More spending on health, education must: Survey
Spending on social services in India grew by 11.5 per cent to Rs 11,18,094 crore in 2016-17, but the country needs to strengthen social infrastructure by investing in health and education as it is emerging as a knowledge-based economy, Economic Survey said on Friday.
The mid-year survey, tabled in Parliament, also said that although India's social policies have focused on welfare of the people, challenges remain in overcoming social and economic barriers to advance capabilities of the marginalised, women and other weaker sections of the society.
The total expenditure on social services, including art and culture, family welfare, housing, urban development, welfare of SCs, STs and OBCs, besides health and education, was Rs 10,02,591 in 2015-16, it said.
Expenditure on education has grown from 2.8 per cent in 2014-15 to 3.2 per cent of the GDP in FY17, while health sector saw it going up up from 1.2 per cent in 2014-15 to 1.5 per cent in the last fiscal, Economic Survey said.
"The expenditure on social services by the Centre and States as a proportion of GDP which remained stagnant in the range of 6 per cent during 2011-12 to 2014-15, recorded an increase of 1 percentage point during 2015-16 and 2016-17," the survey tabled said. As percentage to GDP, the expenditure on social services was at 7.4 per cent during the fiscal.
While expenditure of education during the fiscal stood at Rs 4,74,672 crore as against Rs 4,23,171 crore previous fiscal, health sector saw expenses of Rs 2,21,466 crore compared to Rs 1,91,141 crore in FY16, as per the survey.
"India is emerging as a knowledge based economy, poised for double digit growth, and needs to strengthen social infrastructure by investing in health and education," said the survey authored by Chief Economic Adviser Arvind Subramanian.
Stating that on the Global Hunger Index (GHI) 2016, India ranks 97 out of 118 developing countries with prevalence of stunting among children aged below 5 years at around 39 per cent, the survey said it requires effective investments in social infrastructure in order to achieve the Sustainable Development Goals (SDGs).
Besides, the survey said, India's rank in Human Development Index (HDI) is at 131 out of 188 countries as per HDR, 2016, leaving much to be desired.
It said the government is committed to achieving Sustainable Development Goals for health that ensures healthy lives for all at all ages by 2030. Towards this, it has formulated the National Health Policy, 2017, which aims at attaining the highest level of good health and well-being, through preventive and promotive health care orientation. pti
Private investment cycle needs to be revived for growth, job creation: Ficci
Reacting to the Economic Survey 2016-17 Volume II released earlier on Friday, industry chamber Ficci said "The Survey clearly lays out the opportunities and the risk factors that could have a bearing on the near to medium term growth performance of the Indian economy.
":While developments such as introduction of GST, in principle decision to privatize Air India, steps taken to address the twin balance sheet problem and the continuous roll out of reforms across segments lend confidence, there is an element of anxiety on account of factor such as farm loan waivers, dip in non-cereal food prices and weakening performance of sectors such as power and telecommunications. "
"There is a need to substantially cut down policy rates by the RBI and ensure its full transmission by the banks in the form of lower lending rates for consumption and investment activities. A cut in interest rates would spur demand, push up capacity utilisation rates and help reduce pressure on corporate balance sheets. thereby enabling them to plan for fresh investments."
"Unless the private investment cycle revives, sustaining growth and generating jobs in large numbers will be difficult", Ficci added.
'Inflation to stay below RBI's 4% target'
Signalling price stability, the Economic Survey-II on Friday said retail inflation at the end of March 2018 will remain within RBI's medium term target of 4 per cent.
In a first, the government on Friday presented second or mid-year Economic Survey for 2016-17, highlighting newer factors the economy faces.
The Survey said the fact that current inflation is running well below the 4 per cent target suggests that inflation by March 2018 is likely to come in below the RBI s medium term goal of 4 per cent.
It dubbed the current low level of inflation "a historic moment", instilling confidence in price stability.
According to the Survey, CPI inflation declined to 4.5 per cent during 2016-17, with a broad-based price decline in all major commodity groups. It has been below 4 per cent for the past eight months.
It noted that the economy underwent a transition -- possibly, structural and permanent -- from high to low inflation in the last three years.
"Significant moderation in CPI headline inflation during the last three years. CPI inflation fell to a series low of 1.5 per cent in June 2017," the Survey noted.
Noting that most states and UTs saw a sharp decline in CPI inflation in 2016-17 compared with the previous year, the document stated, "Both rural and urban inflation declined in 2016-17 and the gap between rural and urban inflation has narrowed in recent months."
In sum, the Survey pointed out that geo-political risks are simply not as risky as earlier.
"Technology has rendered India less susceptible to the vicissitudes of geo-economics (OPEC) and geo-politics (the Middle-East)," it added.