‘Thalinomics’ to Smart Cities – All About Economic Survey 2020

The Economic Survey 2020 comes at a time when the country is facing its worst slowdown in a decade. No wonder then that the survey focussed on creating “a positive impact on growth” in the next fiscal.The government’s thrust on affordable housing, Make in India, reduction in corporate tax rate, and improvement in ease of doing business, besides others factors, will help in boosting economic growth, the survey noted. Apart from projecting a “strong rebound” with 6-6.5 percent growth in 2020-21 from 5 percent estimated in the current fiscal, here’s what the survey said across different sectors.The Economic Survey noted that road transport is the dominant mode of transportation. In 2017-2018, the share of transport sector in the Gross Value Added (GVA) was about 4.77 percent.ROADSThe total investment in the roads and highways sector has gone up more than three times in five year period of 2014-15 to 2018-19, the survey said.RAILWAYSThe survey marked that during the year 2018-19, Indian Railways carried 120 crore tones of freight and 840 crore passenger, making it the world’s largest passenger carrier and fourth largest freight carrier.AVIATIONTaking a comprehensive view of civil aviation, the survey observed that India has 136 commercially managed airports by the Airport Authority of India and six under public private partnerships for operation, maintenance and development of airports.A total 43 airports have been operationalised since the scheme for operationalising unserved airports was taken up.To ease the strain on existing airports, 100 more airports are to be made operational by FY 2023-24, the survey said.The survey also hopes that due to the “congenial environment” that the government has been providing, the Indian carriers will double their fleet from about 680 aircraft at the close of 2019 to 1,200 by FY2023-24.SHIPSAbout shipping sector, the Economic Survey stated that around 95 percent of India’s trade by volume and 68 percent in terms of value is transported by sea. As on 30 September 2019, India had a fleet strength of 1,419 ships.To spur economic growth and achieve $5 trillion economy, India needs to spend about $1.4 trillion on the infrastructure sector during FY2020-2025, the Economic Survey noted.According to the National Infrastructure Pipeline (NIP), the Centre and the state government are expected to have equal share of funding of the projects of 39 percent each, followed by the private sector of 22 percent. Projects worth Rs 42.7 lakh crore are under implementation.ELECTRICITYThe survey said progress has been made in universal electrification as far as generation and transmission of electricity is concerned. The installed capacity has increased from 3,56,100 MW in March 2019, to 3,64,960 MW as on 31 October 2019, according to the survey.The survey observed that except for few households in Left Wing Extremism affected Bastar Region of Chhattisgarh, all the states have reported electrification of all households on the Pradhan Mantri Sahaj Bijli Har Ghar Yojana (SAUBHAGYA) portal.MININGOn mining sector, it said there has been a notable turnaround in mineral production because of policy reforms and production of major minerals during the year 2018-19 has recorded a growth of 25 percent when compared to last year in terms of value.While giving a overview of the construction sector, the survey said it accounts for 8.24 percent of GDP, which includes housing, and employs about 12 percent of the work force.HOUSINGThe Pradhan Mantri Awaas Yojana–Urban (PMAY-U) launched in June 2015, the survey said, is one of the largest housing schemes of the world covering entire urban India and is being implemented through four verticals.The scheme is moving towards achieving the vision of “pucca” house to every household by 2020, it said adding 32 lakh houses have been completed and delivered.The survey noted that since the launch of the Smart City Mission in 100 cities, 5,151 projects worth more than Rs 2 lakh crore are at various stages of implementation and added a total of 1,290 projects worth Rs 22,569 crore have been completed and are operational.Making an attempt to quantify what a common person pays for a ‘thali’ across India, the Economic Survey said affordability of vegetarian ‘thalis’ improved by 29 percent while that of non-vegetarian by 18 percent during the 2006-07 to 2019-20 period.Dedicating a full chapter on “Through Thalinomics – The Economics of a Plate of Food in India”, the survey analysed data from the Consumer Price Index for industrial workers for around 80 centres in 25 states and Union Territories from April 2006 to October 2019 to arrive at the cost of a ‘thali’.As per the survey, a vegetarian thali comprises a serving of cereals, 'sabzi and dal' and the non-vegetarian thali comprises of cereals, sabzi and a non-vegetarian component.