Two days before the presentation of the interim budget for 2024-25, the Finance Ministry today, i.e., January 29, said that India's GDP may be 7% next year. The ministry has released a report named 'The Indian Economy: A Review'. It has been prepared by officials of the office of Chief Economic Advisor V Ananth Nageswaran.
The report said that strong domestic demand has driven the economy to a growth rate of more than 7% in the last three years. Due to the steps taken by the government in the last 10 years, private consumption and investment have strengthened. Steps taken to boost manufacturing and investment in infrastructure have also strengthened the supply side.
The report also says that the economy may continue to grow at the rate of 7% in the coming years. Only the increased risk of geopolitical conflicts is a concern. Furthermore, India can become a $7 trillion economy by 2030. This will be an important milestone in the journey of providing quality of life and standard of living.
This report is different from the usual as it has come just two days before the start of the budget session of Parliament. Lok Sabha elections are to be held this year, so instead of the full budget, an interim budget will be presented on 1 February. The interim budget provides money to the current government to run the country until the new government comes in and the full budget is presented.
The government does not present the Economic Survey before the interim budget. The Finance Ministry said in its report, 'This is not the Economic Survey of India prepared by the Department of Economic Affairs. This will come before the full budget after the general elections.
GDP is used to track the health of the economy. GDP shows the value of all goods and services produced within a country in a specific time period. In this, the foreign companies which produce within the country's borders are also included.
There are two types of GDP. Real and nominal. In real GDP, the value of goods and services is calculated at the base year's value or stable price. Currently the base year for GDP calculation is 2011-12. That is, the calculation was done according to the rates of goods and services in 2011-12. Whereas nominal GDP is calculated at current price.
A formula is used to calculate GDP. GDP=C+G+I+NX, here C means private consumption, G means government spending, I means investment and NX means net export.