Economic Survey Primer: Imported inflation to jab as macro indicator

Being agile

Economic Survey stresses on making policy decisions based on changing economic realities

Framework is based on feedback loops, real-time monitoring of actual outcomes, scenario analysis, identifying vulnerable sections, and understanding policy options rather than making deterministic prediction of events

Approach relevant today as availability of real-time data allows constant monitoring

Vaccination indicator

Vaccination is not just a health response but is now critical for opening up the economy, particularly contact-intensive services

For now, vaccination should be treated as a macroeconomic indicator. 

Using geospatial and cartography to track developments

Survey uses geospatial and cartographic techniques to show the extent of physical and financial infrastructure development in India

This includes expansion of national highways, airports, commercial bank branches, depict changes in net sown area of India over the last 15 years

The maps have been created by combining satellite data over 12-month period in each year

Imported inflation

India needs to be wary of imported inflation, especially from elevated global energy prices 

Surge in energy prices, non-food commodities, input prices, disruption of global supply chains, and rising freight costs stoked global inflation during the year

One volume 

The two-volume format allowed space for bringing in new ideas and themes but was also becoming unwieldy 

Thematic chapters of Volume 1 were not adequately linked to sectoral chapters of Volume 2. Therefore, this year’s Economic Survey reverts to a single volume plus a separate volume for the statistical appendix to give it a distinct identity as the one-stop source of authentic data

Standard cross-border insolvency framework

The absence of standardised cross-border insolvency framework creates complexities in restructuring

Raises issues such as the limit on obtaining access to assets held in a foreign country, priority of payments and recognition of local creditors

Current IBC provisions are ad-hoc in nature and are susceptible to delay.

Pushing R&D in shifting to renewables

India should avoid the risk of being a latecomer when developed countries have been frontrunners of net-zero emission plans

Inelastic supply of minerals is increasing prices of minerals, which are likely to shoot up even further in the future 

R&D should be encouraged to ensure effortless switch to renewable sources of energy. This may also include focus on developing technology that recycles, reuses and repurposes minerals 

With net zero target of 2070, climate finance will remain critical to successful climate action by developing countries, including India