Presenting the Economic Survey 2021 report, Chief Economic Advisor KV Subramaniam said that the credit rating method is not right. We are suffering from this.
Chief Economic Advisor KV Subramanian, in his address on the Economic Survey Report 2021, thanked the Finance Minister, the Prime Minister and all the people in his team. He said that this year’s Economic Survey Kovid Warriors are dedicated. According to this report, the growth rate minus in the current financial year (2020-21) is expected to be 7.7 per cent, while the growth rate for FY 2021-22 is estimated at 11 per cent.
We implemented a timely lockdown which was the tightest in the world. Apart from this, we also gave relief in economic activities at the right time. In this way we managed to stop the second web of Corona in India and economic activities are also fast returning to the track. This has been possible due to strong policies.
Saving life is our first priority
Corona is a coming-of-age crisis. For example, if a person becomes corona in Mumbai local, then hundreds of people may fall prey to it. We worked to stop this in India. Speaking to a quote from Mahabharata, KV Subramaniam said that we first focused on protecting life. All our policies were designed under this.
Demand fell due to spending cuts
Due to Corona, both demand and supply side problems arose in the economy. We need to understand that whenever a crisis comes, people avoid spending and they save their savings for difficult times. This is the reason that demand crisis has arisen due to corona epidemic. The corporate of the country also proceeded on the same lines, which is why there has been a significant decline in consumption.
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Timely lockdown and unlock decided
We implemented a timely lockdown which was the tightest in the world. Apart from this, we also gave relief in economic activities at the right time. In this way we managed to stop the second web of Corona in India and economic activities are also fast returning to the track. This has been possible due to strong policies.
The way of rating is not right, the loss is happening
KV Subramaniam questioned the rating pattern on behalf of international agencies. He said that the method of rating is not right. This causes us to suffer loss. The current rating is not properly describing the fundamentals of India’s economy. This has a negative effect on foreign investment which is not good. India’s intention to repay its debt is gold standard, its ability to repay debt is also very strong. We are doing better on all aspects. In such a situation, credit rating needs to be improved.
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What about credit ratings?
Regarding sovereign credit ratings, he said that it is not showing economic fundamentals. He said that when a country becomes the fifth largest economy in the world, its rating increases. His rating is usually AAA. When China became the fifth largest economy in 2005, its rating was A-. When India becomes the fifth economy, its rating is BBB +.
Debt will fall in all circumstances
Regarding the huge debt burden on the government, it said that even if the growth rate is only 3.8% every year from FY 2023 to FY29, then the debt will also be registered. According to a Reuters report, the focus of Nirmala Sitharaman will be on fiscal expansion. In this budget, the government will focus exclusively on disinvestment. Apart from this, loans will be raised on a large scale from the market so that spending can be accelerated.
Debt is not a big problem
Regarding the fiscal policy, KV Subramaniam said that if the growth rate is higher than the interest rate, then there is not much pressure on the fiscal position. In other words, if the government took a loan of 100 rupees and is paying an interest of 4 rupees annually on it. In one year he earned 12 rupees from 100 rupees. This means that the government is in the benefit of 8 rupees by giving an interest of 4 rupees. In the US and other advanced economies, the interest rates are very low and the growth rate is also low. Talk about India, our growth rate is very high. So date is not a big issue. As long as the growth rate is higher than the interest rate, the government has the possibility of a fiscal policy.
There will be a large expenditure on infra
Regarding the investment, he said that the government will spend faster on the national infrastructure pipeline of 110 lakh crores. This will also speed up private investment. Investment contributes to 28 percent of India’s GDP. The Chief Economic Advisor said that if there is a spurt in investment, new opportunities for employment will be created and productivity will increase.
Indian agriculture contributes to green shoots of the Indian #Economy with a Growth Rate of 3.4 % despite #COVID19 Pandemic
Recent agricultural reforms a remedy, not a malady says #EconomicSurvey
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3.4% increase in agricultural sector
Despite the Corona crisis, the agricultural sector recorded a great boom. It is estimated to grow by 3.4 percent in the current financial year. Regarding the recently passed three agricultural laws, KV Subramaniam said that these are measures for reform. This will improve the situation of farmers.
