On investment, the Economic Survey expects that Gross Fixed Capital Formation (GFCF) will see strong growth of 15 percent in 2021-22. It also expects India to achieve full recovery of pre-pandemic level.
“(The) government’s policy thrust on quickening virtuous cycle of growth via Capex and infrastructure spending has increased capital formation in the economy lifting the investment to GDP ratio to about 29.6 percent in 2021-22, the highest in seven years,” as per the Survey.
Finance Minister Nirmala Sitharaman tabled the Economic Survey in the Lok Sabha today. It projects 8-8.5 percent growth in GDP in 2023, noting that India “has fiscal space to ramp up capex”.
Further, FY22 GDP growth seen at 9.2 percent; agricultural growth for FY22 is seen at 3.9 percent and industrial growth at 11.8 percent.
On supply side reforms, capex and exports are likely to be growth drivers for the next financial year.
The Economic Survey is a pre-budget document authored by a team led by the Chief Economic Advisor (CEA). It is tabled in Parliament ahead of the Union Budget, to present the state of the economy and suggest policy prescriptions.
The newly appointed CEA VA Nageswaran is expected to speak to the media at 3:45pm on Monday. An academic and former executive with Credit Suisse Group AG and Julius Baer Group, Nageswaran succeeded KV Subramanian, who demitted the office of CEA in December 2021 after the completion of his three-year term.