Economic Survey 2024/2025 - Part 02

Economic Survey 2024/2025 - Part 02

(இதன் தமிழ் வடிவத்திற்கு இங்கே சொடுக்கவும்)

• Prices and Inflation: Understanding the Dynamics
• Global Inflation Trends:
• Global inflation moderated to 5.7% in 2024, down from 8.7% in 2022 (IMF).
• India’s Inflation:
• Retail inflation in India reduced from 5.4% in FY24 to 4.9% in FY25 (April–December 2024).
• Inflation Targeting:
• RBI and IMF forecast India’s consumer price inflation to gradually align with the target of around 4% by FY26.
• Climate-Resilient Agriculture:
• Development of climate-resilient crop varieties and improved farming practices are key to mitigating extreme weather effects and ensuring long-term price stability.

• Medium-Term Outlook: Deregulation Drives Growth
• Geo-Economic Fragmentation (GEF):
• India is undergoing transformation amid unprecedented economic challenges and opportunities.
• GEF is replacing globalization, leading to economic realignments.
• Growth Target for Viksit Bharat 2047:
• India needs an average growth rate of 8% for 10–20 years to achieve the vision of "Viksit Bharat" (Developed India) by 2047.

• Global Realities:
• The medium-term growth outlook must consider new global realities such as GEF, China’s manufacturing strength, and reliance on China for energy transition.

• Deregulation and Economic Freedom:
• India aims to focus on systematic deregulation to drive domestic growth.
• Systemic deregulation is seen as the key policy priority to bolster medium-term growth.
• Focus on Ease of Doing Business 2.0:
• The focus will be on enhancing the Ease of Doing Business through reforms and creating a viable Mittelstand (MSME sector).

• State-level Reforms:
• States are encouraged to liberalize standards, reduce tariffs, apply risk-based regulations, and establish legal safeguards for enforcement.
• Investment and Infrastructure: Keeping it Going
• Public Spending on Infrastructure: Focused on increasing public infrastructure spending and mobilizing resources.
• Capital Expenditure Growth: 38.8% growth in capital expenditure on infrastructure from FY20 to FY24.
• Railway Network Expansion: 2031 km of railway network commissioned (April-November 2024), 17 new pairs of Vande Bharat trains introduced.

• Road Network Expansion: 5853 km of National Highways constructed in FY24 (April-December).

• Industrial Corridor Development: 383 plots covering 3788 acres allotted in phase 1 under the National Industrial Corridor Programme.
• Port Efficiency: Container turnaround time reduced from 48.1 hours to 30.4 hours (FY25, April-November).
• Renewable Energy Growth: 15.8% increase in solar and wind power capacity, renewable energy accounts for 47% of total installed capacity.
• Rural Electricity Access: 18,374 villages electrified, 2.9 crore households given electricity.

• Digital Connectivity: 5G rollout completed across all states by October 2024, 10,700+ villages covered with 4G by December 2024.
• Water Access: Over 12 crore families gained access to piped drinking water under the Jal Jeevan Mission.
• Swachh Bharat Mission: 1.92 lakh villages declared ODF Plus in Phase II (April-November 2024).
• Housing Initiatives: 89 lakh houses completed under Pradhan Mantri Awas Yojana (PMAY).
• Urban Transportation: Metro and rapid rail systems expanded in 29 cities, covering over 1,000 km.
• Real Estate Sector Regulation: 1.38 lakh real estate projects registered and 1.38 lakh complaints resolved.
• Space Sector: India operates 56 active space assets, including the Gaganyaan and Chandrayaan-4 missions.

• Public-Private Collaboration: National Infrastructure Pipeline and Monetisation Pipeline foster private sector participation.
• Industry: All About Business Reforms
• Industrial Sector Growth: Expected to grow by 6.2% in FY25, driven by electricity and construction.
• Smart Manufacturing & Industry 4.0: Promoted through SAMARTH Udyog centres.

• Automobile Sector Growth: Domestic automobile sales grew by 12.5% in FY24.
• Electronics Manufacturing: 99% of smartphones manufactured domestically, CAGR of 17.5% in electronics production (FY15-FY24).
• Pharmaceutical Sector: Turnover of ₹4.17 lakh crore in FY24, growing at 10.1% CAGR over the past five years.
• Patent Filings: India ranks 6th globally in patent filings (WIPO Report 2022).

• MSME Growth: Key economic driver, with the Self-Reliant India Fund providing ₹50,000 crore for equity funding.
• Cluster Development: Government implementing the MSME Cluster Development Programme nationwide.
• Services:
• Growth in Services Sector: Contribution to total GVA increased from 50.6% in FY14 to 55.3% in FY25.
• Global Share in Services Exports: India held 4.3% of global services exports in 2023, ranking 7th.

