Economic Survey 2016-17 says there are several challenges that may impede India’s progress: They are: a) ambivalence about property rights and the private sector, b) deficiencies in State capacity, especially in delivering essential services and c) inefficient redistribution.
To overcome these challenges, the Economic Survey has advocated reforms in several sectors to unleash economic dynamism and social justice in the country. The Survey, which was tabled by Union Finance Minister Arun Jaitley in the Parliament today, says, “India needs an evolution in the underlying economic vision across the political spectrum and further reforms are not just a matter of overcoming vested interests that obstruct them.”
According to the Survey, there are difficulties in privatising public enterprises, even for firms where economists have made strong arguments that they belong in the private sector.
To address this, the Survey argues for the need further privatize the Civil Aviation, Banking and Fertilizer sectors.
According to the Survey, the “capacity of the State in delivering essential services such as health and education is weak due to low capacity, with high levels of corruption, clientelism, rules and red tape.
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“At the level of the states, competitive populism is more in evidence than competitive service delivery,” the Survey says, adding, “Constraints to policy making due to strict adherence to rules and abundant caution in bureaucratic decision-making favours status quo”.
The Survey also says that redistribution of resources by the government is far from “efficient” in targeting the poor. With respect to current programmes of the government, it says, “spending is likely to be greatest in states with better institutions and which will therefore have fewer poor.”
Earlier in the day, President Pranab Mukherjee inaugurated the Budget session of Parliament, while Prime Minister Narendra Modi expressed hope there would be good discussion over the budget by
political parties and which would be used for forwarding people-friendly development measures.
“Yet another new tradition comes into effect from today. Budget is being presented one month ahead and the rail Budget has now become a part of the Union Budget,” PM Modi told reporters ahead of the inauguration of Budget session.
“There will be extensive debate in the Parliament on this issue and it will also reflect the ensuing benefits from the decision in the days to come. I am optimistic that all political parties will join hands to ensure a healthy debate in the Parliament in the larger public interest,” he added.
In his address to the joint session of Parliament, President Mukherjee hailed Modi government’s development initiatives and its efforts to fight against corruption and black money.
Breaking from the past Budget practices, Modi government has advanced the dates of presentation of Economic Survey and the Union Budget by a month. Moreover, the practice of presenting a separate Railway Budget has also been done away with and merged with the Union Budget. While Economic Survey was tabled in the parliament today, the Union Budget would be tabled tomorrow.