Growth of the Indian Economy, Women-led Development, Carbon Border Adjustment Tax

The Survey’s six-pronged strategy focuses on-
Capital formation in the private sector grows organically and steadily.
Financing green transition for India is an area where public-private partnerships will be critical.
The Survey’s six-pronged strategy focuses on-
Capital formation in the private sector grows organically and steadily.
Financing green transition for India is an area where public-private partnerships will be critical.
RThe Survey’s six-pronged strategy focuses on-
Capital formation in the private sector grows organically and steadily.
Financing green transition for India is an area where public-private partnerships will be critical.
Removing credit gaps for MSMEs.
Tapping the potential of agriculture with intelligent, farmer-friendly policies.
India’s education policies and skill policies should adopt a laser-like focus on learning and skilling outcomes.
To enhance state capacity and capability, state machinery needs to reinvent and reinvigorate.

The Indian economy has broadly caught up with pre-COVID growth trends, avoiding permanent scarring, and is expected to grow by 6.5% to 7% this year, according to the Economic Survey for 2023-24.

The Survey highlights the need to address inequality and unemployment as policy priorities.
Chief Economic Adviser (CEA) V. Anantha Nageswaran urged the Union and State governments to relinquish regulatory powers to ease the burden on businesses and called on the corporate sector, which is currently experiencing high profits, to generate productive jobs in its own “enlightened self-interest.”
Noting a significant slowdown in IT sector hiring over the past two years, the survey emphasised that the Indian industry should consider how AI can augment labour rather than displace workers.
The Survey noted that corporations benefit from the higher demand generated by employment and income growth, while the financial sector benefits from channelling household savings for investment purposes. However, warned that “short-termism” could weaken these linkages.
It also pointed out the negative impact of social media, screen time, sedentary habits, and unhealthy food on public health and productivity, criticizing the private sector’s contribution to these issues.
India’s per capita income GDP has risen seven times since 1990 to $2,500, but achieving $10,000 by 2047 requires a different approach.

Dig Deeper: What is short-termism in the financial sector?

Women-led Development

The Chief Economic Adviser in the Economic Survey observed that India is transitioning from women’s development to women-led development.

A 218.8% increase in budgetary allocation for women’s welfare and empowerment schemes, acknowledging the “motherhood penalty” that leads to a drop in female labour force participation around childbearing years.
It highlighted that the share of the Gender Budget in the total Union Budget increased to 6.5% in the financial year 2025, the highest since the Gender Budgeting Scheme was introduced in 2006.

Care Economy
• Addressing the care economy, the Survey estimated that public investment equivalent to 2% of GDP could generate 11 million jobs in the sector, with nearly 70% going to women.
• It referenced care economy models from Australia, Argentina, Brazil, and the U.S.
• According to the International Labour Organisation (2018), the care sector is one of the fastest-growing sectors globally, with investments expected to generate 475 million jobs by 2030.

Factsheet
• The Pradhan Mantri Kaushal Vikas Yojana (PMKVY) saw an increase in women’s participation from 42.7% in 2015-16 to 52.3% in 2023-24.
• Under the Jan Shikshan Sansthan (JSS) scheme, women constituted about 82% of beneficiaries.
• In ITIs and National Skill Training Institutes, women’s participation rose from 9.8% to 13.3%.
• The Survey noted a rise in the female labour force participation rate (LFPR) from 23.3% in 2017-18 to 37% in 2022-23, driven by rural India.
• The Pradhan Mantri Jan Dhan Yojana facilitated the opening of 52.3 crore bank accounts, with 55.6% held by women as of May 2024.

Dig Deeper: Read about the Female Labour Force Participation Ratio. Which organisation publishes it?

Care Economy, Development, Employment, Government Policies, Inclusive Growth, Welfare Schemes for Social sector

Mental Health and Individual, National Development

Mental Health Factsheet
• According to the National Mental Health Survey (NMHS) 2015-16, 10.6% of adults in India suffer from mental disorders, with a treatment gap ranging from 70% to 92% for different disorders.
• Mental morbidity is higher in urban metropolitan regions (13.5%) compared to rural areas (6.9%) and urban non-metro areas (4.3%).
• NCERT found an increasing prevalence of poor mental health among adolescents, exacerbated by the COVID-19 pandemic.
• It found 11% of students reported feeling anxious, 14% extreme emotions, and 43% mood swings.

The Economic Survey acknowledges mental health as a crucial driver of individual and national development, highlighting its significance and policy implications for the first time.
It notes that mental health disorders lead to significant productivity losses due to absenteeism, decreased productivity, disability, and increased healthcare costs.
Poverty exacerbates mental health risks due to stressful living conditions, financial instability, and lack of upward mobility, contributing to psychological distress.
Key government initiatives include-
National Mental Health Programme
National Tele Mental Health Programme
Increasing the number of mental health personnel
Rashtriya Kishor Swasthya Karyakram’s adolescent-friendly health clinics and peer education programs.
Efforts aim to raise the number of psychiatrists from 0.75 per lakh population in 2021 to the World Health Organization norm of three per lakh population.

Dig Deeper: Read about Tele- Manas scheme and its effectiveness.

Children, Government Policy, Health, Inclusive Growth, Issues related to Poverty, Mental Health

Carbon Border Adjustment Tax

CBAM
• The CBAM is expected to come into force on January 1, 2026.
• According to the Global Trade Research Initiative, India will be among the top eight countries adversely affected by CBAM.
• In 2022, 27% of India’s exports of iron, steel, and aluminium products, worth $8.2 billion, went to the EU.
• Core sectors like steel are expected to be greatly impacted by CBAM.

Economic Survey echoed concerns of Protectionism and noted that the European Union’s forthcoming Carbon Border Adjustment Tax (CBAT) contradicts the spirit of the Paris Agreement.
The Carbon Border Adjustment Mechanism (CBAM) imposes tariffs on energy-intensive goods imported into the EU to prevent local manufacturers of iron, steel, and aluminium from being disadvantaged compared to goods produced in developing countries with more permissive fossil fuel emission norms.
India faces the dual challenge of addressing climate change and dealing with the protectionism of developed countries.
Europe is set to implement its Carbon Border Adjustment Tax, with the UK and the US also planning their versions.
These taxes violate the Paris Agreement’s principle of “Common but Differentiated Responsibilities.”

Dig Deeper: Read about the EU’s other Sanitary and Phyto-sanitary measures.

Carbon Tax, Conservation, Developing World, Environment Pollution, International organisations, Protectionism, Trade Policies

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Growth of the Indian Economy, Women-led Development, Carbon Border Adjustment Tax

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