Indian Economic Survey 2009-10
The Economic Survey presented to Parliament on 25th Feb 2010 says that the economy has bounced back from the global economic slowdown and is on its way to the growth path of 9 per cent. The CSO estimate of 7.2 per cent GDP growth for 2009-10 reflects the fast paced recovery given the Index of Industrial Production (IIP) posting a record 16.8 per cent year-on-year growth during the month of December 2009.
The Survey says that the economy has responded well to the policy measures undertaken in the wake of global financial crisis. It says, the adverse impact due to the delayed and sub-normal monsoon has been contained to a large extent and a better than average rabi agricultural season is expected. The Survey says that the recovery is well founded with pick up in merchandise exports, capital flows and non-bank food credit.
The turnaround came in the second quarter of 2009-10 when the economy grew by 7.9 per cent, year-on-year basis. The CSO estimates forecast 7.2 per cent growth in GDP with industrial output growing at 8.2 per cent and service sector at 8.7 per cent. The recovery is particularly impressive despite a decline of 0.2 per cent in agriculture output primarily due to sub-normal monsoon. The Survey says, the broad based nature of the recovery creates scope for a gradual roll back, in due course, of some of the measures undertaken over the last 15 to 18 months to put the economy back on the growth path of 9 per cent.
The Survey expresses concern over the emergence of high double-digit food inflation especially in the second half. Food price inflation stood at 17.9 percent for the week ended January 30, 2010 while the inflation in fuel, power, light and lubricant at 10.4 per cent. It says that the significant part of this inflation can be explained by supply side bottlenecks in some essential commodities. Since December 2009, there have been signs of these high food prices, together with hardening of non-administered fuel prices, getting transmitted to other non-food items. This has created some concerns for higher than anticipated generalized inflation over the next few months.
The recovery in GDP growth as indicated in the CSO advance estimates is broad- based with 7 out of 8 sectors/sub-sectors showing a growth rate of 6.5 per cent or higher. The per capita growth in income has recovered to 5.3 per cent in 2009-10 from 3.7 per cent in the previous year. The per capita consumption growth as reflected in the private final consumption expenditure shows a declining trend since 2007-08.
The Survey says that the country received 23 per cent less rainfall during the south-west monsoon 2009 but some of the shortfall was made up during the post monsoon season when the country received 8 per cent excess rainfall. Kharif 2009-10 season showed a decline of nearly 6.5 per cent in acreage with the entire decline confined to rice crop. While the decline in Kharif acreage under pulses was 5.63 per cent, some of this decline has been made up in the rabi season. As per the available estimates, wheat, pulses and groundnut have seen an increase in acreage as compared to last year.
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Indian Economic Survey 2008-09