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Economic Survey 2013-14: GDP growth in FY 15 seen at 5.4-5.9 per cent
The Economic Survey 2013-14 was tabled in Parliament today, a day before the Union Budget 2014-15. The survey says that India's economy is expected to grow between 5.4 per cent and 5.9 per cent in the current fiscal year.

The survey also lists the downside risk factors like poor monsoon, the external environment and the poor investment climate. The survey also talked about the measures taken by the government to improve investment climate and improve governance which could could push up growth to 7-8 per cent in the coming years.

The GDP growth has slowed down to decade's low of 4.5 percent in 2012-13 and it picked a little to 4.7 per cent in 2013-14. Here are few highlights of the economic survey 2013-14:

Inflation:

  • Inflation limits scope for RBI to cut rates

  • Moderation in inflation to help ease monetary policy

  • Monetary policy essential for long run inflation control

  • Need to bring down inflation

  • Need to bring down inflation in a caliberated manner

Growth:

  • Economy can look forward to better growth prospect in FY 15

  • There are concerns over El Nino emergence this year

Reforms:

  • Need to expand decentralized procurement for PDS

  • Subsidy reforms essential to fiscal consolidation

  • Need to go for cash transfer of subsidy

  • Subsidy reforms essential to fiscal consolidation

Agriculture:

  • Record food grains production of 264.4 mt in the year 2013-14

  • Record production of oil seeds of 32.4 mt in the year 2013-14

  • Agriculture sector growth rate 4.7% in the year 2013-14

  • Agriculture exports grow by 5.1% in the year 2013-14

Industrial Performance:

  • Industry grew by just 1.0 percent in 2012-13 and slowed further in 2013-14, posting a modest increase of 0.4 percent.

Services:

  • India ranked 12th in terms of services GDP among the world's top 15 countries

  • Financing, insurance, real estate, and business services grew robustly at 12.9 percent

Fiscal health:

  • Fiscal consolidations remains imperative for the economy, says the Economic Survey

  • Economy Survey recommends fiscal consolidation through higher tax-GDP ratio then merely reducing the expenditure to GDP ratio

  • The growth rate of the combined category of trade, hotels, restaurants, transport, storage, and communications decelerated to 3.0 per cent

Other Highlights:

  • See improvement in manufacturing, balance of payment in FY 15

  • Raising tax GDP ratio key to fiscal consolidation

  • Fiscal consolidation remains imperative for economy

  • Industrial growth likely to revive in next 2 years

  • Improved twin deficit may lead to gradual growth

  • FY 15 current account deficit may be limited to 2.1 percent of GDP

  • Exports grew by 4.1per cent over negative growth of 1.8 per cent in 2012-13

Commenting on the Economic Survey, D S Rawat, Secretary General of industry body ASSOCHAM, expressed hopes that the concerns highlighted in Economic Survey are addressed by the FM in Budget tomorrow. 

"The candid admission of the fiscal situation of the central government being in 'worse situation than it appears' in the Economic Survey which underscores the need for the FRBM Act with teeth is laudable, but the key is held by the intent and resoluteness of the Government to really walk the talk," said DS Rawat. 

He also added, "Once again the problems facing the economy have been well reiterated by the Economic Survey. We hope that some of the concerns and priorities highlighted by the Survey like controlling fiscal deficit, better subsidy targeting and focus on infrastructure and manufacturing are addressed right away in the Budget to be presented by Finance Minister, Arun Jaitley tomorrow."

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