Prior to Modi Government 2.0's first Union Budget, CEA Krishnamurthy Subramanian on Friday has said that he hoped that the Economic Survey prepared by his team and tabled by Finance Minister Nirmala Sitharaman in the Rajya Sabha on Thursday would be reflected in the Union Budget. This is Subramanian's second budget, having been instrumental in the preparation of the interim budget in February 2019.
"I hope many of the ideas in the economic survey will find a space in the Union Budget. This is not my first budget. I have already been part of the interim budget. I anticipate the budget to be good," he said.
Earlier on Thursday, the Economic Survey suggested that to achieve the aim of becoming a $5 trillion economy, a GDP growth rate of 8% must be maintained. It states that to do so the focus must be on savings, investment supported by the private industry which is a 'key demographic" in creating jobs.
"Such growth can be sustained by a "virtuous cycle" of savings, investment and exports. Private investment is the "key driver" that drives demand, creates capacity, increases labour productivity - generates jobs. Capital investment fosters job creation as the production of goods, research & development and supply chains generate jobs," states the survey.
Differing the Anglo-Saxon growth model for India, the survey states that it views economic equilibrium differently adding that traditionally job creation, demand, exports and economic growth are tackled as different problems. Explaining how these macroeconomic issues can be tackled by the above mentioned 'virtuous cycle', the survey states:
"By presenting data as a public good, emphasizing legal reform, ensuring policy consistency and behaviour changes through behaviour economics, the Survey aims to enable a self-sustaining virtuous cycle," states the survey.
On Friday, Prime Minister Narendra Modi-led NDA government will present its second Budget for the 2019 calendar year and crucially, its first since being handed an enhanced mandate by the people of India in the 2019 Lok Sabha elections. This time around, Nirmala Sitharaman will be the one who will present it in the Lok Sabha, scripting history as the first woman to do so since former Prime Minister Indira Gandhi who had also then held the finance portfolio. Sitharaman's maiden budget speech in Parliament at 11 a.m. on Friday would entail the 89th Union budget, including interim ones that Independent India has seen. After Nirmala Sitharaman will present the Budget in the Lok Sabha, both lower and upper houses will be adjourned for the day.
One of the reasons this Budget, presented by Nirmala Sitharaman, is special because it is going to be the first ever Budget to be presented by a woman Finance Minister in 48 years since the then Prime Minister Indira Gandhi held the charge of the Finance Ministry. Alongside that, it is also the first budget of the Modi government 2.0 and unlike the 2014 Modi budget, the expectation is one of providing large-scale growth based on the work of the last five years as opposed to setting the economy upright from what had been handed over by the UPA.