Budget 2020 LIVE updates: FM Nirmala Sitharaman at Finance Ministry

Budget session 2020 LIVE updates: The Economic Survey is a detailed report card on the economic performance in the year

7:22 PM

Fiscal deficit target may be relaxed to arrest declining growth: Eco Survey

The Economic Survey on Friday made a case for relaxing the fiscal deficit target of 3.3 per cent of GDP in view of the need to arrest declining growth, estimated to touch an 11-year low of 5 per cent in the current fiscal.

 

The Medium Term Fiscal Policy (MTFP) statement presented with the Budget 2019-20, pegged the fiscal deficit target for 2019-20 at 3.3 per cent of gross domestic product (GDP), which was further expected to follow a gradual path of reduction and attain the targeted level of 3 per cent of GDP in 2020-21, and continue at the same level in 2021-22.

 

The year 2019-20 has been challenging for the Indian economy owing to the decelerating growth rate experienced in the first half of the year, said the survey prepared by a team led by Chief Economic Adviser K V Subramanian.

6:29 PM

Survey suggests scrapping of 'anachronistic' Essential Commodity Act 1955

The Economic Survey on Friday pitched for scrapping of the Essential Commodities Act (ECA), saying the law is "anachronistic" that leads to harassment and is of no help in checking price volatility.

 

The Survey also favoured "dynamic" foodgrain policy that allows switching from procurement and distribution of grains to cash transfers, but disfavoured loan waiver to farmers that disrupts the credit culture.

 

"The consumer affairs ministry and its related arms must examine whether the anachronistic ECA, which was passed in 1955 in an India worried about famines and shortages, is relevant in today's India," it observed.

 

Stating that around 76,000 raids under the ECA were conducted last year, the Survey said that considerable administrative effort goes into enforcement of this law assuming a minimum of 5 persons involved in a raid.

 

"As the conviction rate, however, is abysmally low and raids have no impact on prices, the ECA only seems to enable rent-seeking and harassment. The Survey provides clear evidence that the case for jettisoning this anachronistic legislation is strong," the document said.

6:28 PM

Majority of trade pacts implemented by India have no effect on exports: Survey

Majority of trade agreements being implemented by India have had "no effect" on the country's overall merchandise exports, according to the Economic Survey.

 

It also said that products manufactured in India have clearly benefitted from eight out of the fourteen trade agreements considered in the survey.

 

"A majority of the trade agreements exerted no effect on overall merchandise exports," it said.

 

The survey considered 14 agreements signed by India -- Chile, Korea, Sri Lanka, Singapore, Bhutan, Afghanistan, Nepal, Malaysia, Japan, Thailand, BIMSTEC, Asean, Mercosur, and SAFTA.

 

Exports of manufactured goods from India has benefitted from trade agreements with Mercosur (a six-country trade bloc including Brazil, Argentina, Paraguay and Uruguay), ASEAN, Nepal, Singapore, Chile, Bhutan, Afghanistan and Japan.

 

It said that four of the agreements (SAFTA, BIMSTEC, Thailand and Sri Lanka) had no effect on exports of manufactured products, while the bilateral agreements with Korea and Japan exerted a negative effect.

6:02 PM

Fiscal deficit target may be relaxed to arrest declining growth: Survey

The Economic Survey on Friday made a case for relaxing the fiscal deficit target of 3.3 per cent of GDP in view of the need to arrest declining growth, estimated to touch a 11-year low of 5 per cent in the current fiscal.

 

The Medium Term Fiscal Policy (MTFP) statement presented with the Budget 2019-20, pegged the fiscal deficit target for 2019-20 at 3.3 per cent of gross domestic product (GDP), which was further expected to follow a gradual path of reduction and attain the targeted level of 3 per cent of GDP in 2020-21, and continue at the same level in 2021-22.

 

The year 2019-20 has been challenging for the Indian economy owing to the decelerating growth rate experienced in the first half of the year, said the survey prepared by a team led by Chief Economic Adviser K V Subramanian.

5:56 PM

Cut in housing prices can help clear unsold inventories, clean up banks' balance sheets: Survey

The residential property market is reeling under huge unsold housing stocks because of issues like stalled projects and delayed possession, but inventories can be cleared if real estate developers take a haircut and reduce apartment prices, according to the Economic Survey.

