Economic Survey 2022-23: Capex-led growth to bring back animal spirits

Finance Minister Nirmala Sitharaman tabled the Economic Survey 2022-23 in the Lok Sabha today. The Economic Survey, prepared by chief economic advisor V Anantha Nageswaran, is the government's review of how the economy fared in the ongoing fiscal.

3:45 pm The growing importance of India's digital ecosystem envisions start-ups as the 'spine of new India' as they encourage the youth to become job creators rather than job seekers, says Economic Survey. "Total number of jobs created by DPIIT (Department for Promotion of Industry and Internal Trade) recognised startups has increased to 269,000 in 2022 from some 43,000 in 2017," the survey says.

3:30 pm India's current account deficit (CAD) is expected to be within sustainable limits during the remainder of FY23 owing to an ease in crude oil prices, says Economic Survey.

3:15 pm India's debt portfolio is relatively stable owing to low currency and interest rate risks, notes to the Economic Survey 2022-23.

3:07 pm India's installed power capacity by the end of 2029-30 is expected to be over 800 gigawatt (GW), of which non-fossil fuel would contribute more than 500 GW, about 62% of the then total installed capacity, says Economic Survey.

2:56 pm The emphasis on capex in recent years is expected to boost GDP growth directly, and indirectly through multiplier effects on private consumption expenditure and private investment, says the Economic Survey. "Higher GDP growth would thereby facilitate buoyant revenue collection in the medium term, and thereby enable a sustainable fiscal path," it adds.

2:45 pm The spike in India's debt and deficit ratios has not only been due to higher spending necessitated by the pandemic-induced cessation of economic activity but also due to the contraction or slower growth in the nominal GDP, says Economic Survey 2022-23.

2:37 pm PM GatiShakti has helped accelerate infrastructure development by integrating the seven engines (roads, railways, airports, ports, mass transport, waterways, and logistic infrastructure) of growth, says Economic Survey.

2:20 pm UPI has processed 2,922 crore contactless merchants' transactions with a total value over ₹21.7 lakh crore in FY23 (till December 2022). "Tech companies are increasingly leveraging the power of UPI to expand the digital ecosystem, which has led to a significant acceleration in the pace of financial inclusion. UPI has opened up many opportunities for start-ups and e-eommerce players to develop innovative solutions that elevate the customer experience. The open systems have enabled global players like Google, WhatsApp, Walmart, True Caller, Amazon, Uber etc., to provide UPI services," says Economic Survey 2022-23.

2:10 pm Out of the budgeted disinvestment target of ₹65,000 crore for FY23, 48% has been collected as of January 18, 2023, says Economic Survey.

2:00 pm Capex-led growth to bring back animal spirits and manage debt levels, notes Economic Survey. The Government of India had budgeted an unprecedented ₹7.5 lakh crore of Capital Expenditure for FY23, of which more than 59.6% has been spent from April to November 2022. During this period, capital expenditure registered a Y-o-Y growth of over 60%, much higher than the long-term average growth of 13.5% recorded in the corresponding period from FY16 to FY20.

1:50 pm India is on its way to achieve the fiscal deficit target of 6.4% estimated in the current financial year despite additional expenditure on subsidies owing to the Russia-Ukraine war, says Economic Survey 2022-23.

1:44 pm Strong macroeconomic fundamentals will underpin the return of global capital flows to India once the fog of uncertainty lifts, says the Economic Survey 2022-23.

1:37 pm The increase in the overall bank credit has also been influenced by the shift in borrower’s funding choices from volatile bond markets, where yields have increased, and external commercial borrowings, where interest and hedging costs have increased, towards banks, the survey says.

1:35 pm If inflation declines in the upcoming fiscal and if real cost of credit does not rise, then credit growth is likely to be brisk in FY24, according to the Economic Survey 2022-23.

1:30 pm Inflation in India "did not creep" too far above RBIs target level, says Economic Survey 2022-23.

1:28 pm Overall, the inflation challenge in FY24 must be a lot less stiff than it has been this year, notes Economic Survey 2022-23.

1:20 pm The Economic Survey says the credit growth to the Micro, Small, and Medium Enterprises (MSME) sector has been remarkably high, over 30.6%, on average during Jan-Nov 2022, supported by the extended Emergency Credit Linked Guarantee Scheme (ECLGS) of the Union government.

1:18 pm The economy is expected to grow at 7% for the year ending March 2023, says Economic Survey.

1:17 pm Economic Survey 2022-23 projects a baseline GDP growth of 6.5% in real terms in FY24.

1:15 pm India to witness GDP growth of 6% to 6.8% in 2023-24, depending on the trajectory of economic and political developments globally, says Economic Survey.

This comes at a time when the International Monetary Fund (IMF) has called India a bright spot and retained the country's FY23 growth forecast at 6.8%. The IMF expects growth in India to decline from 6.8% in 2022 to 6.1% in 2023 before picking up to 6.8% in 2024, with resilient domestic demand despite external headwinds.

President Droupadi Murmu kickstarted the Budget Session at 11 am with a joint address to both the houses of the Parliament. The President highlighted various achievements of the Narendra Modi government.

12:08 pm "Seven years ago there were only a few hundred registered startups in India. Today, this number is reaching around 90,000," says President Murmu.

12:05 pm In 2015, India was ranked 81st in the Global Innovation Index. Now we have reached the 40th position, says President Murmu.

11:50 am "As a result of new initiatives by my government, our defence exports have increased six times," says President Murmu.

11:45 am "We need to build Aatmanirbhar Bharat by 2047," says President.

11:35 am "Government has decided to extend PM Garib Kalyan Anna Yojana in accordance with the new circumstances. This is the identity of a sensitive & pro-poor govt," says President Droupadi Murmu in Parliament.

11:28 am "My government is of the clear opinion that corruption is the biggest enemy of democracy and social justice. To seize the property of fugitive economic offenders, my government passed the Fugitive Economic Offenders Act," says President Murmu in Parliament.

11:20 am Govenrnment e-marketplace has seen transactions worth over ₹3 lakh crore.

11:11 am India no longer depends on other countries to solve its issues, rather other countries are looking at India to help them out with their problems

11:10 am India is known for development, moving away from days of policy paralysis

11:08 am "Today, India's self-confidence is at its highest and the world is looking at her from a different perspective," says President.

11:07 am "By 2047, we have to build a nation that will be connected to the pride of the past and which will have all the golden chapters of modernity. We have to build an India that will be 'aatmanirbhar' and capable to fulfill its humanitarian duties," says President Murmu in Parliament ahead of Economic Survey presentation.

11:05 am: President Murmu begins her address to the joint session of Parliament.