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MobileApp(https://goo.gl/aklyu8)|IAS2016ONLINECOACHING(http://iasexamportal.com/civilservices/courses/ias
pre/csatpaper1)|UPSCPAPERS(http://www.iasexamportal.com/civilservices/iaspre/papers)|

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SignificanceforUPSCaspirants:GSPaperIIIwithoutEconomicsurveywillbealwaysincomplete.Itcoversthe
majorsectionofpaperIIIfromtheeconomytothedevelopmentsandagriculture,PDSetc.
TwoBroadthemes:creatingopportunityandreducingvulnerability.

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ProjectedGDPgrowthrateof8.18.5%for201516against7.4%in201415.
Inflationdeclinedbyover6%points
CAD(currentaccountdeficit)dropfrom6.7%to1%ofGDP.
Fiscaldeficit(FD)targetof4.1%andalsotoachieve3%ofGDP.
Stabilisedrupeebecauseofforeignportfolioflows.
Expenditurereformfromconsumption(reducingsubsidies)toinvestment.Currently4.24%oftheGDPon
subsidies.(JAMTrinity:JDY+Aadhaar+Mobile

fortargeted&lessdistorteddelivery)

FFCStateswillhave42%fromthroughtaxdevolutionand65%aggregates(tax+grants)
4Dsolutionforpolicyconstrainedbankingindustry:Deregulation,differentiation,diversification,
disinterring.

DeregulationbyaddressingSLRandPSL,differentiationwithinPSBsinrelationtorecapitalization,
shrinkingbalancesheets&ownership),diversification(sourceoffundingwithinandoutsidebanking)
anddisinterring(improvingexitmechanisms)

Addressingkeyproblems:rampingupinvestment,rationalizingsubsidies,creatingacompetitive,
predictable,andcleantaxpolicyenvironment,andacceleratingdisinvestment.
Equitysurge(SensexandNifty):10yeargovernmentsecurities,andcontributedtothesurgeinequity
prices(31%sinceApr2014)
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RBIacttoamendtosetupamonetarypolicycommittee.
Domesticblackmoney:anewbenamitransactionbilltobeintroduced

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Its a flagship annual document presented by Finance Ministry every year just before the Union budget. It
reviewstheIndianeconomybylookingatEconomicOutlook,Prospects,andPolicyChallenges.Italsoprovides
the short and medium and short term prospect of the economy. Survey presented to both the house of
parliamentduringBudgetSession,generallyduringFebmonthofeachyear.

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InspiredbytheIMFsWorldEconomicOutlook,thisyeareconomicsurveypresentedintwovolumeswith
total of 19 chapters covering the issues from main economic framework to various sectors of economy like
agriculture,industry,servicestoclimatechangeandsustainabilityandhumanresources.Exclusivecoveragefor
theMakeinIndia,IndiasGreenAction,andFourteenthFinanceCommission(FFC),makeitmoreimportantfor
anUPSCaspiranttouseitforenrichingtheanswersduringmainsexamination.
Primarily,Volume1discussestheoutlookandprospectsandVolume2describesrecentdevelopments
inallthemajorsectorsoftheeconomy.Conclusively,Volume1isforwardlookingwithperspectivesfromrecent
pastwhichisthesubjectofVolume2.
Snapshot: Urging for fiscal consolidation by bringing down the FD (fiscal deficit), Expenditure rationalisation,
enhancedrevenuegenerationtopropeltheeconomy
With fundamental objective of wiping every tear from every eye, India has reached a sweet spot to
launch doubledigit mediumterm growth trajectory. More stable macroeconomy, various reforms with strong
political mandate, recovering economy, favourable external environment and challenges in other economy has
madeIndiaacomfortabledestinationforinvestors.
For wiping tears wellfunctioning, welltargeted, leakageproof safety net which will both provide (minimum
income)andprotect(againstadverseshocks).Inthisregardtheintentionofhowbesttoprovideandprotect,
andtechnologybaseddirectbenefittransferswillplayanimportantrole.
Longrungrowthdeterminedbyperspirationandinspiration,investmentandefficiency,respectively.Forlong
runprivateinvestmentmustremainthemainengine.ButthecloudyenvironmentofIndianprivateinvestment
remainedsluggishinlastdecade.Variousfactorsplayedtheroleofholdingbacktheinvestment,namely,weak
corporate balance sheets, an impaired banking system, difficulty of exit, the deficiencies of the PPP model in
infrastructure.
Forshorttomediumtermpublicinvestment,especiallybytherailways,willhavetoplayacatalyticrole.
MakeinIndiainitiativeistryingtoachievethemanufacturingandtradebasedenginesofgrowth,as
happenedinthepostwarperiodformosteconomies,especiallyinAsia.
Theobjectiveofprotectingthevulnerablemusttakethenoteofclimatechange,genderequalityforbetter
growth,developmentandequalityofopportunity.
Centrestate fiscal relations have dramatically reshaped by acceptance of recommendations of the
FourteenthFinanceCommission(FFC).With42%taxdevolutiontostatefromthedivisiblepoolofCentresNet
Taxes,statesaggregateshare(taxesplusgrants)ofthedivisiblepoolataround65%.Nowthefunding
willnolongerbeschemeandgrantbased,itwouldratherbedevolutionbasedandwiththatstateshavegotthe
morespendingfreedom.
FFChasalsorecommendedthatthecentraltransferstostatesmustbeatleast49%ofgrosscentralrevenue
receipts during 201520. Another larger recommendation is to revitalise and strengthen another constitutional
body,theInterStateCouncil,forprovidingaforumfordiscussionaswellasdecisionmakingtoestablishthe
newcooperativefederalism.
Withallthese,EconomicSurveyisNotableforthreereasonssenseofoptimism,fiscaldiscipline,Subsidy
management.
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ClickHeretoreadRailwayBudget2015AnalysisforCivilServicesAspirants
(http://iasexamportal.com/civilservices/railwaybudget2015analysisforcivilservicesaspirants)

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