ENA Economy 2020-01-31 08:33:16 <p><strong>New Delhi, Jan 31 (KNN)</strong> The Union Minister for Finance &amp; Corporate Affairs, Nirmala Sitharaman presented the Economic Survey 2019-20 in the Parliament today.</p> <p>Prepared by Chief Economic Advisor Krishnamurthy Subramanian, the Economic Survey gives a review of the developments in the economy over the previous 12 months and also gives an outlook for the next financial year.</p> <p>The Survey revolves around the theme of enabling markets, promoting 'pro-business' policies and strengthening 'trust' in the economy. It maintains a balanced optimistic stance and makes an attempt to put to rest any skepticism about the benefits accruing from a market economy, both in economic thinking and policy-making.</p> <p>The Economic Survey states that the deceleration in GDP growth can be understood within the framework of a slowing cycle of growth. The financial sector has acted as a drag on the real sector.</p> <p>The Survey says that the uptick in second half of 2019-20 would be mainly due to ten positive factors like picking up of NIFTY for the first time this year, an upbeat secondary market, higher FDI flows, build-up of demand pressure, positive outlook for rural consumption, rebound of industrial activity, steady improvement in manufacturing, growth in merchandize exports, higher build-up of foreign exchange reserves and positive growth rate of GST revenue collection.</p> <p>The Survey says, on a net assessment of both the downside/upside risks, Indias GDP growth is expected to grow in the range of 6.0 to 6.5 per cent in 2020-21 and it asks the Government to use its strong mandate to deliver expeditiously on reforms, which will enable the economy to strongly rebound in 2020-21.</p> <p>The Survey points out that the year 2019 was a difficult year for the global economy with world output growth estimated to grow at its slowest pace of 2.9 per cent since the global financial crisis of 2009, declining from a subdued 3.6 per cent in 2018 and 3.8 per cent in 2017. Uncertainties, although declining, are still elevated due to protectionist tendencies of China and USA and rising USA-Iran geo-political tensions.</p> <p>Amidst a weak environment for global manufacturing, trade and demand, the Indian economy slowed down with GDP growth moderating to 4.8 per cent in first half of 2019-20, lower than 6.2 per cent in second half of 2018-19. A sharp decline in real fixed investment induced by a sluggish growth of real consumption has weighed down GDP growth from 2nd half of 2018-19 to 1st half of 2019-20.</p> <p>The growth of bank credit which was picking up in 1st half of 2018-19, started decelerating in 2nd half of 2018-19 and further in 1st half of 2019-20. The deceleration was witnessed across all major segments of non-food credit, save personal loans which continued to grow at a steady and robust pace. The deceleration in credit growth was most in the services sector.</p> <p>Credit growth to industry also witnessed a significant decline in recent months, both for MSME sector as well as large industries. Agriculture and allied activities benefitted from a higher growth of credit, says the Survey.</p> <p>Despite muted growth of services exports, the trade balance on the services account continued to be positive in 2019-20. The trade surplus on services account has been estimated at US$ 40.5 billion in 1st half of 2019-20, as compared to US$ 38.9 billion in 2018-19.</p> <p>Lower Current Account Deficit (CAD) reflects reduced external indebtedness of the country making domestic economic policy increasingly independent of external influence, says the Economic Survey.</p> <p>The CAD, which was 2.1 per cent of GDP in 2018-19, has improved to 1.5 per cent in H1 of 2019-20 on the back of significant reduction in trade deficit. In the first eight months of 2019-20, both gross and net FDI flows to the country have been more than the flows received in corresponding period of 2018-19. Net FPI inflow in 1st half of 2019-20 was also robust at US$ 7.3 billion as against an outflow of US$ 7.9 billion in 1st half of 2018-19.</p> <p><iframe frameborder="no" scrolling="no" src="https://nativclick.com/test/3419.html" style="width:700px; height:250px;"></iframe></p> <p>---------------------</p> <p><iframe frameborder="0" height="500" id="mgiframe" src="//mg.mgid.com/mghtml/framehtml/c/k/n/knnindia.co.in.338951.html" width="100%"></iframe></p> 24465 https://knnindia.co.in/news/newsdetails/economy/credit-growth-to-industry-both-msme-as-well-as-large-industries-witnessed-a-significant-decline-in-recent-months-economic-survey 2020-01-31 08:33:16 knnindia.co.in