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Economic Survey 2014-15

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Last updated: Jul, 2015

The Economic Survey 2014-15, was tabled in Parliament on February 27, 2015, by Mr Arun Jaitley, Union Minister for Finance, Government of India. The Survey forecasts a growth rate of over 8 per cent for FY16, as compared to the growth rate of 7.4 per cent in FY15. As per the Economic Survey, India must adhere to medium-term fiscal deficit target of 3 percent of the country’s gross domestic product (GDP). Robust reforms, push for Make in India and a better external environment indicate adouble-digit growth trajectory, highlighted the Survey.

The main highlights of the survey are:

  • Over 6 per cent points decline in inflation since late 2013.
  • Current Account Deficit down from a peak of 6.7 per cent of GDP (in Q3, 2012-13) to an estimated 1 per cent in 2014-15.
  • Foreign portfolio flows have stabilized the rupee.
  • Real GDP growth at 7.2 per cent since 2013-14, after a nearly 12-quarter phase of deceleration.
  • Inflation likely to remain in the 5-5.5 per cent range, creating space for easing of monetary conditions.
  • GDP growth expected to accelerate between 8.1 and 8.5 per cent in 2015-16.
  • Fiscal deficit target of 4.1 per cent appears achievable.
  • Private investment to be the engine of long-run growth.
  • Case for reviving targeted public investment as an engine of growth in the short run to complement and crowd-in private investment.
  • India must adhere to medium-term fiscal deficit target of 3 percent of GDP.
  • Expenditure control with growth recovery and GST will ensure that medium-term targets are met.
  • The quality of expenditure needs to be shifted from consumption to investment.
  • The direct fiscal cost of all the subsidies is roughly Rs 378,000 crore (US$ 61.15 billion) or 4.2 percent of 2011-12 GDP.
  • JAM Number Trinity – Jan Dhan Yojana, Aadhaar, Mobile can enable the State to transfer financial resources to the poor in a progressive manner without leakages and with minimal distorting effects.
  • Econometric evidence suggests that the railways public investment multiplier (the effect of a Rs 1 (US$ 0.016) increase in public investment in the railways on overall output) is around 5.
  • India has cut subsidies and increased taxes on fossil fuels (petrol and diesel along with a coal cess) turning a carbon subsidy regime into one of carbon taxation. The implicit carbon tax is US$ 140 for petrol and US$ 64 for diesel.
  • FFC transfers are highly progressive; that is, states with lower per capita NSDP receive on average much larger transfers per capita.
  • Food grain production for 2014-15 estimated at 257.07 million tonnes (MT); to exceed that of last 5 years by 8.5 million tonnes.
  • Food Subsidy Bill stands at Rs 107,823.75 crore (US$ 17.43 billion) during 2014-15 (upto January, 2015), an increase of 20 per cent over previous year.
  • Groundnut production increased by a massive 105.8 per cent in 2013-14, shows a remarkable increase of 75.9 per cent in productivity.
  • Agriculture and allied sectors contribute 18 per cent to GDP and has grown by 3.7 per cent in 2013-14.
  • Indian higher education system is one of the largest in the world with 713 universities, 36,739 colleges and 11,343 diploma-level institutions.
  • As of December 2013 over 720 million citizens had been allocated an Aadhaar card. By December 2015 the total number of Aadhaar enrolments in the country is expected to exceed 1 billion.
  • With over 900 million cell phone users and close to 600 million unique users, mobile money offers a complementary mechanism of delivering direct benefits to a large proportion of the population. And this number is increasing at a rate of 2.82 million per month.
  • India has the largest postal network in the world with over 155,015 post offices of which (89.76 percent) are in the rural areas.
  • Recovery of industrial production is led by the infrastructure sectors namely electricity, coal and cement.
  • Civil aviation sector has seen healthy increase in international passengers and cargo handled at Indian airports during 2014-15.
  • Major initiatives are implementation of public-private partnership (PPP) projects at four airports of the AAI, setting up of greenfield airports and development of small airports in tier II and tier III cities.
  • India's National Solar Mission being scaled up five-fold to 100,000 megawatts (MW).
  • Clean energy cess doubled to Rs 100 (US$ 1.61) per tonne to mop up Rs 17,000 crores (US$ 2.74 billion) in NCEF.

Click here for more details on the Economic Survey 2014-15.