New Delhi: India’s economic growth will rebound from a five-year low this year, but would need a boost in spending and reforms to accelerate higher rate of expansion to double the economy’s size to $5 trillion by 2024-25, the pre-Budget Economic Survey said Thursday.
Stepping up private investments, exports and job creation will be key to achieving the target, the survey presented in Parliament by Finance Minister Nirmala Sitharaman said.
The real gross domestic product (GDP) growth, which slowed to a five-year of 5.8 per cent in the first three months of 2019 – well below China’s 6.4 per cent, is expected to rise to 7 per cent in 2019-20 fiscal that started in April, it said. GDP growth was 6.8 per cent in 2018-19, down from 7.2 per cent in 2017-18.
Investment rate, which was declining since 2011-12, seems to have bottomed out and is expected to pick up in consumer demand and bank lending, the survey said adding economic slowdown impacting tax collections and rising state expenditure on farm sector may, however, put strains on the fiscal front.
India is currently the sixth-largest economy in the world with a size of USD2.7 trillion. It is expected to overtake Britain to become the fifth-largest next year.
Authored by Chief Economic Adviser Krishnamurthy Subramanian, the Economic Survey said investment (especially private), is the key driver that boosts demand, creates capacity, increases labour productivity, introduces new technology, allows creative destruction and generates jobs.
At a media briefing, he said structural reforms such as ones in the labour sector are needed to bring in the much-needed private investment. Also, micro, small and medium enterprises (MSME) sector needs focus as the bulk of the job creation and growth support would come from this segment.
The survey put fiscal deficit for 2018-19 at 3.4 per cent, but analysts expected a short-term realignment of the fiscal consolidation map with the deficit targets being marginally raised for the current fiscal in the Union Budget for 2019-20 to be presented by Sitharaman Friday.
State’s population growth 10.3 pc
The Economic Survey 2018-19 released by the Ministry of Finance Thursday projected a population growth of 10.3 per cent in Odisha during 2021-41, a two per cent less than national growth. According to the survey, Odisha’s population will be 45.4 million in 2021, 48.2 million in 2031 and 50.1 million in 2041. The survey has projected a population growth in the country at 12.1 per cent during 2021-41. It further stated that the country’s population in 2041 would be 1510.2 million. It further projected that around 13.7 million people in 2031 and 13.1 million in 2041 would lie in the age group of 0-19 years while 28.1 million in 2031 and 28.7 million in 2041 would be in the age group of 20-59 years and 6.5 million in 2031 and 8.3 million in 2041 would be in the age group of 60 years and above. Similarly, the survey also suggested need for appointment of additional judges in subordinate courts in view of huge pendency of cases. The state has been seen as worst performer in terms of clearing pending cases in the district and subordinate courts as the national average time taken by such courts is five years. According to the survey, the average number of years of pending civil cases is over four years while criminal cases is more than five years in district and subordinate courts in the state. The survey reveals that Odisha, Bihar, West Bengal, Uttar Pradesh and Gujarat have higher average rate of pendency of civil and criminal cases as compared to the national average of four years whereas Punjab and Delhi have the least average pendency of cases.
