India’s Chief Economic Adviser Arvind Subramanian presented the Economic Survey on Monday, on the first day of the Budget Session. The Economic Survey is an annual report written by the chief economic adviser that lays out the state of the country’s economy days before the finance minister introduces the Budget.
Finance Minister Arun Jaitley tabled the first volume of the Economic Survey for 2017-’18 in the Lok Sabha, three days ahead of the Union Budget.
Subramanian’s assessment this year said the Indian economy is likely to grow at 6.75% in 2017-’18 and accelerate to 7% to 7.5% in 2018-’19. While presenting the Economic Survey, he explained why he believes the Indian economy decoupled from the global economy. He noted that the Goods and Services Tax and demonetisation had both affected growth, but emphasised that their impacts had faded.
Here’s how Subramanian presented the Economic Survey:
2.30 pm: India got its sovereign rating upgraded for the first time in 14 years, Subramanian says.
2.20 pm: He says that rising oil prices are a challenge for the economy.
2.15 pm: Subramanian begins to take questions from reporters at the press conference.
2.12 pm: “The GST Council has shown that cooperative federalism can really work,” he says. He says the two are a “how-to of reform going forward”. “We’ve moved, over last 50 to 60 years, from crony socialism to stigmatised capitalism,” he says.
2.10 pm: India’s investment slowdown is of the balance sheet type, and thus more difficult to reverse,” he says. “The government’s urgent steps to tackle the twin balance sheet challenge and improving the ease of doing business will reignite animal spirits.”
2.08 pm: He points out the new chapter on gender in the Economic Survey and the first ever chapters on science and technology and pendency in the judiciary in the document.
2.07 pm: In his assessment, the chief economic adviser says India must pay attention to climate change, backlash from globalisation, structural transformation and human capital regression.
2.05 pm: Subramanian says there has been a large increase in voluntary compliance under GST. “About 36% of total GST filers, eligible for composition scheme or could have opted out from GST [below GST threshold], filed regular GST returns in first five months,” he says.
2.02 pm: Markets are misinterpreting the government’s borrowing, he says. “Borrowing Rs 40,000 crore does not reflect the underlying deficit.”
2.01 pm: Subramanian says there was a rise in registered direct and indirect taxpayers.
“There has been a 50% increase in unique indirect taxpayers under the GST vis-a-vis the pre-GST system and an addition of about 1.8 million individual income tax filers since Nov 2016,” the Economic Survey says.
2 pm: In the government’s policy agenda for the year ahead, Subramanian highlights the need to support agriculture, stabilise GST, complete balance sheet actions, finish privatising Air India, head off macro-economic pressures and tackle oil prices, Subramanian says in the Economic Survey presentation.
1.57 pm: Markets are record levels, but interest rates have surged, which raise concerns, he says.
1.57 pm: The economist warns of the impact of oil prices on India’s GDP, and says we must keep a close eye on it.
1.55 pm: Export growth could be greater and private investment could also grow if Insolvency and Bankruptcy Code proceedings progress well, Subramanian says.
1.54 pm: Subramanian points to the Survey and says the impacts of demonetisation and GST had dissipated because of government measures.
1.53 pm: Oil prices also caused the Indian economy to decouple from the world economy, Subramanian says.
1.52 pm: Export and import both decelerated sharply, as did the services sector, the chief economic adviser says, once again highlighting the impact of the GST and demonetisation.
1.50 pm: In order to understand whats going to happen next year, we need to understand what happened in the last four to six quarters, he says. He explains why the Indian economy decoupled from the rest of the world and mentions GST and demonetisation as factors.
1.47 pm: Subramanian mentions the transformative Goods and Services Tax launched in July 2017.
1.46 pm: He says the Survey gives an analytical review of the economy.
1.45 pm: Arvind Subramanian begins a press conference to present the Economic Survey 2018.
1.30 pm: The economic outlook for the upcoming financial year 2018-’19 will be “determined by economic policy in the run-up to the next national election”, the Economic Survey says. “If macro-economic stability is kept under control, the ongoing reforms are stabilised, and the world economy remains buoyant as today, growth could start recovering towards its medium term economic potential of at least 8%,” the survey says.
1.25 pm: The Economic Survey notes that “stabilising” the GST, solving the twin-balance-sheet problem of Indian banks, privatising Air India and “staving off threats to macro-economic stability” should be on the agenda for 2018-’19.
The GST collections slipped to their lowest in November as rates were cut on several goods to make the new single tax regime more acceptable.
12.45 pm: Arun Jaitley tables Economic Survey 2018 in Lok Sabha.