Prime Minister Narendra Modi will chair an all-party meet today ahead of the budget session to present the government’s legislative agenda for the budget. The meeting will be held virtually and according to the PM an invitation has been extended to leaders of all parties. A lot of expectations are set on this year’s budget to save India’s dwindling economy. The budget will be delivered by Finance Minister Nirmala Sitharaman on 1st February. Ahead of the budget, economic survey was tabled on 29th January.
Prime Minister Modi referring to this year’s budget remarked, “This is the Budget Session. For the first time in India’s history, in a way, the Finance Minister had to present 4-5 mini budgets in 2020 in the form of different packages. So this Budget will be seen as a part of those 4-5 mini budgets, I believe this,”
The Finance Ministry’s 2021 Economic Survey has projected that India’s GDP Would grow by 11% (adjusted for inflation) in the financial year 2021-22. However the size of the Indian economy in terms of GDP is expected to contract by 7.7% in this financial year and thus the projected 11% is on this lower base. This means that GDP in 2021-22 will be just 2.4% more than GDP in 2019-20. This implies that nearly two years of economic growth will be lost just to achieve pre-COVID level. The survey’s projection is consistent with IMF’s prediction of 11.5% GDP growth for India.
Since the government couldn’t earn what it expected to earn in the budget of fiscal year 2019-20, fiscal deficit of the government is expected to rise this year. It means that government spending will exceed government earnings this year. Out of all the major sectors only the agricultural sector is expected to grow this year. It is projected that it will grow by 3.4%.
This year’s Economic Survey was delivered in ebook format, with an official app for the survey.