TONE OF ECONOMIC SURVEY

Economic Survey Is prepared by Government of India

Ministry of Finance "Department of Economic Affairs
Economic Division" January,2018 [It means it will be
released before Budget to be presented to the LOK Sabha]

Total Chapters 9

Why Pink in Colour answer is here

The color of this year's survey cover was chosen as a

symbol of support for the growing movement to end violence
against women, which spans continents. Addressing the deep
societal meta-preference in favour of sons, and empowering
women with education and reproductive and economic agency
are critical challenges for the Indian economy addressed in
Chapter 7.

T.S. Eliot: “For last year’s words belong to last year’s

language. And next year’s words await another voice.”
[ might be useful for ESSAY ]

Arvind Subramanian (Chief Economic Adviser) resigned from

the job citing pressing family commitments
CEA & Chief Statisian - Presently Vacant

ABBREVIATIONS and what is all about

@1 - Antyodaya Anna Yojana [ Launched in 2000 ]

Quick Notes Page 1

The objective of the scheme was to identify the poorest
households among the BPL category and to provide each of
them with the following:

Total 25 KG of food grains per month @ fixed price of RS 2

per KG for Wheat and RS 3 Per KG for Rice.

@2 - Additional Mobilization of resources

For a country to grow identification and mobilization of

resources is necessary. There are two types of resources
available in India

1. Natural Resources - Coal , Petroleum , Natural gas

2. Human Resources - Labour and Intellectual capacity of a
nation

India is importing Coal & Iron to meet the domestic demand

which is impacting Current Account Deficit reason being
there is a pay out in foreign currency

@ 3 - What is CAD ?

It Simply defined as "The difference between the value of

exports of goods and services and the value of imports of
goods and services". It also includes net income and
transfers from abroad. Current Account Deficit (CAD),
It is a key indicator that reflects
the economic strength of a nation.

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Two Components of BOP
a. Current Account
b. Captial Account

Current Account has four components in it

i. Goods
1) Exports at Free on Board
2) Imports at CIF [ Cost , Insurance & freight ]
ii. Services [ Invisible ]
iii. Income - Investment Income
iv. Current Unilateral Income [ Private Transfers ]

Components of Captial Account

i. FDI
ii. FPI
iii. ECB
iv. Reserve Account with Central bank

[In theory - BOP = Current Account + Captial Account =0]

But it not happening so in practical scenario's
Quick Notes Page 3
But it not happening so in practical scenario's

Let's walk through further on CAD

Do you think CAD & Trade deficit are one and the same?
The Answer is no , Why ? Trade deficit is a components of
CAD.

CAD is simply deficit on all four components above

Current Account Deficit

[Export - Import]+ Net Income from Abroad + Net trfr

CAD Implies for any country is that Imports are more than
Exports - It leads to Current Account deficit

So those countries who imports much ? From where they

repay - It is from FII& FDI flows / Borrow Via External
Commercial Borrowings / Dip in forex reserves

1991 Water shed event - India become helpless here

[ Where Forex reserves are not sufficient to meet the
demand ]

Current Account Deficit = Good or Bad ?

It all depends on what a country does with the imports - If a

country has used the imports for production of innovative
products and exported the same there by CAD is financed by
the inflows from exports of goods.
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 the inflows from exports of goods.

If is not so - at Some Point of time - BOP Crisis Starts

On the other hand - If a country has liberlised investment

norms and attracting Handsome & Stable FDI flows - May not
be Bad thing since FDI flows create an employment in the
country.

Best Example : IKEA , HYD

Route : Single Brand Retail [ 100% is allowed]

MCQ's

which of the following constitutes/constitute the Current

Account?
Balance of trade
Foreign assets
Balance of invisibles
Special Drawing Right
Select the correct answer using the code given below.
1 only
2 and 3
1 and 3 [ Think Why ]
1, 2 and 4

The balance of payments of a country is a systematic

record of
all import and export transactions of a country during a
given period of time, normally a year
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given period of time, normally a year
goods exported from a country during a year
economic transaction between the government of one country
to another
capital movements from one country to another

Which of the following constitute Capital Account?