“Both across India and the four regions – north, south, east and west – it is found that the absolute prices of a vegetarian thali have decreased significantly since 2015-16 though the price has increased in 2019,” it said.As a result, the survey said, “An average household of five individuals that eats two vegetarian thalis a day gained around Rs 10,887 on average per year while a non-vegetarian household gained Rs 11,787, on average, per year.”India's development trajectory is critically linked with investments in social infrastructure and the country's march towards attaining Sustainable Development Goals (SDGs) is firmly anchored in investing in human capital and inclusive growth, the Economic Survey 2019-20 said.It suggested that scaling up development programmes for improving connectivity, providing housing and bridging gender gaps in socio-economic indicators is of paramount importance for sustainable developmentIt stated that the public investments in social infrastructure like education, health, housing and connectivity have a critical role in ensuring inclusive development in a developing country like India.It is recognised that ending poverty and other deprivations must go hand-in-hand with strategies that improve health and education, reduce inequality and spur economic growth in a sustainable manner, the survey said.The survey added that the government has been focusing on provisioning of assets such as schools, institutes of higher learning, hospitals, access to sanitation, water supply, road connectivity, affordable housing, skills and livelihood opportunities.Expenses of a student on books, stationery and uniform in rural India on an average are over 10 percentage points higher than those in urban areas, although participation in education system has seen improvement at all levels, according to the Economic Survey.It also noted that the absence of suitable financial support system and high burden of course fee, especially in higher education, pushes the poor and underprivileged out of the education system.THE DROPOUT PROBLEMCiting data from the National Sample Survey (NSS) report on 'Key Indicators of Household Social Consumption on Education in India 2017-18', the survey said that in 2017-18, there were about 13.6 percent persons of age 3 to 35 years who were never enrolled in the education system.“The reasons they cite for not enrolling were ‘not interested in education’ and ‘financial constraints’,” it said.Among those who were enrolled, drop-out rate was as high as 10 percent at primary level, 17.5 percent at upper primary/middle, and 19.8 percent at secondary level, the survey added.Highlighting the challenges for 'Education for All' initiative, the survey said the composition of various components of expenditure on education indicates that the course fees, which is 50.8 percent at all India level, among others contributes about half of the average expenditure of a basic course.Course fees include tuition, examination, developmental fees and other compulsory payments. The proportion of course fee is also high in rural and urban areas, it added.The survey also pointed out that students pursuing education in private aided institutions are spending significantly higher as compared to government institutions across rural-urban India.Quoting the NSS report, the survey said in 2017-18, the average expenditure of an average student in government institutions pursuing secondary education was Rs 4,078 whereas the same for a student in private aided institution was Rs 12,487.The government on Friday termed the micro, small and medium enterprises (MSME) sector as an important segment of the economy that fosters entrepreneurship and generates employment opportunities at lower capital cost.The survey also gave a detailed analysis of all the measures taken by the government to support the MSME sector to ensure better credit flow, technology up-gradation, ease of doing business and market access.In November 2018, the government had announced reforms aimed at expediting growth of the sector including in-principle approval for loans up to Rs 1 crore within 59 minutes through an online portal.According to the survey, 1,59,422 such loans have been sanctioned involving Rs 49,330 crore. Of this, Rs 37,106 crore has been disbursed up till October 2019.To achieve the target of doubling farmers' income by 2022, the Economic Survey said there is an urgent need to address some of the basic challenges like credit, insurance coverage and irrigation facilities in the agriculture and its allied sectors.Issues such as investment in agriculture, water conservation, improved yields through better farming practices, access to market, availability of institutional credit, increasing the linkages between agricultural and non-agricultural sectors need urgent attention, it said.As the proportion of small and marginal holdings is significantly large, land reform measures like freeing up land markets can help farmers improve their income, according to the survey.Noting that farm mechanisation helps the Indian farming transform into commercial from subsistence farming, the Survey said there is also a need to address the issue of lower farm mechanisation in India which is only about 40 percent as compared to about 60 percent in China and around 75 percent in Brazil.Stating that agriculture and its allied sectors still remain an important sector, the Survey said it is because of its continued role in employment, income and most importantly in national food security.Their contribution to national income has gradually declined from 18.2 percent in 2014-15 to 16.5 percent in 2019-20, reflecting the development process and the structural transformation taking place in the economy.(With inputs from PTI)

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‘Thalinomics’ to Smart Cities – All About Economic Survey 2020

Apart from projecting a “strong rebound” with 6-6.5% growth in 2020-21, here’s what the survey said.