Economic Survey 2002-03 released today as rightly presented a very realistic outlook of the economy for the year 2002-03 as compared to the mid year review which was full of shocks and presented a very pessimistic view feels Dr. J.D. Agarwal, Chairman , Indian Institute of Finance. Economic survey as clearly outlined the achievements of India's economy during the year 2002-03 and gives an assurance to all those who have had apprehensions about the performance of India's economy , feels Dr. Agarwal.

According to Professor Agarwal the growth rate of 5.6 per cent or 2001-02 forex reserves for 17 million dollar, Rupee gaining strength by 2 per cent, easy liquidity / cash reserve ratio dropping below 5 per cent, BOP record surplus an increase in exports of Automobiles, Software, Gems and Jewellery are positive features of the survey. The infrastructure development particularly construction of 10,000 rural roads addition of 24 million tone refining capacity and covering tense data fully by rural electrification and Telecom sector growth rate being up to 17 per cent will make India march forward at a faster rate, according Dr. Agarwal.

Although a consolidated fiscal deficit of 10 per cent of GDP and Centre fiscal deficit proportion of GDP estimated 5.9 per cent in 2001-02, may be considered to be high and a cause of concern yet for a developing country like India where a large investment is to be made in building up infrastructure and the capacity of the economy and in the current economic scenario of low inflation of 3 % and high savings rate of 24 % and BOP surplus it should not cause worries, according to Dr. Agarwal. However, what is of serious concerns is the increase in the share of consumption expenditure in total center expenditure to more than 23 percent in 2002-03. While the government and the Finance Minister have been seized with this problem and made announcement in the last budget about the controlling centre government expenditure yet it has gone up, according to Dr. Agarwal. There are large areas of wasteful expenditure in which effective step should have been taken so as to reduce the fiscal deficit both of the Center and the State Government, according to Dr. Agarwal.

There was an urgent need during the year to control food, fertilizer and petroleum subsidies particularly after dismantling APM in the petroleum sector and food.

Dr. Agarwal strongly feels that the government should have taken effective steps not to allow shortage for capital receipts. According to Dr. Agarwal there was no justification for higher budgetary support to UTI to benefit few million subscribers of US 64 at the cost of rest of the country, which includes 26 per cent people living below the poverty line.

Dr. Agarwal appreciated Economic Survey stating that the 10th Five Year Plan annual average growth rate fixed at 8% is realistic in contrast to what was stated in mid year review. Dr. Agarwal has also welcomed the issues and performance outlined in the economic survey and the government's intention to take necessary steps in that direction.