• Information & Computer Services: Grew at 12.8% over the last decade, with a GVA share increase from 6.3% to 10.9%.
• Railway Growth: 8% increase in passenger traffic and 5.2% growth in freight revenue (FY24).
• Tourism Sector: Contribution to GDP returned to 5% in FY23, pre-pandemic level.
• Agriculture and Food Management: Sector of the Future
• Agriculture’s Contribution to GDP: Contributed 16% to GDP in FY24.

• Growth in High-Value Agriculture: Key growth drivers include horticulture, livestock, and fisheries.

• Kharif Food grain Production: Expected to reach 1647.05 LMT, an increase of 89.37 LMT from last year.
• Minimum Support Price (MSP): MSP for Arhar and Bajra increased by 59% and 77%, respectively, in FY25.
• Fisheries and Livestock Growth: Fisheries sector grew at 8.7% CAGR, livestock at 8%.
• Food Security Measures: PMGKAY continues to provide free food grains for five more years.
• Farmer Welfare Schemes: 11 crore farmers benefitted from PM-KISAN; 23.61 lakh enrolled in PM Kisan Mandhan.

• Climate & Environment: Adaptation Matters
• India’s Ambition for Sustainable Development: Vision to become a developed nation by 2047, rooted in sustainability.
• Non-Fossil Fuel Electricity Generation: 46.8% of total installed capacity from non-fossil fuel sources by Nov 2024 (213,701 MW).

• Forest Carbon Sinks: India created an additional 2.29 billion tonnes of CO₂ equivalent carbon sink (2005-2024).
• Lifestyle for Environment (LiFE): India leads the global LiFE movement, promoting eco-friendly lifestyles.

• LiFE Impact: Could save USD 440 billion globally by 2030 through reduced consumption and lower prices.
• Social Sector: Extending Reach and Driving Empowerment
• Social Services Expenditure: Government spending grew at a 15% CAGR from FY21 to FY25.
• Declining Income Inequality: Gini coefficient in rural areas dropped from 0.266 to 0.237, and in urban areas from 0.314 to 0.284 (2022-2024).
• Government Health Expenditure: Government share increased from 29% to 48%, reducing out-of-pocket expenditure from 62.6% to 39.4%.
• Ayushman Bharat PM-JAY: Led to ₹1.25 lakh crore savings in healthcare expenditures.

• Localization of SDGs: Budgeting at the Gram Panchayat level aligns with SDG objectives.
• Employment and Skill Development: Existential Priorities
• Labour Market Improvement: Unemployment rate decreased to 3.2% in 2023-24 from 6.0% in 2017-18.
• India’s Demographic Advantage: 26% of India’s population is in the 10-24 age group, making it one of the youngest nations globally.

• Women’s Entrepreneurship: Government initiatives support women entrepreneurs with credit access, marketing, skill development, and startup assistance.
• Emerging Job Opportunities: Growing sectors like digital economy and renewable energy are expected to generate significant employment.
• Skilled Workforce Development: Government is developing a skilled workforce to adapt to trends like automation, AI, digitalization, and climate change.
• PM-Internship Scheme: Transformative scheme for employment generation.

• Formal Employment Growth: Net payroll additions under EPFO have more than doubled in the past six years, signalling growth in formal employment.
• Labour in the AI Era:
• AI's Impact on the Workforce: AI is expected to surpass human performance in decision-making across sectors like healthcare, education, and business.
• Barriers to AI Adoption: Challenges include concerns over reliability, inefficiency, and infrastructure deficits, providing a window for policymakers.
• India’s Window of Opportunity: India has time to build foundations and create an institutional response for AI’s future impact.
• Augmented Intelligence: Future work will integrate human capabilities with machine intelligence to enhance efficiency and potential.
• Collaboration for AI Integration: Government, private sector, and academia must collaborate to minimize the adverse effects of AI transformations.

• Positive Growth Outlook
• India’s economy is on a positive trajectory with expected growth between 6.3% and 6.8% in FY26, signalling resilience despite global challenges.
• Impact of Structural Reforms
• Structural reforms in key sectors, such as infrastructure, industry, and digital services, are expected to drive sustainable long-term growth.
• Commitment to Development
• The government's focus on inclusive development, with initiatives in social services, agriculture, and skill development, aims to strengthen India's position as a global economic leader.
• Navigating Global Uncertainty
• India’s strategy of resilience amid global economic shifts, coupled with deregulation and ease of doing business, will be crucial to harnessing opportunities in the evolving global landscape.

• Path to 'Viksit Bharat'
• With continued reforms, strategic investments, and a focus on technology-driven growth, India is on track to achieve its vision of becoming a developed nation by 2047.

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