Economic Survey Highlights: India should grow at 8%

A day before the Modi government's first Budget in the second term, the government today tabled Economic Survey for the last fiscal year in the Parliament. Finance Minister Nirmala Sitharaman tabled the Survey in the Rajya Sabha an hour before the usual 12 noon time. Laying out a road map for the Modi government's next five years, the new Chief Economic Adviser Krishnamurthy Subramanian in the Economic Survey sees growth to accelerate in the current fiscal. The survey said the economy needs virtuous cycle of savings, investment, exports and growth with investment as the central driver. The former Associate Professor of Finance at the Indian School of Business has presented the Survey at a time when the economy is facing headwinds in manufacturing and agriculture sectors that saw growth rate slowing down to 5-year low.This also comes weeks after Subramanian's predecessor Arvind Subramanian in a research paper claimed that India was overestimating its economic growth rate. Here are the key highlights from the Economic Survey:* Survey sees FY20 GDP growth at 7%, higher growth on stables macros.* India needs to grow at 8% per year to be $5 trillion economy by FY25. Investment key driver to create virtuous cycles.* Green shoots in investment activity seems to taking hold.* Rural wage growth started increasing since mid-2018.* Political stability should push the animal spirits of economy.* Investment rate seems to have bottomed out.* Govt stands by the fiscal consolidation path.* Jan-March economic slowdown due to poll related related activity. * Greenshoots in investment seems to be taking hold.* NBFC stress reason for FY19 slowdown.* Decline in NPAs should push up CAPEX cycle.* General fiscal deficit seen at 5.8% in FY19 VS 6.4% in FY18.* Investment rate seen higher in FY20 on improved demand. * Oil prices seen declining in FY20.*Accomodative MPC policy to help cut real lending rates.

from Economic Times https://ift.tt/309ih1k