Economic Surveys: Purpose and Approaches
The Economic Surveys (ES) are crafted under the guidance of the Chief Economic Advisor (CEA) to guide policymakers, businesses, and citizens on the government's economic role.
- Provide an impartial assessment of both macroeconomic and sectoral performance.
- Critically analyze key economic issues and suggest policy solutions.
- Review budget performance and propose course corrections.
CEAs adopt one of three approaches: Objective, critical, or propagandist.
Historical Evolution of Surveys
- Arvind Subramanian: Introduced a new volume critiquing major issues.
- Krishnamurthy Subramanian: Echoed governmental views with some objective analysis.
- V Anantha Nageswaran: Aims for a balance, though somewhat biased towards government perspectives.
Major Economic Insights from ES-26
GDP Growth Analysis
ES-26 projects a GDP growth of 6.8% to 7.2% in 2025-26, a continuation from the previous year's growth of 7.4%.
- Nominal GDP growth is estimated at 8%, with a minimal difference from real GDP growth.
- Rupee depreciated by over 6.5%, leading to a low dollar GDP growth of 1.5%.
- Concerns over achieving the Prime Minister’s goal of making India the third-largest economy before the next Lok Sabha elections.
Employment and Manufacturing Challenges
- Three employment-linked incentive schemes and an internship program have underperformed.
- Manufacturing remains stagnant at 12-13%, despite initiatives like Make In India and PLIs.
- PLI disbursements are below 10% after four years, with some projects not yet operational.
Fiscal Performance and Strategic Advice
- Fiscal strain due to tax decisions, such as making incomes up to Rs 12 lakh tax-free.
- Lack of insights on challenging fiscal issues.
- Advice to shift from import substitution to strategic indispensability is not clearly articulated.
The Economic Survey, while rich in descriptions, lacks actionable insights and is unlikely to drive policy discussions.
