Economic Survey 2013 highlights: 'Downturn more or less over', now 'cut subsidies'

"The situation warranted urgent steps to reduce government spending so as to contain inflation. Also required were steps to facilitate corporate and infrastructure investment so as to ease supply.

"Several measures announced in recent months are aimed at restoring the fiscal health of the government and shrinking the CAD as also improving the growth rate. With the global economy also likely to recover somewhat in 2013, these measures should help in improving the Indian economy's outlook for 2013-14," it said.

The economy is projected to grow at 5 per cent in current fiscal, the lowest in a decade. It was 6.2 per cent in 2011-12 and 9.3 per cent a year ago.

The projections of 6.1 to 6.7 per cent growth next fiscal takes into account normal monsoon, moderation in inflation rate and mild recovery in global growth.

"While India's recent slowdown is partly rooted in external causes, domestic causes are also important," it said, adding boost to consumption coupled with supply side constraints led to higher inflation.

It said the growth story is unlikely to get support from the global economic developments and would remain tied to movement in international oil prices.

Chief Economic Advisor Raghuram G Rajan in his introduction to the Survey said: "These are difficult times, but India has navigated such times before, and with good policies it will come through stronger."

Rajan prescribed shifting national spending from consumption to investment, removing the bottlenecks to investment, growth and job creation, besides making efforts to reduce cost

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