This piece is part of’s Hard Times series, which seeks to simplify the Great Indian Slowdown for readers. You can find the rest of the pieces from the series here.

If you read this year’s Economic Survey presented in Parliament on Friday, you might have no idea that the Indian economy is deep in the woods, with no clear path out.

The Survey, an annual document prepared by the Chief Economic Adviser, is meant to provide an accurate picture of the economy as well as offer policy recommendations to the government. It is tabled in Parliament the day before the Finance Minister delivers the annual Budget speech.

This year’s document, prepared by KV Subramanian and his team, begins by harking back to India’s historical greatness: “For more than three-fourths of known economic history, India has been the dominant economic power globally. Such dominance manifested by design,” the first chapter says – citing research about ancient economic numbers that has been questioned by many.

It goes on to reiterate the target set by Prime Minister Narendra Modi after his re-election in 2019, when he said India will become a $5 trillion economy by 2024, even though his ministers have dismissed questions about how this will actually be achieved.

“The Survey posits that India’s aspiration to become a $5 trillion economy depends critically on strengthening the invisible hand of markets together with the hand of trust that can support markets,” the document says.

This theme – strengthening the hand of the market toward wealth creation – animates most of the document, which argues that government intervention has frequently hurt the economy, points out that public sector banks have been a huge drain on natural resources and even calls for food subsidies to be slashed to cover just the bottom 20%.

With a less-than-subtle reference to India’s Nehruvian past, the Survey says that “given India’s tryst with Socialism, skepticism about the benefits of wealth creation is not an accident,” and argues that this needs to change:

“India’s aspiration to become a $5 trillion economy depends critically on promoting pro-business policies that provide equal opportunities for new entrants. The Survey makes the case that the churn create by a healthy pro-business system generates greater wealth than a static pro-crony system. Note that the Survey contrasts two systems; the arguments are not directed at any individual or entity.”

That disclaimer appears to be an attempt to shield the document from allegations that it is a political product. Yet this is belied by its inability to acknowledge the current hole the Indian government finds itself in – Gross Domestic Product growth at 5% or lower, a massive gap in tax collections, a financial system that remains in the doldrums.

One chapter even uses an exclamation mark, and an anonymous epigrah, in an attempt to answer questions raised by the previous Chief Economic Adviser, Arvind Subramanian, who claimed that India’s Gross Domestic Product growth statistics are currently overestimated.

It doesn’t help that the government, on the very same day, said that the GDP growth rate for Financial Year 2018-’19 had been overestimated, revising it down to 6.1% from 6.8% previously. Or that KV Subramaniam’s previous estimation for Financial Year 2019-’20 was originally 7% and is now a whole two percentage points lower at 5%.

Despite the document not pointing clearly at the Great Indian Slowdown, a close read will still bring up information that should alarm you.

The chapter on Public Sector Banks, which occupy a huge part of India’s financial system, point out that “Over Rs 4,30,000 crores of taxpayer money is invested as Government’s equity in PSBs. In 2019, every rupee of taxpayer money invested in PSBs, on average, lost 23 paise.” The subsequent one rings alarm bells about a crisis in the shadow banking sector, with a focus particularly on Housing Finance Companies.

In the second volume, the survey brings up the massive gap between what the government expected to earn in tax revenue over the course of this year and what it will actually bring in, and recommends that the Finance Minister relax the fiscal deficit target for the upcoming year to address this – prompting the markets to drop immediately after.

Subramanian in his press conference later claimed that the economy had “bottomed out” and was now on a recovery path. Despite recent concerns about food prices spiking, the Survey also introduces “Thalinomics”, an examination of the various component prices of ordinary meals to make the point that inflation has mostly remained low.

Maybe the most interesting chapter in the Survey is the one on the failures of government intervention – an argument that was frequently made by many economically right-wing supporters of the Modi government before he became prime minister, but has mostly disappeared because of the BJP’s insistence on following a welfare-heavy policy approach over the last six years.

The chapter – including a translated epigraph that seems to have been copy-pasted from WhatsApp – brings up four instances where government intervention has hurt more than it helps: the Essential Commodities Act’s imposition of stock limits, the regulation of drug prices, government’s foodgrain procurement and debt waivers by states and the Centre.

It makes the argument that “each department and ministry in the Government must systematically examine areas where the Government needlessly intervenes and undermines markets”. Not mentioned in this chapter – though it would have been an extremely appropriate fit – or indeed, in the first volume altogether, is the word “demonetisation”.

Read also:

Bad Apples: An illustrated guide to the Indian banking sector crisis