 

The balance sheets of banks and non-banking financial companies (NBFCs) would also be positively impacted if builders decide so, it added.

 

Pitching for correction in property prices, the survey said that housing prices are ruling at a high level, even as the growth in rates has been muted since 2015-16.

 

"Government's thrust on affordable housing is evident, in order to boost the real estate sector and consequently the construction activity in the country. Higher investment in housing by households may increase the fixed investment in the economy," the survey said.

 

"Existing unsold housing inventory can be cleared and the balance sheets of both bank/non-bank lenders cleaned if the real estate developers are willing to take a 'hair-cut' by allowing the house-prices to drop," it added.

5:51 PM

Govt must unleash bold reforms to achieve 6-6.5 pc growth in FY21, say experts, industry

Attaining a GDP growth rate of 6 to 6.5 per cent in 2020-21 as projected by the Economic Survey will be "challenging" and the government needs to prioritise growth while unleashing bolder policy measures to achieve it, experts and industry bodies said on Friday.

 

India's economic growth is expected to "strongly rebound" to 6-6.5 per cent in 2020-21 from 5 per cent estimated in the current fiscal, said the Economic Survey 2019-20 tabled in Parliament on Friday by Finance Minister Nirmala Sitharaman, adding that the government with a strong mandate has the capacity to expedite reforms.

 

"The 6-6.5 per cent growth pegged by the Economic Survey for 2020-21, is a target that is achievable with the right dose of reforms and public investments," CII Director General Chandrajit Banerjee said.

5:32 PM

Thalinomics in times of rising prices: Veg, non-veg thalis more affordable, says Eco Survey

Rising inflation may have burnt a hole in common man's pocket but Finance Ministry's chief economic advisor believes otherwise as he brought a novel 'thali' concept to otherwise heavy-duty data crunching to drive home the point that affordability of a plate of meal has improved.

 

Calling it 'Thalinomics', Krishnamurthy V Subramanian compared price of standard veg and non-veg meal plates across the country to say that affordability as a factor of daily wage has improved overtime, indicating improved welfare of the common person.

 

The affordability of vegetarian 'thalis' improved by 29 per cent while that of non-vegetarian by 18 per cent between 2006-07 and 2019-20, the Economic Survey said in its chapter 'Thalinomics -- The Economics of a Plate of Food in India".

5:30 PM

Privatised CPSEs reported better profit, sales after transition: Survey

Most privatised CPSE witnessed improvement in net worth, profit, gross revenue and sales growth after the transition, the Economic Survey has said.

 

The survey, tabled in Parliament on Friday, examined the change in performance for each individual central public sector enterprises (CPSE). It studied the movement in major financial indicators for each of the firm ten years before and after the year of strategic disinvestment or privatisation.

 

Taken individually, each privatised CPSE witnessed improvement in net worth, net profit, gross revenue, net profit margin, sales growth in the post-privatisation period compared to pre-privatisation period except for Hindustan Teleprinters, MFIL and Tata Communications in the case of few indicators. it said.

5:30 PM

Consequential train accidents decreased in 2018-19: Survey

Stating that steps are being taken on a regular basis to prevent rail accidents, the Economic Survey on Friday said consequential train accidents registered a decline in 2018-19.

 

It said number of consequential train accidents decreased to 59 in 2018-19, compared with 73 in the previous year. In 2019-20 (April-October 2019), 41 consequential train accidents took place.

 

"Safety is accorded the highest priority by Indian Railways and steps are being undertaken on a continuous basis to prevent accidents and to enhance safety of the passengers," according to the Economic Survey 2019-20 tabled in Parliament.

5:25 PM

150,000 Ayushman Bharat Health & Wellness Centres to be set up by 2022: Survey

To promote preventive healthcare, 150,000 Ayushman Bharat Health & Wellness Centres are proposed to be set up by 2022, according to the Economic Survey 2019-20.

 

The Survey was tabled in Parliament on Friday by Finance Minister Nirmala Sitharaman. A total of 28,005 such centres have already been set up as on January 14, 2020, it added.

