Economic Survey 2015-16 Highlights

Sakshi Education

Finance Minister Arun Jaitley tabled the Economic Survey in the Lok Sabha.

Following are the highlights of Economic Survey 2015-16:
Indian economy would grow by between 7.0 per cent and 7.75 per cent in the 2016-17 fiscal year that starts on April 1.

Fiscal Deficit

2016-17 expected to be challenging from fiscal point of view; time is right for a review of medium-term fiscal framework
2015-16 fiscal deficit, seen at 3.9 per cent of GDP, seems achievable
Credibility and optimality argue for adhering to 3.5 per cent of GDP fiscal deficit target

Inflation

CPI inflation seen around 4.5 to 5 per cent in 2016-17
Low inflation has taken hold, confidence in price stability has improved
Expect RBI to meet 5 per cent inflation target by March 2017
Prospect of lower oil prices over medium term likely to dampen inflationary expectations

Current Account Deficit
2016/17 current account deficit seen around 1-1.5 per cent of GDP

Currency

Rupee's value must be fair, avoid strengthening; fair value can be achieved through monetary relaxation
India needs to prepare itself for a major currency readjustment in Asia in wake of a similar adjustment in China
Rupee's gradual depreciation can be allowed if capital inflows are weak

Banking & Corporate Sector

Estimated capital requirement for banks around 1.8 trillion rupees by 2018-19
Proposes to make 700 billion rupees available via budgetary allocations during current and succeeding years in banks
Government could sell off certain non-financial companies to infuse capital in state-run banks
Corporate, bank balance sheets remain stretched, affecting prospects for reviving private investments
Underlying stressed assets in corporate sector must be sold or rehabilitated

Taxes

Tax revenue expected to be higher than budgeted levels in 2015-16
Proposes widening tax net from 5.5 per cent of earning individuals to more than 20 per cent
Favours review and phasing out of tax exemptions; easiest way to widen the tax base not to raise exemption thresholds

Volume I	Volume II
Economic Outlook, Prospects, and Policy Challenges	State of the Economy: An Overview
The Chakravyuha Challenge of the Indian Economy	Public Finance
Spreading Jam across India's Economy	Monetary Management and Financial Intermediation
Agriculture: More from Less	External Sector
Mother and Child	Prices, Agriculture and Food Management
Bounties for the Well-Off	Industrial, Corporate, and Infrastructure Performance
Fiscal Capacity for the 21st Century	Services Sector
Preferential Trade Agreements	Climate Change and Sustainable Development
The Fertiliser Sector	Social Infrastructure, Employment and Human Development
Structural Changes in India's Labour Markets
Powering "One India"