India’s Economic Survey for 2012-13 pegs the country’s growth at 6.1-6.7% and inflation at 6.2-6.6% for the next fiscal 2013-14 and made a strong call for cutting subsidies.
Following are the major Highlights of the Economic Survey 2012-13:
- GDP growth seen at 6.1-6.7 percent in 2013/14
- Government target for fiscal deficit is 4.8 pct of GDP in 2013/14
- Government target for fiscal deficit is 3 pct of GDP in 2016/17
- Headline WPI inflation may decline to 6.2-6.6 pct by March2013
- Focus on curbing imports, making oil prices more market determined to foreign in current account deficit
- Foreign Institutional Investors (FIIs) flows need to be targeted towards long-term rupee instruments
- Prioritisation of expenditure seen as key ingredient of credible medium-term fiscal consolidation plan
- Raising tax to GDP ratio to more than 11 percent seen as critical for sustaining fiscal consolidation
- Room for accommodative monetary policy with expected fiscal consolidation
- India likely to meet fiscal deficit target of 5.3 pct of GDP in 2012/13, despite significant shortfall in revenues
- Recommends curbing gold imports to reign in current account deficit
Room to increase exports in the short run limited
- Industrial output seen growing around 3 pct in 2012/13
- Govt priority to fight inflation by reducing fiscal impetus to demand as well as by focusing on incentivizing food production.
- More jobs in low productivity construction sector
- Balance of Payments under pressure with net exports decline
- Service sector has shown more resilience despite global slowdown
- Pitches for hike in price of diesel and LPG to cut subsidy burden
- Railway freight grows by 5.1 per cent in 2012-13
- Foreign Exchange reserves remains steady at USD 295.6 Billion at December 2012 end.