India to present economic survey Thursday

Wednesday, 26 February 2003, 08:00 Hrs
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NEW DELHI: The Indian government will present in Parliament the much awaited economic survey on Thursday.

In a statement issued late Tuesday, the government said the economic survey would be tabled in both houses of Parliament only on Thursday and not on Wednesday as had earlier been stated.

While Railway Minister Nitish Kumar will present his budget for 2003-04, Finance Minister Jaswant Singh will table the economic survey that takes into account the challenges and opportunities ahead.

The railway budget and the economic survey would be followed by the federal financial budget for the next fiscal year Friday.

The largest employer in the organised sector with some 1.5 million employees, the railways is projected to end the fiscal with an uncovered deficit of about 10 billion.

Analysts say the main issue of the railway budget will be whether or not the government decides to go for further hikes in passenger fares, as the world's second largest rail network is battling revenue losses and safety concerns.

The political fallout of a steep hike in passenger fare to shore up resources has often acted as a deterrent to the railways.

Indian Railways is also under pressure to improve its infrastructure and safety record while continuing to meet its social role of providing affordable travel to people with low incomes.

Of the around 13,000 trains the Indian Railways operates daily, about 8,000 are passenger trains carrying around 13.3 million people every day. About 50 percent of these trains are suburban trains offering subsidised travel.

The Economic Survey for 2003-04 is likely to retain the gross domestic product (GDP) growth target at between 5 and 5.5 percent in the current fiscal year.

Brushing aside fears of a prolonged economic slowdown caused by a severe drought, the government in its mid-year review of the economy unveiled in December expressed confidence of retaining the growth in the current fiscal ending in March.

The government said prospects for the year appear "brighter" than the initially subdued estimates.

The government's review of the economy had been expected to lower the economic growth forecast for the year ending March 2003, as the worst drought to hit India in three decades severely dent agricultural output.

Agriculture is crucial to the country's economy as it accounts for about a quarter of the GDP.

Rainfall in the country was 24 percent lower than normal in the annual monsoon season. Even though the monsoon revived towards the end of the season, the country continues to feel the impact of the drought.

India's economic growth for 2002-03 is estimated at 4.4 percent, down from 5.6 in previous fiscal year, as a severe drought in some parts of the country dented agricultural output.

The government is also likely to reiterate its commitment to the economic reforms drive in the economic survey.

India's ambitious privatisation drive, projected as the cornerstone of the reforms programme, has repeatedly come under attack in recent months, with the ruling coalition's allies demanding a review of the divestment agenda.

New Delhi plans to raise 120 billion from the sale of shares in state-owned firms in the current financial year. It has repeatedly failed to meet targets in the past because of stiff protests from opposition parties and trade unions.

The survey is also expected to highlight the importance of speeding up foreign investment in the country to achieve higher growth.

India has set an annual target of attracting $10 billion in foreign direct investment but has managed only to get only $3-$4 billion each year.
Source: IANS
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