Economic Survey 2021-22 | Economic Survey 2021-22 Highlights

Economic Survey 2021-22 | Economic Survey 2021-22 Highlights | Download Economic Survey 2021-22 PDF

Economic Survey 2021-22 expects the GDP to grow by 9.2% this year and 8% to 8.5% in 2022-23. Economic Survey also expressed concerns about the implications of hardening inflation and energy prices

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Economic Survey 2021-22: Relevance for UPSC Exam

GS Paper 3: Indian Economy– Issues relating to planning, mobilization of resources, growth, development and employment; Government Budgeting.

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Economic Survey 2021-22: Context

Recently, the Economic Survey 2021-22 was tabled by Finance Minister in the Parliament Budget Session 2022.
Economic Survey 2021-22 expects the GDP to grow by 9.2% this year and 8% to 8.5% in 2022-23.
- Economic Survey also expressed concerns about the implications of hardening inflation and energy prices.
When compared to pre-pandemic levels, recovery is most significant in exports followed by government consumption and gross fixed capital formation.
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Economic Survey and Chief Economic Advisor | About, Roles and Responsibilities

Economic Survey 2021-22 Highlights: Key Points

Economic Growth: Economic Survey 2021-22 expects the GDP to grow by 9.2% this year and 8% to 8.5% in 2022-23. This economic growth is based on the following assumptions-
- There will be no further debilitating pandemic related economic disruption,
- Monsoon will be normal,
- Withdrawal of global liquidity by major central banks will be broadly orderly,
- Oil prices will be in the range of US$70-$75/bbl, and
- Global supply chain disruptions will steadily ease over the course of the year
Agriculture sector: Economic Survey 2021-22 says that agriculture is least hit by pandemic, sector to grow by 3.9% in 2021-22 after growing 3.6% the previous year.
- Crop diversification towards oilseeds, pulses and horticulture needs to be given priority.
Industrial Sector: Industrial sector did go through a contraction and now it is about 4.1 per cent above pre-pandemic levels.
Service Sector: The segment of service sector that includes tourism, travel, and hotels is still 8.5 per cent below where it was before the pandemic. It is a sector that is still impacted.
Drivers of Economic growth: Economic Survey 2022 says that the Growth will be supported by-
- Widespread vaccine coverage,
- Gains from supply-side reforms and easing of regulations,
- Robust export growth, and
- Availability of fiscal space to ramp up capital spending.
Consumption: Government consumption has recovered well but the private consumption and segments such as travel, trade and hotels were yet to fully recover.
- The stop-start nature of repeated pandemic waves makes it especially difficult for these sub-sectors to gather momentum.
Investment: Economic survey 2022 says that the country’s investment to GDP ratio had hit 29.6% in 2021-22, the highest level in seven years.
- This capital formation attributed is to the government’s policy thrust on quickening the ‘virtuous cycle of growth via capex and infrastructure spending’.
- The year ahead is well poised for a pick-up in private sector investment with the financial system in a good position to provide support to the revival of the economy.
Risks to economic growth: Economic Survey acknowledges following risks to global economy-
- New COVID-19 variant: Such as Omicron which is sweeping across the world.
- Shortage of inputs such as semiconductors
- Inflation: Economic Survey acknowledges the inflation jumping up in most countries, and
- Cycle of liquidity withdrawal being initiated by major central banks.
Start-up Capital: According to the Economic Survey 2021-22, Delhi has replaced Bengaluru as the startup capital of India as the national capital added over 5,000 startups between April 2019 and December 2021.
- With a total of 11,308 startups, Maharashtra has the highest number of recognised startups in the country.
MGNAREGA Job demand: An analysis of the latest data on demand for work under MGNREGS suggests the following trends in the rural labour market-
- MGNREGS employment peaked during the nation-wide lockdown in 2020
- The demand for MGNREGS work has stabilised after the second Covid wave;
- Aggregate MGNREGS employment is still higher than pre-pandemic level.
Rise in Tax and Non-tax Revenue: Economic survey 2021-22 reports that there has been a sharp increase in both tax as well as non-tax revenue.
Current Account: Economic Survey 2022 pointed out that a strong recovery was seen in imports, rendering India’s net exports negative for the first half of the year, from a surplus in 2020-21.
- India has thus recorded a modest current account deficit of 0.2% in the first half, but robust capital flows in the form of continued inflow of foreign investment were sufficient to finance it.