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Economic Survey seems to have its head in the sand under storm clouds

Published

8 years ago

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Economic Survey seems to have its head in the sand under storm clouds

GDP growth projection of 7-7.5 percent probably seems too optimistic

The Economic Survey 2018 projects 7-7.5 per cent growth rate in 2018-19, up from 6.75 per cent in the current fiscal, making India once again the world’s fastest growing major economy.

The forecast, that comes within an environment of slow and jobless growth, says the economy will grow on the back of major reforms which would be strengthened further in the next financial year.

“A series of major reforms undertaken over the past year will allow real GDP growth to reach 6.75 per cent this fiscal and will rise to 7 to 7.5 per cent in 2018-19, thereby re- instating India as the world’s fastest growing major economy,” it says.

The survey points out that India can be rated as among the best performing economies in the world as the average growth during last three years is around 4 percentage points higher than global growth and nearly 3 percentage points higher than that of emerging market and developing economies.

It says that the GDP growth has averaged 7.3 per cent from 2014-15 to 2017-18, which is the highest among the major economies of the world.

“That this growth has been achieved in a milieu of lower inflation, improved current account balance and notable reduction in the fiscal deficit to GDP ratio makes it all the more creditable,” it says.

The survey says that after the preliminary analysis of Goods and Services Tax (GST) data, there has been a 50 per cent jump in the number of indirect taxpayers and a huge increase in voluntary registrations, particularly by small enterprises. The number of individual income tax filers increased by over 18 lakh since November 2016 the month when demonetisation was implemented.

As for the optimistic projections of growth rate, if the survey had taken into consideration of the sharply spiking fuel prices, then, possibly, a change of heart would have occurred. On the other hand, since petroleum is still beyond the scope of GST, higher collection from taxes remains a possibility despite shooting oil prices. That might hot, however, translate into higher GDP growth.

What will be difficult to achieve in this scenario would be fiscal discipline and the deficit could well travel beyond control. And, when the resource pool for buying oil grows, even a small appreciation in the value of the Rupee could have major adverse effects at home.

Much of the survey’s optimism stems from an expectation of higher export. That may be so, but if the Rupee has appreciated against the accepted basket of foreign currencies, it will cancel out the positivity and we could well be standing pretty much where we started.

Before going any further, we need to read the substance of the survey which states that growth is on track, revenue collection is on the rise – it has to be remembered that this is the first survey and first Union Budget after the implementation of GST – and fiscal deficit was under reasonable check.

The survey also sees growth in private investment, the hallmark of any growing economy in the next fiscal while also adding flesh to government initiatives in the education and agriculture.

Apart from the fact that this survey’s forecast runs in the face of the government’s own advance GDP data as was available this month – that expected the economy to grow at a four-year low of 6.5 percent in the current fiscal, mainly due to the poor performance of agriculture and manufacturing sector, against last fiscal’s 7.1 percent – it is possibly avoiding this confrontation, especially with jumping fuel prices barking at its feet.

The fiscal deficit target of the government for this fiscal was 3.2 percent of GDP against 3.5 percent in 2016-17, but it is well known that with the elections progressing and things not looking too good, finance minister Arun Jaitley may be forced to take a populist stance, in which case the fiscal deficit target can only be relaxed, with discipline given a go-by.

The projections here, therefore, would taste better with a pinch of salt.

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India News

Rahul Gandhi alleges institutional bias, questions electoral system during Berlin address

Rahul Gandhi alleged that India’s institutions and electoral system have been weaponised to favour the BJP, remarks that sparked a strong political response.

Published

41 mins ago

on

December 23, 2025

By

Rahul-Gandhi

Leader of the Opposition in the Lok Sabha, Rahul Gandhi, has said that India’s institutional framework is facing a serious challenge and has been used to favour the ruling BJP. Speaking during an interaction at the Hertie School in Berlin, Gandhi questioned the functioning of key institutions and the electoral machinery, remarks that triggered a sharp political response from the BJP.

Gandhi said the Congress believes there is a problem with the electoral system and alleged that several institutions have been captured. Referring to investigative agencies, he claimed that bodies such as the CBI and the ED have been used as political tools. According to him, cases filed by these agencies overwhelmingly target those opposing the BJP, while leaders from the ruling party face none.

