one of the major issues in the services sector, but the move would address problems relating to food inflation.
—Notwithstanding lower growth of domestic steel consumption during the first three quarters of the current fiscal, the overall performance of the sector is “optimistic”. The survey points out a list of bottlenecks responsible for lower steel consumption, including high inflationary pressure within, deteriorating global economy, multiple hikes in interest rates by the Reserve Bank of India.
—Rate of growth estimated to be 6.9% in FY 12.
—Real GDP growth expected at 7.6% in FY 13.
—GDP pegged at 8.6% in FY 14.
—Agriculture grows at 2.5 % growth in FY 12.
—Services grow at 9.4 %, in FY 12, share in GDP at 59%.
—Industrial growth pegged at 4-5 % in FY 13.
—WPI food inflation dropped from 20.2% in February 2010 to 1.6% in January 2012.
—India’s sovereign credit rating rose by 2.98 percent in 2007-12.
—Central spending on social services up at 18.5% in FY 12 Vs 13.4% FY 07.
—Gross capital formation in Q3 of FY 12 as a ratio of GDP at 30%, down from 32% in FY 11.
—Balance of Payments widens to USD 32.8 bn in H1 of FY 12 Vs USD 29.6 bn FY 11.
—Forex reserves up from USD 279 bn in March ’10 to US USD 305 bn in March 11.
—India’s share of trade to GDP of goods and services in world tripled in 1990-2010.
—FDI in multi-brand retail recommended.
—Agriculture, allied activities account for 13.9 % of GDP in FY 12.
—Foodgrains stocks at 55.2 million tonnes.
—Production of foodgrains in FY 12 estimated at 250.42 million tones.
—Industrial growth pegged at 4-5% in FY 12.
—Employment in Industry increase from 16.2% in 1999-2000 to 21.9% in 2009-10 largely due to construction sector.
—Services grow by 9.4% despite slowing GDP growth.
—Share of services in GDP at increased from 55.1% in FY 11 to 56.3% in FY 12.
—India’s exports grew at 23.5% to reach USD 242.8 bn in April 2011 – Jan 2012.
—Imports up 29.4% during April – Jan 2011-12 at USD 391.5 bn.
—Key import areas: petroleum, oil and lubricant, gold and silver.
—UAE India’s largest trading partner, followed by China.
—Total FDI inflows into major infrastructure sectors during April-December 2011 registered growth of 23.6%.
—Rupee falls by 12.4 % against USD. Rupee’s high volatility impairs investor confidence.
—Public sector banks show 19 % growth in priority sector lending.
—Credit Disbursement to agriculture sector exceeded target by 19 %.
—98 % public sector bank branches fully computerised.
—Number of out-of-school children down from 134.6 lakh in 2005 to 81.5 lakh in 2009.
—Share of women in organized-sector employment at 20.4% in 2010 March end.
—MGNREGA: Coverage increases to 5.49 crore households in 2010-11.