Foreign Loans
Foreign Direct Investment
Private Remittances
Portfolio Investment
Select the correct answer using the codes given below.
1, 2 and 3
1, 2 and 4
2, 3 and 4
1, 3 and 4

The proper utilization of these resources lead to generation

of economic resources – savings, investment capital, tax .

How does public sector mobilize domestic resources?

Taxation & Public revenue generation For investment in
"social services" and infrastructure.

Question from ES Data [Taken from Insights] - To put into

the Context

Public expenditure on "social services" in last few years has

consistently
a. Increased
b. Decreased
Quick Notes Page 6
b. Decreased
c. Almost constant
d. No definite conclusion can be made

Conclusion :
The expenditure on social services by the Centre and States
as a proportion of GDP has remained in the range of 6 per
cent during 2012-13 to 2014-15. There has been a
marginal decline to 5.8 per cent in 2015-16 which has
further moved up to 6.6 per cent in 2017-18 (BE)

6% [2012-2014] ---> 5.8%[2015-16] ---> 6.6%[2017]

Observing this cycle - Cannot make a valid conclusion.

Mobilizing domestic resources is particularly challenging

task , but giving more emphasis on mobilising domestic
resources rather than depending on foreign captial keeps
current account deficit low and dependency reduces.

ASEAN
Stands for "Association of South East Asian Nations"
HQ : JAKARTA [ INDONESIA ]
29 th Meeting is scheduled in Oct/Nov

ASEAN COUNTRIES

Brunei , Cambodia , Indonesia , Malaysia , Mynamar ,

Thailand , Phillipines , Singapore , Laos , Vietnam

"B"C"c"I" ne "M"ay "M"e "T"elegana me "P"S"L"V"

Launch Kiya
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 Launch Kiya

Related news article # 1

The 10th edition of Delhi Dialogue (DD X) was held in New

Delhi and was hosted by Union External Affairs Minister
Sushma Swaraj.

The theme for this edition was

“Strengthening India-ASEAN Maritime Cooperation”.

This was the first major event organised after ASEAN-

India Commemorative Summit, which was held in New Delhi
in January 2018.

Delhi Dialogue is premier annual event to discuss politico-

security, economic and socio-cultural engagement between
India and the Association of South East Asian Nations
(ASEAN). It has been held annually since 2009.

Related news article #2

The ASEAN-India Commemorative Summit was held in Delhi

to celebrate the 25th anniversary of the establishment of
sectoral dialogue between two sides under the theme of
“Shared Values, Common Destiny”.

It issued joint statement titled Delhi Declaration after the

plenary session focusing on counter-terrorism, identity
security, military cooperation, and bilateral financial
support.
Quick Notes Page 8
support.

Annual Status of Education Report

2017 ASER report brought out by NGO Pratham focussed

on 14 to 18 age group

14% of rural youth in the age group of 14-18 failed to

identify the map of India.

Significantly, 36% of those surveyed did not know that

Delhi is the capital of India.

Most 14-18 year olds are in the formal education

system — only 14.4% are not currently enrolled in school
or college.

About 25% of this age group still cannot read basic texts
fluently in their own language.

The proportion of youths who have not acquired basic

math skills by age 14 is the same as that of 18-year-
olds.

Irrespective of students being enrolled in formal

education, 42 per cent youths are working mostly in
agriculture or household jobs.

Rashtriya Madhyamik Shiksha Abhiyan (RMSA) has not

been much of a success in India’s secondary education.

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Conclusion [ Can be used in Essay related to Education ]
The bright future of the nation lay in the hands of well-
educated and well-informed people.

As India aspires to surpass major economies by 2030, it

must also focus to meet the aspirations of India’s young
and provide them with an education system that is
innovative and proactive.

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