Economic Survey - Suman Chowdhury, Chief Analytical Officer, Acuité Ratings & Research

"The Economic Survey highlights the government's priority to revive GDP growth in FY22 and further to sustain a growth of 6.5%-7.0% over the medium term. It has indicated that an expansionary fiscal policy may continue beyond the current year to boost domestic demand and investments. This may imply that the government may not be in a hurry to tighten up on the fiscal front in the near term and may be comfortable maintaining the fiscal deficit at a level significantly over the previous band of 3.0%-4.0%. Better quality of expenditure i.e. a higher share of capital expenditure along with some progress on reforms may augur well for fiscal stability over the medium term. While the survey report is optimistic about India's medium term growth prospects, it has also warned about potential systemic risks in the banking sector accruing from excessive forbearance beyond the pandemic period and has also recommended an Asset Quality Review after the economy reaches normalization."

Source : Equity Bulls

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