Highlights of Economic Survey 2006-07

Following are the highlights of the Economic Survey 2006-07 presented by Finance Minister P Chidamabaram in Parliament on Tuesday:

• GDP to grow 9.2%, touch Rs 28,44,000 crore in 2006-07
• Inflation at 6.7% on February 3 a matter of concern
• Govt's top priority: Growth without high inflation
• Risks: volatile oil prices, delays in WTO talks
• Risks: Global macroeconomic imbalances
• Priorities: Making growth inclusive
• Priorities: Fiscal prudence, high investment
• Priorities: Improving govt intervention in critical areas such as education and health
• Priorities: Subsidies to be targeted
• Agriculture to grow 2.7%, share in GDP dips to 18.5%
• Industry to grow at 10%, share in GDP up to 26.4%
• Services to grow at 11.2%, share in GDP rises to 55.1%
• 10th plan average GDP growth at 7.6% vs targeted 8%
• Average inflation in 52 weeks ending Feb 3 at 5%
• Food items, wheat, pulses, sugar driving inflation
• In industry, mining, gas and power issues of concern
• Current account deficit at $11.7 billion in H-1 of FY07
• Exports up 36.3% to $89.5 bn in April-Dec 2006-07
• Capital flows strong, FDI up 98.4% in Apr-Sept 2006-07
• FIIs sellers in H-1, but likely to be positive in H-2
• Core sector growth 8.3% vs 5.5% in Apr-Dec 2006-07
• Stock markets buoyant, market cap rises to 91% of GDP
• Rs 161,769 crore raised from IPOs in 2006
• Mutual funds raise Rs 104,950 cr in 2006, up four-fold
• Corporate tax collections up 55.2% in Apr-Dec FY07
• Tourism earnings cross $6.6 bn in 2006
• Gross domestic savings rate up at 32.4% in 2005-06
• Gross domestic investment rate at 33.8% in 2005-06
• Gross fixed capital formation rises to 28.1% in 2005-06
• Savings of private corporates rise sharply at 8.1%
• High savings rate to continue
• Govt final consumption expenditure up 11.5% in FY06
• Saving-investment gap turns negative at 1.3%
• Govt to miss 2007 target of elementary education to all
• Employment rate grows to 2.5% in 1999-2005
• Decline in organised sector jobs
• Unemployment rate up to 3.1% in 2004-05
• Poverty down at 22% in 2004-05 vs 26.1% in 1999-2000
• Population to stabilise around 2045
• Infrastructure to require $320 bn in 11th plan
• Public sector to fund 60 per cent of infrastructure
• Fiscal deficit budgeted at 3.8% in 2006-07
• Tax-GDP ratio rises to 11.2% FY07 vs 10.3% in FY06
• Personal income tax mop up rose 30.3% in Apr-Dec FY07
• Share of direct taxes in total revenues grows to 47.6%

Security market

• Stock market scaled new peaks with Bombay Stock Exchange and National Stock Exchange indices crossing the 14,000 and 4,000 marks respectively in January 2007.
• Primary capital market remained upbeat, aggregate resource mobilisation through Initial Public Offering and private placements much higher in the calendar year 2006 as compared to previous year.
• 75 IPOs issued during the year 2006, on average 6 IPOs per month.
• Rs 24,779 crore (Rs 247.79 billion) raised through 75 IPOs, which accounted for 76 per cent of resources mobilized through equity during the calendar year 2006.
• Sensex and Nifty indices rose by 46.7 per cent and 39.8 per cent respectively on a point-to-point basis during 2006.
• With stock indices soaring, investors wealth as reflected in market capitalization also increased significantly by over 45 per cent during 2006.
• NSE and BSE spot market turnover more than doubled between 2003 and 2006. In respect of derivatives, the turnover of NSE nearly doubled in a single year between 2005 and 2006.
• Number of foreign institutional investors rose by 27 per cent to 1044 at the end of 2006.
• Assets under management of mutual funds increased by about Rs 124,000 crore to reach Rs 324,000 crore in 2006.
• On future outlook of capital market, according to Survey, there may be increase of reliance on public issues as a major source of funds for Indian corporates.

Economic Survey 2006-07: Complete Coverage