Economic Survey 2009-10: GDP Outlook Introduction: Year 2009-10 started as a difficult Year for Indian economy.

The Global Economic Slowdown had retarded the growth of our economy more prominently in the second half of 2008-09. This was a time when the Global Financial crisis was at its full swing and had spread its tentacles to all parts of the word. Base year: Here, a point has to be noted that with the release of the quick estimates of National Income for year 2008-09, the central statistical organization (CSO) and changed the base year of its NAS (National Accounts Statistics) from 1999-2000 to 2004-05. Growth Projects: 1. The overall growth of GDP at factor Cost at constant prices in 2008-09 as per revised estimates released by the Central statistical organization was 6.7 %. 2. The turnaround in the Indian economy came in the second quarter of 2009 when India s -10 economy grew by 7.9 %. 3. As per the advance estimates for GDP for 2009-10 released by the central statistical organization the economy is expected to grow at 7.2% in 2009-10. 4. Industry and service sectors are expected to grow by 8.2 & 8.7% respectively. 5. The manufacturing sector had shown a declining trend for last 8 quarters (since 2007-08), but now has got some momentum. 6. There was also a decline of agricultural output by 0.2 % in 2009-10 due to poor Monsoons. 7. The economic survey expected that economy is likely to grow by 8.75% in 2010-11 and return to 9% growth in 2010-12. Following chart shows the growth of GDP (at Factor Cost 2004-05 prices)

What is an Economic Survey? Economic survey is an annual commentary on the state of the economy of India which is put together by Finance Ministry of India. It is a document which presents economic development during the course of the year. The draft of the survey is prepared by Department of Economic Affairs and cleared by Chief economic Advisor and the secretary Economic Affairs. The final version is vetted by Finance secretary and Finance Minister. When an Economic Survey is presented? Economic survey is presented every year shortly before presenting the Union Budget of govt. of

India, or jus after the railway budget. Out of the 10 to 11 chapters presented, the first chapter which is titled State of the Economy and prospects deals in detail with overall macroeconomic performance of the country. Wh t is th obj ti of n ono i u An economic Survey provides an opportunity for the government of India to spell outits economic agenda. The govt. also represents its issues and priorities.


nd x of indust i l p odu tion ( ): The inde of Industrial production has shown a U shaped curve since the first quarter of 2007-08. It was 11.6 % is the end of 2006-07 which decreased steadily for 8 quarters to become 0.5% in fourth quarter of 2008-09. This indicated the impact of recession on Indian Industry. Since last 3 quarters its has shown upward trend and in October- o vember 2009, it reaches to 11.0 %, which indicated the recovery. The following graphic shows the trend: (clic for Clearer View)
    

Various Components of IIP has grown as follows: (clic for clearer view)


CSO s advanced estimated place industrial sector growth at 8.2% (against 3.9% in 2008-09) 1. The IIP Industrial Growth (Inde of Industrial Production) is estimated 7.7% for April November 2009-10. This is up from 0.6 % during the same quarter of 2008-09. ] 2. The manufacturing sector has grown by 8.9% in 2009-10.
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1. Strong growth: Automobiles, rubber, plastic products, wool, silk , te tiles, wood products, chemicals 2. Moderate growth: nonmetallic mineral products

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3. No Growth : Papr, leather, food and Jute. 4. Negative Growth: beverage and tobacco, Growth pattern on Use Basis 1. Strong growth : Consumer durables and intermediate goods 2. Moderate Growth : basic and capital goods 3. Negative Growth: Consumer non durables. Service Sector:
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Owing to a robust growth momentum of telecom service, the core industries and infrastructure services sector grew richly and the growth spread to power, coal, ports, cibvil aviation and roads.

Power:
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During April December 2009, the peak deficit came down by 12.6 % and total energy deficit came down by 9.8% as compared to 13.8% and 10.9% respectively. Thus the electricity generation has grown and over all PLF (Plant Load Factor) improved in 2009. This is partly attributed to availability of gas from the KG basin(D6) and surplus utilization of gas available on fallback basis.
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Crude Oil Domestic Supply :

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During 2009, the projected production for crude oil is 36.7mmt which is about 11 & higher than the actual cruide oil production of 33.5 mmt in 2008-09. (mmt=Million metric Tonnes) This is partly attributed to discovery of 15 new oil and gas discoveries.

Roads:
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The stipulated target of developing the national highways under various phases of the National Highways Development programme was 3165 kms. The achieved development till November 2009 is 1490 kms (only)

Telecom:
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In India there were 54.6 million telephone subscribers in 2003. By the end of March 2009, this figure was 429.7 million and grew robustly at 562 million by October 31, 2009. Thus there was a 96 million subscribers during the period from march to December 2009.

Service Sector:

Service sector has been India s flag bearer for more than a decade continues to maintain that growth. The service sector has grown 8.7 % in 2009-10 as compared to 9.8% in 2008-09. Other subsectors have also maintained the growth rate.

Pharmaceuticals:
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The Indian pharmaceutical industry has become the third largest in world in terms of volume and ranks 14th in terms of value at over Rs 1 lakh crore which humbly started from Rs. 1500 crore in 1980. Exports of pharmaceuticals have consistently outstripped imports. India exports drug, intermediaries, active pharmaceutical ingredients (APO), finished dosage formulations, biopharmaceuticals and clinical services. The top five destinations for such exports are the USA, Germany, Russia, the UK and China.

Notes on 3G Spectrum & BWA

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3G spectrum auction will open doors for foreign players in India. The upcoming auction of radio waves for the third generation mobile services will open the doors for foreign players to make an entry into fast growing Indian telecom market. Launch of 3G Technology will provide existing operators a good opportunity as also foreign players to make an entry into the Indian market and bring in new technology and innovation. There is no cap on the number of service providers in each circle. For the 3G telephony, the government is planning to allow three to four private players in each circle depending upon the spectrum availability. The auction of 3G and Broadband Wireless Access (BWA) spectrum scheduled to be held on April 9. The government had earlier indicated that interested foreign entities could take part in the auction directly. The Survey said that the introduction of BWA services will enhance the broadband penetration in the country. The broadband subscriber base was 7.98 million by the end of December 2009.