The Budget session of Parliament started today with PM Narendra Modi hoping that the Opposition sets aside differences and allows the Parliament to function in the interest of the nation. Thereafter, President Pranab Mukherjee addressed the joint session of Parliament and highlighted the achievements of the NDA government. Closely in its wake was followed by the tabling of the Economic Survey 2017. Chief Economic Advisor Arvind Subramanian addressed the media after tabling of Economic Survey, here are few key takeaways:
1. The document aims to provide objective analysis. The past year has had robust macroeconomic stability
2. Universal Basic Income a radical new idea; an idea whose time is right for deliberation, not necessarily for immediate implementation
3. Bank credit affected by demonetisation, seems like it has come down. The overall picture is mixed
4. Not appropriate to do a before-after analysis of GDP growth, with respect to demonetisation
5. Demonetisation has short term costs, potential long term benefits
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6. External challenges include rise in oil prices and protectionism
7. Balance sheet of banks and private sector still challenged; much of debt is in large companies
8. Not appropriate to do a before-after analysis of GDP growth with respect to demonetisation
9. One of the aims of demonetisation was bringing down real estate prices
10. Demonetisation has actually affected different forms of money very differently. What demonetisation has done is both simultaneously reduced supply of cash, but by the same token it has increased supply of deposits. Currency squeeze was less severe than perceived. Full remonetisation expected in a month or two