The Economic Survey of 07 in many ways is too optimistic and oriented towards the Lok Sabha elections of 09, perhaps prematurely
March 8, 2007 (Press Release) --
New Delhi, 8th March, 2007: The Economic Survey of 07 in many ways is too optimistic and oriented towards the Lok Sabha elections of 09, perhaps prematurely. Assuming that the annual budget proposals and economic survey of the Government's appraisal of the economic barometer of the country, observers say there is many a slip between cup and lip.There are many sectors mentioned that could be on the ascendant, but many others that belie the optimism of the economic survey and budget finalisers.
All policy defining items inflation, growth, special economic zones, infrastructure, pension reforms have been discussed in the economic survey, but it seems it is all due to the political compulsions of the future two years.
One cannot fault Finance Minister Mr. P Chidambaram with uninhibited exaggerated statements. The survey is optimistic and at the same time cautious, bringing down optimism with emphasis on problems created by inflation.
While the Finance Ministry has been jumping from one defence to another to justify rising inflation – from blaming industry to inflation being a natural ally of a growing economy in this survey, there some attempt at coming to terms with data based analysis and conclusions. The high rate of price rise in primary articles food including cereals and pulses which rose 9.76% in the last week of January this year, compared to 5.78% one year ago contributed to more than one third of the overall inflation. Major items like pulses, groundnut oil, onions rose by an average of 25% many of which are reflected in global prices, resulting in price shocks.
Every year the Economic Survey gives an accurate picture of the financial status of the power sector. This year too there a table that paraphrases into a story of slow reforms, of mounting losses and therefore of ever-increasing state government subsidies. A media report indicates the rate of return in the sector has fallen from minus 24.84% in 2005 – 06 to minus 27.43% in 06-07. In financial terms this translates into all India losses of Rs. 26000 crores as against Rs. 21110 crores. But like in all surveys, it holds out promises of better results next year – touching -19%, close to the levels envisaged in the 1990s.
Moreover, the unemployment rate of the country may become the biggest headache after inflation for the UPA government, especially the urban jobless rate, survey data has shown. The way out - stepping up employment in the private sector, absorbing the extra manpower that is jobless due to a dip in the agricultural employment, pushing labour intensive and export oriented manufacturing industries and imparting skills to improve the employability of the youth.
Citing examples and finding of National Sample Survey Organisation the survey found that though employment increased faster between 1999-2000 and 2004-05, as compared to the period from 1993-94 to 1999-2000, the labour force expanded faster, leading to greater unemployment.
All policy defining items inflation, growth, special economic zones, infrastructure, pension reforms have been discussed in the economic survey, but it seems it is all due to the political compulsions of the future two years.
One cannot fault Finance Minister Mr. P Chidambaram with uninhibited exaggerated statements. The survey is optimistic and at the same time cautious, bringing down optimism with emphasis on problems created by inflation.
While the Finance Ministry has been jumping from one defence to another to justify rising inflation – from blaming industry to inflation being a natural ally of a growing economy in this survey, there some attempt at coming to terms with data based analysis and conclusions. The high rate of price rise in primary articles food including cereals and pulses which rose 9.76% in the last week of January this year, compared to 5.78% one year ago contributed to more than one third of the overall inflation. Major items like pulses, groundnut oil, onions rose by an average of 25% many of which are reflected in global prices, resulting in price shocks.
Every year the Economic Survey gives an accurate picture of the financial status of the power sector. This year too there a table that paraphrases into a story of slow reforms, of mounting losses and therefore of ever-increasing state government subsidies. A media report indicates the rate of return in the sector has fallen from minus 24.84% in 2005 – 06 to minus 27.43% in 06-07. In financial terms this translates into all India losses of Rs. 26000 crores as against Rs. 21110 crores. But like in all surveys, it holds out promises of better results next year – touching -19%, close to the levels envisaged in the 1990s.
Moreover, the unemployment rate of the country may become the biggest headache after inflation for the UPA government, especially the urban jobless rate, survey data has shown. The way out - stepping up employment in the private sector, absorbing the extra manpower that is jobless due to a dip in the agricultural employment, pushing labour intensive and export oriented manufacturing industries and imparting skills to improve the employability of the youth.
Citing examples and finding of National Sample Survey Organisation the survey found that though employment increased faster between 1999-2000 and 2004-05, as compared to the period from 1993-94 to 1999-2000, the labour force expanded faster, leading to greater unemployment.
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