Highlights of India's Economic Survey 2011-2012

The annual Economic Survey which was tabled in Parliament earlier today has stated that India’s economy is likely to pick up pace in 2012-13 and grow 7.6 percent.The finance ministry report also estimated economic growth in the financial year after that at 8.6 percent.

While economic growth faltered to a three-year low of 6.1 percent in the December quarter, GDP growth in the current financial year ending March is expected to dip below 7 percent for the first time in three years.

Here are the highlights of Kaushik Basu’s last economic survey as Chief Economic Adviser:

• The rate of growth this fiscal is estimated to be 6.9 percent. Outlook for growth and stability is promising with real GDP growth expected to pick up to 7.6 percent in 2012-13 and 8.6 percent in 2013-14.

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[caption id=“attachment_245143” align=“alignleft” width=“380” caption=“Industrial growth pegged at 4-5 percent is expected to improve as economic recovery resumes. Reuters”]  [/caption]

• Agriculture and services sectors continue to perform well. A 2.5 percent growth in the agri sector has been forecast and even as the services sector grows by 9.4 percent, its share in GDP goes up to 59 percent.

• Industrial growth pegged at 4-5 percent is expected to improve as economic recovery resumes.

• Inflation on wholesale price index (WPI) was high but showed a clear slow down by the year-end; this is likely to spur investment activities leading to positive impact on growth.

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• WPI food inflation dropped from 20.2 percent in February 2010 to 1.6 percent in January 2012; calibrated steps initiated to rein-in inflation on top priority.

• India remains among the fastest growing economies of the world. The country’s sovereign credit rating rose by a substantial 2.98 percent in 2007-12.

• Fiscal consolidation is on track - savings and capital formation are expected to rise.

• Exports grew at 40.5 percent in the first half of this fiscal and imports grew by 30.4 percent. Foreign trade performance to remain a key driver of growth. Forex reserves enhanced - covering nearly the entire external debt stock.

• Central spending on social services goes up to 18.5 percent this fiscal from 13.4 percent in 2006-07.

• MNREGA coverage increases to 5.49 crore households in 2010-11.

• Sustainable development and climate change concerns on high priority.