He also pointed to what he described as a stark financial imbalance between the BJP and the opposition, claiming a funding ratio of 30:1. Gandhi said this disparity reflects how institutions are being used to consolidate political power.

Opposition strategy and INDIA alliance

The Congress leader said merely pointing out problems in elections is not enough and stressed the need for the opposition to build a system of resistance that can effectively counter the ruling party. He added that the challenge now goes beyond electoral contests and is about presenting an alternative vision for the country.

On the INDIA alliance, Gandhi said the unity among opposition parties is rooted in their rejection of the ideological position of the RSS. While acknowledging that tactical contests between alliance partners will continue, he said they remain united when it comes to opposing laws they disagree with and working together in Parliament.

BJP hits back at remarks abroad

Gandhi’s comments delivered overseas drew a strong reaction from the BJP. Party president and Union minister JP Nadda accused him of speaking against India while Parliament is in session and claimed that he was undermining the country’s image at a time when the Prime Minister is receiving global recognition.

BJP spokesperson Shehzad Poonawalla also criticised Gandhi, alleging that he routinely travels abroad to defame India. He accused the Congress leader of making misleading claims about the country’s institutions and economic activity while praising China.

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India News

DU VC Prof Yogesh Singh entrusted with additional charge of AICTE Chairman

Published

18 hours ago

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December 22, 2025

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Prof. Yogesh Singh, Vice Chancellor of the University of Delhi, has been entrusted with the additional charge of the post of Chairman, AICTE till the appointment of a Chairman of AICTE or until further orders, whichever is earlier.

It is noteworthy that AICTE Chairman Prof. TG Sitharam was relieved of his duties after his term ended on December 20, 2025. According to a letter issued by the Ministry of Education, Government of India, on Monday, Prof. Yogesh Singh’s appointment is until the appointment of a regular AICTE Chairman or until further orders whichever is earlier.

Prof. Yogesh Singh is a renowned academician with excellent administrative capabilities, who has been the Vice-Chancellor of University of Delhi since October 2021. He has also served as the Chairperson of the National Council for Teacher Education. In August 2023, he was also given the additional charge of Director of the School of Planning and Architecture (SPA).

Prof. Yogesh Singh served as the Vice-Chancellor of Delhi Technological University from 2015 to 2021; Director of Netaji Subhas Institute of Technology, Delhi from 2014 to 2017, and before that, he was the Vice-Chancellor of Maharaja Sayajirao University, Baroda (Gujarat) from 2011 to 2014. He holds a Ph.D. in Computer Engineering from the National Institute of Technology, Kurukshetra. He has a distinguished track record in quality teaching, innovation, and research in the field of software engineering.

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India News

Goa nightclub fire case: Court extends police custody of Luthra brothers by five days

A Goa court has extended the police custody of Saurabh and Gaurav Luthra, owners of the nightclub where a deadly fire killed 25 people, by five more days.

Published

18 hours ago

on

December 22, 2025

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Luthra brothers

A court in Goa on Monday extended the police custody of Saurabh Luthra and Gaurav Luthra, the owners of the Birch by Romeo Lane nightclub, by five more days in connection with the deadly fire incident that claimed 25 lives on December 6.

The order was passed as investigators sought additional time to question the two accused in the case linked to the blaze at the Anjuna-based nightclub.

Owners were deported after fleeing abroad

According to details placed before the court, the Luthra brothers had left the country following the incident and travelled to Thailand. They were subsequently deported and brought back to India on December 17, after which they were taken into police custody.

Advocate Vishnu Joshi, representing the families of the victims, confirmed that the court granted a five-day extension of police custody for both Saurabh and Gaurav Luthra.

Another co-owner sent to judicial custody

The court also remanded Ajay Gupta, another owner of the nightclub, to judicial custody. Police did not seek an extension of his custody, following which the court passed the order, the victims’ counsel said.

The Anjuna police have registered a case against the Luthra brothers for culpable homicide not amounting to murder along with other relevant offences related to the fire incident.

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