Union Minister of Finance Arun Jaitley on Tuesday tabled the Economic Survey in the Lok Sabha. Here are the highlights:
GDP growth for next fiscal pegged at 6.75-7.5 pc
Growth this fiscal to be 6.5 pc
Prescribes cut in individual I-T rates, real estate stamp duties
Income Tax net could be widened gradually by encompassing all high income earners
Time table for cutting corporate tax should be accelerated
Tax administration could be improved to reduce discretion and improve accountability
Growth to return to normal as new currency comes in circulation
Demonetisation to affect growth rate by 0.25-0.5 pc, but to have long-term benefits
GST, other structural reforms should take the trend growth rate to 8-10 pc
Fiscal windfall likely from Pradhan Mantri Garib Kalyan Yojana, low oil price
Farm sector to grow at 4.1% this fiscal, up from 1.2% last year
Fiscal gains from GST will take time to realise
Demonetisation may affect supplies of certain agricultural products like sugar, milk, potatoes and onions
Growth rate of industrial sector to moderate to 5.2% this fiscal, from 7.4% last fiscal
Efforts to collect taxes on disclosed and undisclosed wealth should not lead to tax harassment
Universal Basic Income Scheme is an alternative to a plethora of state subsidies for poverty alleviation.
Swachh Bharat to promote a broader fundamental right to privacy for women.
Service sector estimated to grow at 8.9% in 2016-17.
Later, Chief Economic Advisor Arvind Subramanian in his media after tabling of the Economic Survey said that the document aims to provide objective analysis. Here are some of the highlights from his address that by and large focussed on Demonetisation:
The past year has had robust macroeconomic stability.
Demonetisation has actually affected different forms of money very differently.
What demonetisation has done is both simultaneously reduced supply of cash, but by the same token it has increased supply of deposits. Currency squeeze was less severe than perceived.
Aim of demonetisation is to bring down real estate prices.
Bank credit affected by demonetisation seems like it has come down. Overall picture is mixed.
Not appropriate to do a before-after analysis of GDP growth, with respect to demonetisation.
Demonetisation has short term costs, potential long term benefits.
Balance sheet of banks and private sector still challenged; much of debt is in large companies.
External challenges include rise in oil prices and protectionism.
(With agency inputs)