5:05 PM

Intense competition, low tariffs led to financial stress in telecom sector: Survey

Substantial competition and low tariff rates by telecom operators since 2016 have led to a financial stress in the sector, the Economic Survey said on Friday.

 

The data price in the country came down by over 99 per cent during 2016-2019, making it among the lowest tariff in the world, according to the survey.

 

"Since 2016, the sector has witnessed substantial competition and price cutting by the telecom service providers (TSPs), creating financial stress in the sector. As a result, the sector is experiencing consolidation. While some operators have filed for bankruptcy, others have merged, in their quest to improve viability," the survey report said.

 

In April-June 2019, the price of data was Rs 7.7 per gigabyte (GB) as compared to Rs 200 per GB in June 2016, it added.

 

"The Average Revenue Per User (ARPU) for GSM based mobile services has also gone down substantially from Rs 126 in June 2016 to Rs 74.30 in June 2019," the survey said.

5:05 PM

Survey expresses worry over aging shipping fleet, low share in global tonnage

The Economic Survey has expressed concerns over aging Indian shipping fleet and a meagre 0.9 per cent share of the country in total global dead weight tonnage.

 

About 42 per cent of India's 1,419 fleet is 21 years and above, the Economic Survey for 2019-20, tabled in Parliament by Union Finance and Corporate Affairs Minister Nirmala Sitharaman on Friday, said.

 

"Despite one of the largest merchant shipping fleet among developing countries, India's share in total world dead weight tonnage (DWT) is only 0.9 per cent as on January 1, 2019 ... The existing Indian fleet is also aging, with the average age increasing from 15 years in 1999 to 19.71 years as on October 1, 2019 (42.06 per cent of the fleet is 21 years and above and 12.49 per cent is in the 16 to 20 year age group)," the Economic Survey said.

5:03 PM

Eco Survey focuses on wealth creation, says PM Modi

The Economic Survey focuses on wealth creation for Indians and outlines a multi-faceted strategy to achieve a USD 5 trillion economy through enterprise, exports and the ease of doing business, Prime Minister Narendra Modi said on Friday.

 

Economic Survey 2019-20 projected the revival of economic growth to 6-6.5 per cent in the next fiscal beginning April 1 but suggested the government should relax the budget deficit target to boost growth from a decade low.

 

The Survey, released a day before the Union Budget for 2020-21 is presented, called for cutting food subsidy while at the same time looking at businessmen with respect as they create wealth and jobs.

 

"The #EconomicSurvey 2019-20 focuses on wealth-creation for 130 crore Indians. It outlines a multi-faceted strategy to achieve a $5 trillion economy through enterprise, exports, ease of doing business and more," Modi said on Twitter.

4:51 PM

Contraction in domestic revenue growth softened IT-BPM sector growth in FY19: Survey

Contraction in domestic revenue growth "softened" the overall pace of revenue growth of the IT-BPM sector to 6.8 per cent in 2018-19 from 8.2 per cent in the previous year, the Economic Survey said on Friday.

 

Nearly 83 per cent of the IT-Business Process Management (BPM) industry continues to be export-driven, with export revenues crossing USD 135 billion in 2018-19, it said.

 

"During 2018-19, the revenue growth (y-o-y) for IT-BPM sector (excluding hardware) softened to 6.8 per cent from 8.2 per cent in 2017-18. This was driven by a contraction of 0.3 per cent in domestic revenue growth even as export revenue growth accelerated to 8.3 per cent," it added.

4:49 PM

Congenial environment for aviation sector; airlines to have 1,200 planes by FY'24: Survey

Indian aviation sector "re-established" its resilience this fiscal despite a large airline suspending operations and the government has been providing a congenial environment so that airlines can have more than 1,200 planes by 2023-24, according to the Economic Survey.

 

India is the world's third largest domestic market for civil aviation and has 136 Airports Authority of India (AAI)-managed airports as well as six aerodromes under public private partnerships, it said.

 

In recent times, domestic traffic growth had faced headwinds.

 

The Survey for 2019-20, tabled in Parliament on Friday, also said airlines operators in the country have scaled up their aircraft seat capacity from an estimated 0.07 annual seats per capita in 2013 to 0.12 in 2018.