Highlights of Economic Survey 2013 for Prelims Preparation
As I have mentioned in the post on IAS books, Economic Survey published before the general budget each year by the Finance Ministry is the authentic source of economic data and review of the current economic scenario. No wonder, UPSC gives it so much importance not just in Prelims but Mains as well. In this post I have listed the important points in the 2013 Economic Survey that you will hopefully find of value for this year’s Prelims paper. Also it is suggested that you go through the economic tables in the second part of Economic Survey.
- India’s economy expected to grow between 6.1 percent to 6.7 percent in 2013-14. GDP Growth rate was just 5.0 percent in 2012-13.
- Slowdown in the rate of growth of services to 6.6 percent in 2012-13 contributed to a slow in overall growth. Growth in Manufacturing and Agriculture also declined.
- FDI in retail may pave the way for investment in new technology and marketing of agricultural produce in India.
- Non-performing assets (NPA) of the banking sector increased from 2.36 percent of the total credit advanced in March 2011 to 3.57 percent of total credit advanced in September 2012.
- The survey calls for a widening of the tax base, and prioritization of expenditure as key ingredients of a credible medium term fiscal consolidation plan. Some measures taken in Union Budget 2013-14 include levy of Service Tax on all air-conditioned eating places, 10% surcharge on income of individuals earning more than 1 crore rupees in a financial year.
- Expenditure on social services also increased considerably in the 12th Plan, with the education sector accounting for the largest share followed by health.
- India is on track to meet its fiscal deficit target of 5.3% of GDP this fiscal year, and to narrow it down to 4.8% of GDP next year.
- The Economic Survey 2012-13 recommended curbing imports, mainly of gold, in a bid to reduce India’s current account deficit, which stood at 4.2% of GDP last year and is projected to be at similar levels this year.
- The study said a priority should be to reduce waste in social spending through projects like direct-cash transfers to the poor. India’s spending on social welfare increased from 5.9% of GDP in the year that ended March 31, 2008 to an estimated 7.1% of GDP in the current year.
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