Presentation on Economic Survey 2017 - 2018

1. ECONOMIC SURVEY
2017-2018
PRESENTED BY –
ARUN JAITLEY
PRESENTATION BY –
UMANG CHELAWAT
BIRLA INSTITUTE OF
MANAGEMENT TECHNOLOGY

2. WHAT IS ECONOMIC SURVEY ?
 It is presented every year in the Parliament during the Budget Session.
 The Economic Survey is presented normally a day before the presentation of the Union
Budget in the Parliament by the Finance Minister. It acts as a precursor to the budget.
 It summarizes the annual economic development in the country and sketches out short
and medium term prospects of the economy .
 Discusses outlook and challenges to the economy while also giving recommendation on
essential economic reforms.
 Prepared and presented by the Ministry Of Finance under the guidance of Chief Economic
Advisor .

3. ECONOMIC SURVEY 2017 – 2018
 Economic Survey 2017 – 2018 was authored by
current Chief Economic Advisor Arvind
Subramanian.
 It was presented in Parliament on 29th Jan 2018 by
Finance Minister Arun Jaitley.
 Economic Survey 2017 – 2018 document cover was
kept in Pink color by which government wants to
extend its support to Women’s Rights and also
Highlights Gender Issue Against Backdrop Of
Development. This year Economic Survey has 2 volumes .
1. In first volume, they have built upon and come up with new policies and ideas .
2. In second volume , review is done on what happened in last year.

4. MAJOR ACHIEVEMENT
LAUNCH OF GOODS & SERVICE TAX
 Goods & Service Tax , India’s biggest Tax reform was launched 1st July, 2017 by the then
President Dr. Pranab Mukharjee .
 Corrective actions were taken after the launch of GST to make it more stable and resolving
problems while implementing it.
 GST replaces about 20 indirect taxes at both the Centre and in states, while unifying the $2
trillion economy and 1.3 billion people into a single market.
 Tax structure under GST has been divided into four slabs of 5% ,12% ,18% & 28% .
 The new tax system is expected to improve tax compliance, increase revenue receipts of
Central and State governments and accelerate GDP growth rate by approximately 1.5-2
percentage points.

5. MAJOR ACHIEVEMENT
RESOLUTION OF TWIN BALANCE SHEET PROBLEM
 It is known as the twin balance sheet problem as the challenges faced by the banks are
linked to that of the corporate sector.
 The corporates are unable to repay their loans to banks & has affected the banks’ financials
very negatively and hence also their ability to lend more corporates.
 The twin balance sheet issue is nearing resolution with bank recapitalization of Rs 88,000
crore, and with coming of new Insolvency and Bankruptcy Code.
 The auctions under Insolvency And Bankruptcy Code is to attract large bids, reviving the
bust companies even while also providing money to distressed lenders.
 This could be a major breakthrough, with India finally creating an exit policy for failed
promoters, This will also help Bank credit, which was in very bad condition for a long time,
and is finally showing double-digit growth.

6. MAJOR ACHIEVEMENT
RATINGS IMPROVED
• Various reforms are taken by the Government which have led to increase in India’s ranking
in the World Bank’s Ease of Doing Business Index from 130 in 2017 to 100 in 2018.
• India’s ranking in the taxation and insolvency parameters improved by 53 and 33 spots,
respectively, on the back of administrative reforms undertaken by the Government of India
in the areas of taxation and passage of Insolvency and Bankruptcy Code (IBC), 2016.
• Moody's Investors Service has upgraded the Government of India's ratings to Baa2 from
Baa3 and changed the outlook on the rating to stable from positive. India’s rating has been
upgraded after a period of 13 years. India’s sovereign credit rating was last upgraded in
January 2004 to Baa3.

7. KEY HIGHLIGHTS
GROSS DOMESTIC PRODUCT (GDP)
Last Year
 GDP growth rate for 2017 – 2018 ( FY 18)
was 6.75 %.
 While estimated was from 6.75 % to 7.5%.
So it falls on the lower side of bracket
estimated
Projected Year
 GDP growth prediction for 2018– 2019 (FY
19) is 7 % to 7.5 %
Reasons for lower growth rate in GDP
 Demonetization
 Launch Of Goods And Service Tax
 Declining Demand , Rising NPA
 Disciplined Government Spending

8. KEY HIGHLIGHTS
FISCAL DEFICIT
 Central Government is confident of achieving fiscal deficit of 3.2 per
cent of GDP for 2017-18.
 Fiscal deficit during April to November 2017 has reached 112 % of
budgeted expenditure when compared to 85.8 per cent during the
corresponding period last year.
 Revenue and fiscal deficits of states as a percentage of
corresponding budget estimates is lower in the current year as
compared to the previous year.

9. KEY HIGHLIGHTS
INFLATION & MONETARY POLICY
 Below 4 % for more than 12 months ( since November 2016 ).
 Witnessed decline in inflation across major commodity groups
except Housing and Fuel & Light
 For FY 18
CPI Inflation averaged to 3.3 % which is lowest is last six years.
WPI Inflation averaged to 2.9 %.
 The Reserve Bank of India (RBI) has cut the repo rate by 25
basis points to 6.0 per cent in August 2017.

10. KEY HIGHLIGHTS
INCREASE IN TAX PAYER
 There has been an addition of about 1.8 million individual tax filers since November 2016.
 Indirect tax payers increased by 50 % after GST roll out .
 9.8 million unique GST registrants - An increase by 3.4 million compared to previous tax
regime .
 GST has shown an increase in revenue by 12 % than previous tax regime.
 Some states like Maharashtra , Uttar Pradesh , Tamil Nadu and Gujrat have the highest
number of GST registrants.

11. KEY HIGHLIGHTS
EXTERNAL SECTOR
 The current account deficit has declined to reach about 1.8 per cent of GDP in the first half
of FY2018.
 During April-December 2017, trade deficit increased by 46.4 per cent over corresponding
period of previous year.
 During April-December 2017, exports grew 12.1 per cent to US$ 223.5 billion, while imports
increased by 21.8 per cent to US$ 338.4 billion.
 Strong correlation between Export and Standard of Living – States which exports more has
more interstate trade & has shown better Standard of Living.
 India’s firm export structure is more egalitarian than in large countries that is 1 % of
companies in India export 38% of exports. While in develop countries 1% of companies
export around 70% of country’s export. So it is positive from that point of view.

12. OTHER KEY HIGHLIGHTS
 Savings has gone up due to especially after demonetization as people are forced to
deposit money in bank.
 Formal non agricultural payroll is much greater than believed – More than 30% when
formality is defined in terms of social security provision & 53 % when defined in terms of
being in GST net.
 India’s agriculture sector is likely to grow at 2.1% in 2017 -2018 , followed by industry at 4.4
% and services at 8.3%.
 Swachh Bharat initiative improved sanitation coverage in rural areas from 39 % in 2014 to
76% in January 2018.
 Policy agenda for next year are support agriculture , stabilize GST , privatize Air India , finish
bank recapitalization.

13. ‘Government does not have to do any thing radical , just finishing
what it has started would be a very ambitious and fantastic
agenda to complete’
-Arvind Subramanian ( CEA)

14. THANK YOU