Release of “The Indian Economy: A Review – January 2024” by Finance Ministry:

The Finance Ministry has released “The Indian Economy: A Review – January 2024” in lieu of the traditional ‘Economic Survey 2023-24’ ahead of the Interim Budget for the fiscal year 2024-25.

Finance Minister Nirmala Sitharaman is scheduled to present the Interim Budget for the fiscal year 2024-25 on February 1. Typically, a day before the budget presentation, the central government releases an Economic Survey. However, due to the interim nature of the budget and considering the upcoming elections, there won’t be an Economic Survey presented on January 31.

In the recently issued mini-annual Economic Survey titled ‘The Indian Economy: A Review,’ Chief Economic Adviser V Anantha Nageswaran outlines India’s potential to achieve a $7 trillion economy by 2030. This comprehensive 74-page document serves as a precursor to the upcoming Interim Union Budget 2024, offering insights into the country’s real growth rate projections for the fiscal year and addressing key challenges.

Given that the Lok Sabha elections for 2024 are scheduled for April-May, Finance Minister Sitharaman will not present a full budget. A complete budget, along with the Economic Survey, is slated to be presented in July following the election results and the formation of a new cabinet.

Key Highlights of the Economic Survey Review:

1. Economic Growth Projection: The report projects that the Indian economy is poised to achieve a growth rate of 7% or higher for the fiscal year 2023-24, with indications of sustaining this growth momentum into the following fiscal year (2024-25). This would mark four consecutive years of robust economic expansion post the pandemic.

2. Global Challenges and Trends: The global economy is grappling with challenges such as supply chain disruptions, a deceleration in trade, and the transformative impact of Artificial Intelligence. Despite these challenges, India is perceived as resilient, having successfully navigated previous shocks, and is adeptly managing the current global dynamics.

3. Shift in Global Manufacturing: The report notes the end of the era of hyper-globalization in global manufacturing. Governments worldwide are emphasizing onshoring and friend-shoring, affecting transportation, logistics costs, and final product prices. India is advised to reduce logistics costs and enhance product quality to sustain and expand its market share in this evolving global landscape.

4. Artificial Intelligence and Energy Transition: The emergence of Artificial Intelligence poses challenges to services trade and employment. Moreover, there is a significant emphasis on the global energy transition, with international pressure on developing nations to curb carbon emissions. India is recognized for effectively managing these challenges, striking a balance between economic growth and climate-related initiatives.

5. Domestic Economic Strength: Over the past decade, India has made substantial investments in infrastructure, resulting in a 3.3X increase in public sector capital investment. The financial sector is reported to be healthy, marked by robust non-food credit growth. The pursuit of inclusive development is evident in improved household financial health, job creation, declining unemployment rates, and advancements in education and healthcare indicators. The government’s effective handling of the COVID-19 pandemic and adept management of crude oil supply have contributed to the country’s economic resilience and stability.

The comprehensive document titled ‘The Indian Economy: A Review’ is available for access at:The Indian Economy: A Review – January 2024