Economic Survey is an annual commentary on the state of the economy of India which is put together by Finance Ministry of India. It is a document which presents economic development during the course of the year.
- The draft of the survey is prepared by Department of Economic Affairs and cleared by Chief economic Advisor and the secretary Economic Affairs.
- The final version is vetted by Finance secretary and Finance Minister.
Economic survey is presented every year shortly before presenting the Union Budget of Govt. of India. Economic Survey 2011-12 was presented by finance minister Pranab Mukherjee in Parliament on March 15, 2012. Here is a quick summary for all aspirants of all examinations.
India's Economic Growth
- 6.9 per cent in the Fiscal 2011-12
- 7.6 percent (plus or minus 0.25 percent) in 2012-13
- 8.6 percent in 2013-14.
Growth in Agriculture
- 2.5 % in Fiscal year 2011-12.
Share of Agriculture, allied activities in GDP
- 13.9 % in FY 12
Production of food grains
- 250.42 million tones (FY 12)
Food grains stocks
- 55.2 million tonnes
Growth in Service Industry
- 9.4 %, in FY 12 (and its share in GDP stands at 59%).
- To be 4-5% in FY 13
Central spending on social services
- 18.5% in FY 12 (It was 13.4% FY 07)
Coverage of MGNREGA
- 5.49 Crore household (by 2011-12)
Gross capital formation in Q3 of FY 12 as a ratio of GDP
- 30% (it was 32% in FY 11)
Balance of Payments
- USD 32.8 Billion in first half of FY 12 (It was USD 29.6 Billion in FY 11)
India's Forex Reserves
- USD 293 Billion, it was USD 305 Billion in March 2011 & USD 279 Billion in March 2010
- Expected to moderate at 6.5-7% by March end
Employment in Industry
- 21.9% in 2009-10 (in comparison to 16.2% in 1999-2000). Growth mainly due to construction sector.
Growth in Basic goods and non-durables
Gross Capital Formation in industry
- 48.3% of overall GCF moderated in FY 11
Decline in Manufacturing GCF growth rate
- 7% in FY 11 Vs 42% in FY 10
Share of services in GDP
- 56.3% in FY 12 (it was 55.1% in FY 11)
Share of Financial & non-financial services, IT, Telecom, Real Estate in Total FDI inflows
- 41.9 % (during April 2000-December 2011)
Growth in trade, hotels and restaurants
Growth in FDI inflows in FY 12 (April-Dec)
- 36.8 % (stands at USD 9.3 billion)
Growth in India's Exports (April 2011 - Jan 2012)
- 23.5% (stands at USD 242.8 Billion)
Growth in India's Imports (April 2011 - Jan 2012)
- 29.4% (stands at USD 391.5 Billion)
India's Largest Trading Partner
- United Arab Emirates (followed by China)
Growth in India's Service Exports
- 17.1 & in H1 of FY 12 (It was 38.4 % @ USD 132.9 Billion in FY 11)
Top performing Sectors in Export
- Petroleum and oil products, gems and jewellery, engineering, cotton fabrics, electronics, readymade garments, drugs
Top performing Sectors in Import
- POL (petroleum, oil and lubricant), gold and silver.
External Debt Stock
- USD 326 Billion
Net capital flows
- USD 41.1 billion
Share of Net Capital Flows in GDP
- 4.5% (in the H1 of FY 12)
External commercial borrowing
- USD 10.6 billion (in H1 of FY 12)
Trade Deficit as part of GDP
- More than 8%
Current Account Deficit as part of GDP
- 3% (these two figures hint imbalance that is growing)
Fall in Rupee against dollar
- 12.4 % (From 44.97 per USD in March 2011 to 51.34 per USD in January 2012)
Total Investment in SEZ
- Rs. 2,49,630.80 crore (31 Dec. 2011)
Number of Approved SEZ
- 583 (out of them 380 notified)
Growth in Priority Sector Landing
Share of Computerised banks among all banks
Capital infused in public sector banks in 2012
- Rs. 12,000 Crore
Growth in bank credit extended by Scheduled Commercial Banks
- Survey is optimistic about the fiscal consolidation and says that fiscal consolidation is likely to get back on track from 2012-13, when savings and capital formation will also begin to improve.
- High priority to Sustainable development and climate. Incorporates a new chapter this year.
- Global economic environment turns adverse since September 2011 due to Euro-zone crisis.
