An economic survey released by the finance ministry a day before the union budget will be presented. It is a report card of the whole financial year stating which sector has performed at what level, according to the same, union budget expectations are established by all the stakeholders.
In the economic survey for the year 2022-2023, there are key highlights presented on the tabled document in the house of parliament:
The pandemic recovery is over
It is clearly stated that the damage done by the Covid-19 pandemic is now over as the economic slowdown driven by the pandemic has improved, and domestic demand and capital investment have increased in the financial year 2022-23. But, the risk is not over yet as the economic disturbances still remain because of global factors, the Russia-Ukraine war, and peaking energy prices. According to the survey, the country is prepared for covid-like situations, both financially and resourcefully.
READ MORE: Budget 2023: Disinvestment proceeds of ₹4.07 lakh crore realised in last 9 years, says Economic Survey
GST leads to tax buoyancy in the system
Tax buoyancy, an increase in tax collection in the proportion to an increase in national income, has improved significantly. The analysis was done for the 5-year which includes both pre-GST and post-GST periods. It has been observed that the tax collection percentage in the post-GST period is higher than pre-GST. The tax buoyancy rate has improved in the ratio of 1:1.
Vaccination leads people spend more; the housing market is an evidence
Vaccination is dramatically successful in India, which is currently represented by the increase in people spending in the street by utilising contact-based services like restaurants, hotels, shopping malls, cinemas, etc., by completing more than 2 billion doses to the citizens.
It helps in rebounding the consumption rate in the country at pre-pandemic levels, which can be evidenced by the improvement in the housing sector as well. The housing sector has witnessed a decline in inventory in hands or overhang inventory from 42 months in Q3 of FY 2022 to 33 months in Q3 of FY 2023.
Slower GDP growth rate
According to the economic survey, India’s economy will grow by 6.1% in 2023-24, compared to 7% current fiscal and 8.7% in 2021-22. The GDP of the country is projected to be 6-6.8% in the fiscal year 2023-2024 in real terms, depending on the further situations of political and economic developments worldwide.
However, according to the economic survey, India is already doing better than other emerging economies given that the Indian currency has performed better than South African, Brazilian, and Australian currencies.
READ MORE: Budget 2023: Indian economy to grow 6.5% next fiscal year: Economic Survey
India’s phygital model is pushing the economy upwards
The model of physical + digital infrastructure is becoming a defining feature of the country. India’s economic growth is poised with the promotion of “Digital India” which is not only helping the country in bringing transparency, but also establishing a space in the eyes of the global. As the digital economy is widening, new services are being observed and introduced by various industries.
The word “tech” can be seen in every sector, healthTech, FinTech, InsureTech, and a lot more. It is solving the problem of time-consuming processes, and generating employment by making employees “tech-enabled”.
As per the economic survey, India is currently facing the problem of a current account deficit but there is sufficient forex to cope with the prevailing situation. The primary problem which is partially uncontrollable by the central government is inflation, as it depends on global political developments. No wonder India is doing better than other economies amid the financial crunch worldwide and walking in the right direction.
Anushka Trivedi is a freelance financial content writer. She can be reached at anushkatrivedi.com