Economic Survey likely to forecast 2020/21 growth at 6-6.5%, CEA K Subramanian to officially announce details today: Report

The Economic Survey by chief economic adviser (CEA) Krishnamurthy Subramanian will be officially announced later in the day and the government will present its Budget on Saturday.

FP Staff January 31, 2020 10:30:42 IST
Economic Survey likely to forecast 2020/21 growth at 6-6.5%, CEA K Subramanian to officially announce details today: Report
  • The government has estimated GDP expansion at 5% for the financial year ending on 31 March

  • India faces its worst economic slowdown in a decade

  • Growth slipped to 4.5 percent in the July-September quarter, imperiling job prospects for millions of young people entering the workforce each year

The country's growth is expected to be projected between 6 percent and 6.5 percent for the financial year 2020-21 in the Economic Survey, boosted by a series of fiscal measures to revive demand that the government is likely to announce in the Budget, said news reports on Friday. This gives positive signals at a time when the economic slowdown has gripped the country for the past nearly one year.

The Economic Survey 2020, which will be tabled in both the houses of the Parliament on Friday, is expected to call for ‘Assemble In India For The World’. The survey may also lay stress on the need for specialisation in labour intensive manufacturing sectors, said a report in CNBC TV18.

The survey will highlight weak global growth, financial sector issues for slowdown and caution on impact of price control along with questioning effectiveness, the report said quoting sources.

Economic Survey likely to forecast 202021 growth at 665 CEA K Subramanian to officially announce details today Report

File image of Chief Economic Adviser KV Subramanian. PTI

India faces its worst economic slowdown in a decade. Growth slipped to 4.5 percent in the July-September quarter, imperiling job prospects for millions of young people entering the workforce each year, reported Reuters.

The government has estimated Gross Domestic Product (GDP) expansion at 5 percent for the financial year ending on 31 March, which would be the slowest pace since the global financial crisis of 2008/09.

Chief economic adviser (CEA) Krishnamurthy Subramanian will officially announce the Economic Survey later in the day and the government will present its Budget on Saturday.

The budget session of Parliament starts on Friday with President Ram Nath Kovind's address to the join sitting of Lok Sabha and Rajya Sabha. He will deliver a speech in the Central Hall of Parliament at 11 am. Vice President Venkaiah Naidu will also chair a meeting of floor leaders of Rajya Sabha at his residence today.

All eyes will be on the Economic Survey for the current fiscal, which is a detailed report card on the economic performance throughout the year.

FICCI projects FY20 GDP growth at 5% 

Meanwhile, industry body Federation of Indian Chambers of Commerce and Industry (FICCI) on Wednesday said its Economic Outlook Survey has projected the country's annual median Gross Domestic Product (GDP) growth for 2019-20 at 5 percent, in line with the projections made by the National Statistical Organisation (NSO), reported PTI.

The survey has put the median growth forecast for agriculture and allied activities at 2.6 percent for 2019-20, the industry and services sector at 3.5 percent and 7.2 percent, respectively, during the current year.

"Growth is likely to improve to 5.5 percent in 2020-21 as per the projections," the survey said.

Further as per the survey, the economic growth has been pegged at 4.7 percent for the third quarter of 2019-20.

The survey was conducted during December and January 2019-20 amongst economists belonging to the industry, banking and financial services sector, FICCI said.

As per the first advance estimates of the national income released by the NSO, India's GDP growth is seen dipping to an 11-year low of 5 percent in the current fiscal, mainly due to poor showing by manufacturing and construction sectors.

The survey further said concerns remain on external front with exports projected to contract in 2019-20.

Merchandise exports are expected to decline by 2.1 percent, while imports are expected to decline 5.5 percent during the year, it said.

Moreover, median current account deficit forecast was pegged at 1.4 percent of GDP for 2019-20.

Economic Survey likely to forecast 202021 growth at 665 CEA K Subramanian to officially announce details today Report

"Moderation in global growth forecast, escalating geo-political tensions, and uncertainty around trade deal between US-China and BREXIT outcome still form major risk factors to India's growth in 2020," it said.

Participating economists said that a shortfall in government's revenue collections seems imminent this year on the back of lower than anticipated nominal growth.

To augment government's revenue collections, they called for measures to boost the country's nominal GDP growth.

Citing weak consumption demand as a major impediment to India's growth, economists cautioned against any changes in the GST rates to improve revenue collections as it would prove to be counterproductive, Ficci said.

Economists recommended undertaking expansionary fiscal and monetary policies along with a slew of reforms to tackle the structural problems facing the economy.

With PTI inputs

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