Economic Survey – 2021-22
By Venkatesh Raghavan
After being forced to rollback its farm law reforms, the Economic Survey 2021-22 report that gets tabled ahead of the Union Budget in Parliament, ironically stresses on facilitating enhanced private investment in the agricultural sector.
The current level of private investment in the agricultural sector stands at 2 to 3 percent. The survey however was optimistic of registering upward of 8.5 percent growth in the forthcoming financial year.
The emphasis laid on capital investment for the agricultural sector was voiced by Chief Economic Advisor (CEA) V Anantha Nageswaran. He said with a boost in the capital outlay for the agricultural sector, the growth rate will accelerate at a quicker pace.
The government was also upbeat about India wresting the tab of world’s fastest growing economy from China. The government said with the stimulus packages for MSME and other vulnerable sectors, there is enough scope for increased spending power coming into play.
Besides, there are adequate reforms intended to stabilize and ease the supply chain. Consequently, the farming sector which grew at 3.6 percent, is expected to cross the 3.9 percent mark.
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The optimism exuded by the finance minister is subject to assumptions that there would be no further pandemic related disruptions, normal monsoons besides, orderly method of liquidity withdrawal on part of the central bankers.
Besides, the world crude oil prices were also surmised to stabilize between $70 to $75 per barrel as compared to the current $90 per barrel.
However, pegging down on retail inflation to adjust within the current rate of interest will be a matter of major concern.
Dwelling on the credit guarantee scheme that is intended to come to the rescue of MSMEs, Chief Economic Advisor Dr. V. Anantha Nageswaran spelt out a corpus of over INR 4.5 lakhs crores was earmarked for this purpose. Discussing money matters, he also dwelt on the successful disinvestment of our international carrier Air India.
The other indicators that spoke of a robust financial status were increase in monthly GST collections, increase in profits of private firms and also an upward swing in the share prices.
Money markets though not a sure shot indicator of financial health, serve to reflect on the buoyancy of the investor sentiment.
The Economic Survey that was tabled in Parliament today, summarized its optimism, stating, “India has enough leg space to drive on its spending capacity. By 2023, we will be able to comfortably cross the targets we have set for ourselves.”
