Economic Survey 2023: Realistic than being illustrious

NEW DELHI, FEB. 1: Economists study the present, in the light of the past, for future purposes. But keeping up with this basic Keynesian standard in these non-normal times has become such a challenge that economists were missing estimates with each heartbeat.

But India’s Chief Economic Adviser (CEA) Dr V Anantha Nageswaran, perhaps, considered the job of drafting the Economic Survey 2023, as either a daring adventure or nothing at all.

Softly declaring at the outset that the country’s economic recovery was complete, he pegged nominal GDP growth of 11 per cent and a real rate of 6.5 per cent for FY24. That’s the lowest in three years. But hey, neither the public nor the markets are in the mood for fairytales. And the only respectable way, is to be realistic than being illustrious.

But events, dear boy, can upset even the modest plans. So Nageswaran used an intelligent way to ensure that his numbers don’t end up dust and ashes. He backed up the 6.5% baseline projection for FY24 GDP, with a copper-bottomed band of 6-6.8%, though even that’s subject to global oil prices staying below $100 per barrel.

Tabled in the Parliament on Tuesday, the Survey, confirmed the pains of a soul-crushing FY23 and how India withstood the extraordinary set of challenges better than most economies. But as the CEA noted, the world continues to battle known unknowns, alongside the Knightian uncertainties (lack of quantifiable knowledge about possible occurrences).

Confirming more than once that the Indian economy has covered the lost ground, he then went on to reveal his own estimates of 6.5-7 per cent growth for the next fiscal. As Nageswaran explained, the stars seems to have aligned for India’s disrupted financial cycle and given the potential in physical and digital infrastructure expansion, another 15-100 bps addition was likely to the trend growth.

“We don’t have to speak of pandemic recovery anymore, we have to look ahead to the next phase,” he asserted.

-TNIE