- Indian Economy slows down due to global as well as domestic factors.
- Recovery is slow , reason for slow recovery is decline in overall investment rate.
- Global economy seems to remain fragile.
- G-20 should make more efforts for global financial stability.
- India gets more closely integrated with the world economy
- India's foreign trade performance remained key driver of growth.
- Share of trade to GDP (of goods and services) in world tripled in 20 years (1990-2010).
- Inflation expected to moderate.
- Gap between WPI and CPI inflation narrows.
- Consumption pattern main driver of food price inflation. Milk, eggs/meat/fish, gram & edible oils responsible.
- Monetary market remained orderly. RBI addressed the liquidity concerns of markets
- There are threats from asset price bubbles in real estate and stock markets
- Oild prices threat inflationary pressures.
- India has high level of food stocks , which shall help maintain overall price stability
- Industrial growth less than recent past and far below potential.
- Industrial sector expected to rebound during next financial year with inflation easing, moderation in commodities prices in international market and revival of manufacturing performance
- Contraction in production in the mining sector, particularly in coal and natural gas segments, improvement in electicity.
- Moderation in growth in other segments of IIP, Negative growth in capital goods and intermediates segment, Moderation in rate of growth of credit in infrastructure and manufacturing sectors.
- Services sector proves saviour during global crisis and hero of Economic Growth. It has slight moderation though, due to the steep fall in growth of public administration and defence services reflecting fiscal consolidation.
- India's Software service exports steady and face threat from Eurozone.
- Negative growth in Coal, Natural Gas, Fertilizers, handling of Export Cargo at airports and number of cell phone connections
- Low growth in steel.
- Credit growth to infrastructure sector turned negative
- There has been reduction in credit flow in power and telecom sectors.
- Foreign funding to remain sluggish. Equity and currency markets remained under pressure.
- Indian Banks have Robust fundamentals.
- Banking may become a risky business, thanks to global integration.
- Credit Disbursement to agro sector exceeded target by 19 %, 12.7 Million new farmers got farm credits.
- Self Help Group- bank linkage programme gets thumping success.
- Climate change, food security, water security, energy security and managing urbanization are main challenges.
Recommendations: Inflation & Monetary Policy:
- Progressive deregulation of interest rates on savings accounts . Deregulation of interest rates on savings accounts to help raise financial savings and improve transmission of monetary policy.
- Domestic financial markets, especially corporate bond markets need deepening.
- There should be more efforts to attract dedicated infrastructure funds.
- There should be renewed focus on supply side measures essential for price stability
- There should be substantial Monetary policy challenge to rein-in inflation.
- There is a need to examine linkages between policy rate changes and inflation.
- There are threats from asset price bubbles in real estate and stock markets. To address them, RBI should further sharpen monetary policy.
- Government should take measures for guiding farmers on fertilizers, insecticide, alternate cropping patterns, for price stability in food items.
- There should be regular imports of agriculture commodities in smaller quantities for price control.
- There should be special markets for special crops.
- Mandi Governance needs to be improved; interstate trade in agro commodities should be promoted.
- Perishable food items should be taken out of ambit of the APMC Act
- Survey thumbs up the FDI in multi brand retain , says it will fill infrastructure gap during harvest period
- Modern store facilities need to created for food grains.
- There should be adequate investment in R&D in Agriculture.
Recommendations: Industry , Infrastructure & Exports
- Business sentiments should be boosted. There should be encouragement to investments and identify and wipe-out bottlenecks.
- Land acquisition and infrastructure issued should be dealt on priority basis.
- Real estate ownership of dwellings and business services segment are worrisome segments.
- There should be further diversification of India's export basket.
- The procedural delays and red tape should be addresses to facilitate trade.
- Infrastructural bottlenecks need to be removed
- There is a need to attract large scale investment into infrastructure, looking at investment requirement at USD 1 trillion during Twelfth Plan.
- PPP has been a successful model, should be promoted in Infra segment.
- Sustainable levels of external debt should be maintained.
- Government should take innovative steps to bring corporate bond market at the centre stage. Government should promote the infrastructure financing and financing of unorganized micro/small business sectors.
Recommendations: Climate Change
- Low carbon growth should be central element of 12th Five Year plan.
- India's per capita CO2 emissions much lower than those of developed countries, world needs more sensitivity from developed countries to carbon emissions.