Calling the Economic Survey
for 2017-18 a reflection of the government’s commitment to growth and development, the Chairman of the Economic Advisory Council to the Prime
Minister (EAC-PM) Bibek Debroy hailed the emphasis on women’s empowerment
describing it a welcome step.
Debroy, according to a release
endorsed the pick-up in growth highlighted in the survey, but was of the view
that in 2018-19 the real GDP growth rate is likely to be closer to 7.5 per cent
rather than 7 per cent.
"The government is
committed to fiscal consolidation and prudent public expenditure. It would be
in order if public expenditure is also financed through off-Budget instruments…"It
is rightly mentioned that growth drivers will have to fundamentally emerge
through exports, private investments and consumption," he noted.
The statement also said that
EAC-PM chairman is of the view that the impact of any increase in crude prices
will be more than compensated by recovery in exports, private investments and
even private consumption, unless real interest rates remain too high. The
survey estimates a real GDP growth rate of 6.75 per cent for the current
fiscal, based on a 7.5 per cent real growth for the second half of the year.
For 2018-19 it projects a real GDP growth between 7 and 7.5 per cent.
According to the statement,
the survey is also optimistic in its tone because of government’s commitment to
carry forward structural reforms like GST, deregulation measures, bank
re-capitalization and resolution through the IBC process.
With regard to
demonetization, the Survey called it only a blip that did not last beyond mid
2017 and it went on to say that despite a lot of general statements on the
impact of demonetization and GDP growth, demonetization and GST aimed at
increasing the taxpayers base and the Survey has figures to show that the
objectives have been achieved though many of these tax payers declared incomes
that are close to the minimum threshold levels.
Noting that there has also
been a lot of debate about job growth, despite the lack of credible data, the
statement said, "The survey has specific numbers to show that formal
sector employment is much higher than what is commonly suggested."
The statement of EAC PM
concludes referring to the down-side risks and up-side gains: The survey lists
out down-side risks and up-side gains that will influence growth in 2018-19.
Amongst down-side risks, the most important one is crude oil prices. The
Chairman, EAC-PM is of the view that the impact of any increase in crude
prices, will be more than compensated by recovery in exports, private
investments and even private consumption, unless real interest rates remain too