Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey...
Transcript of Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey...
![Page 1: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/1.jpg)
Economic Survey 2017-18
Analysis (Part 1)
Shyam S Kaggod
![Page 2: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/2.jpg)
Economic Survey – Important Points
• Two Volumes• Volume 1-Theoreotical
• Volume 2-Factual
• Do not read all the pages of Vol 2
• Supplement the information from the budget
• Questions can from both the volumes in both Prelims and Mains
![Page 3: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/3.jpg)
Vol 1-Contents• State of the Economy: An Analytical
Overview and Outlook for Policy
• A New, Exciting Bird’s-Eye View of the Indian Economy Through the GST
• Investment and Saving Slowdowns and Recoveries: Cross-Country Insights for India
• Reconciling Fiscal Federalism and Accountability: Is there a Low Equilibrium Trap
• Is there a “Late Converger Stall” in Economic Development? Can India Escape it?
• Climate, Climate Change, and Agriculture
• Gender and Son Meta-Preference: Is Development Itself an Antidote
• Transforming Science and Technology in India
• Ease of Doing Business’ Next Frontier: Timely Justice
Vol 2-Contents• An Overview of India’s Economic
Performance in 2017-18
• Review of Fiscal Developments
• Monetary Management and Financial Intermediation
• Prices and Inflation
• Sustainable Development, Energy and Climate Change
• External Sector
• Agriculture and Food Management
• Industry and Infrastructure
• Services Sector
• Social Infrastructure, Employment and Human Development
![Page 4: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/4.jpg)
Some achievements
• GST council provides an opportunity
• IBC to take care of TBSP
• Rationalization of revenue expenditure
V1C1
![Page 5: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/5.jpg)
Two Vulnerabilities – Twin Deficits
• FD
• CAD
V1C1
![Page 6: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/6.jpg)
How to overcome FD?
V1C1
![Page 7: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/7.jpg)
How to overcome CAD?
• Promote exports
• Promote Make In India
V1C1
![Page 8: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/8.jpg)
Indian Decoupling
V1C1
![Page 9: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/9.jpg)
Indian Decoupling-Reasons-Real Interest Rates (MP)
V1C1
![Page 10: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/10.jpg)
Reasons for Decoupling – Real Interest Rates
V1C1
![Page 11: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/11.jpg)
Indian Decoupling-Reasons-Demonetization
V1C1
![Page 12: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/12.jpg)
Indian Decoupling-Reasons-TBS Challenge
V1C1
![Page 13: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/13.jpg)
Indian Decoupling-Reasons-TBS Challenge
V1C1
![Page 14: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/14.jpg)
Indian Decoupling-Reasons-Oil Prices
V1C1
![Page 15: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/15.jpg)
Outlook
• For 2017-18
• For 2018-19
V1C1
![Page 16: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/16.jpg)
The government needs to
• Banking Reforms (Recapitalization and Consolidation)
• Stable GST
• Privatizing Air India
• Counter disruptions to the economy
V1C1
![Page 17: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/17.jpg)
The Global Outlook
• As per the World Economic Outlook, the global GDP growth • 2016 - 3.2%
• 2017 - 3.6%
• 2018 - 3.9%
V1C1
![Page 18: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/18.jpg)
GST
• Is a unified indirect tax
• Is a destination/consumption based tax
• Came into effect from 1st July 2017
• Will lead to creation of a national market
• GST has a dual structure
• One hidden benefit is – Repository of Information
V1C2
![Page 19: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/19.jpg)
Taxpayer Base
V1C2
![Page 20: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/20.jpg)
Tax base & Spatial distribution
• The size of the tax base and Revenue Neutrality
• The concern of the manufacturing states that a destination based
V1C2
![Page 21: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/21.jpg)
Concern of the manufacturing states
V1C2
![Page 22: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/22.jpg)
Size of the firms and their transactionsV1C2
![Page 23: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/23.jpg)
International Trade, Inter-state trade and Economic Prosperity
• 5 states-Maharashtra, Gujarat, Karnataka, Tamil Nadu and Telangana-account for 70% of India’s exports
• The inter-state trade in India is above 60% of the GDP• The five largest exporting states are Maharashtra, Gujarat, Haryana, Tamil
Nadu and Karnataka
• The five largest importing states are Maharashtra, Tamil Nadu, Uttar Pradesh, Karnataka and Gujarat
V1C2
![Page 24: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/24.jpg)
Relation between prosperity and exports
V1C2
![Page 25: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/25.jpg)
Formality and Informality of the Economy
V1C2
• Hard core Formal (part of tax net & social security net)
• Purely Informal
![Page 26: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/26.jpg)
Savings & Investment - Gross Capital Formation
Gross Savings
Private
Households
(Financial and Physical)
companies
Public
V1C3
![Page 27: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/27.jpg)
GCF
GFCF
Infrastructure such as building, machinery, means of transport,
roads, canal etc
Stock
Change in raw materials, inventories, finished/semi-finished
goods etc
V1C3Gross Capital Formation
![Page 28: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/28.jpg)
Savings and Investment2003 (% of GDP) 2007 (% of GDP) 2017 (% of GDP)
GFCF 26.5% 35.6% 26.4%
Domestic Savings 29.2% 38.3% 29% (for 2016)
V1C3
![Page 29: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/29.jpg)
Savings & Investment
V1C3
![Page 30: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/30.jpg)
Changes in Savings/Investments
V1C3
![Page 31: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/31.jpg)
Two questions
• What should be given more priority – policies to promote investment or policies to promote savings?
• What is the solution?
V1C3
![Page 32: Economic Survey 2017-18 Analysis (Part 1) Shyam S Kaggod · 2018-02-05 · Economic Survey –Important Points •Two Volumes •Volume 1-Theoreotical ... An Analytical Overview and](https://reader033.fdocuments.net/reader033/viewer/2022043009/5f9ba6eed8534000b16c2a42/html5/thumbnails/32.jpg)
Way Out
• The government has already• Stepped up public investment
• IBC
• Further it needs to• Easing the costs of doing business
• Creating a clear, transparent and stable tax and regulatory environment
• Creating a conducive environment for small and medium industries to prosper and invest, which will revive private investment
V1C3