Chinmaya IAS Academy – Current Affairs Chinmaya IAS Academy – Current Affairs
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Finance Minister Nirmala Sitharaman on Wednesday clarified that the Economic Survey and the Union Budget project different rates of nominal GDP growth for 2019-20 because they use different base figures. However, she added that the two rates were consistent with each other. While the Union Budget presented on July 5 projected a nominal GDP growth of 12% for financial year 2019-20, the Economic Survey pegged this figure at 11%. Opposition leaders in the Lok Sabha highlighted this discrepancy and demanded why there were so many different numbers being issued by the government. The Opposition also walked out of the lower House during Ms. Sitharaman’s reply to the concerns over the Budget, protesting the Budget’s announcement of a hike in the duties and cess rates on petrol and diesel. Her explanation for the lower GDP base being used in the Budget was that this was the same number used in the Interim Budget presented in February. “A lower GDP base of 2018-19 has been used in the Budget document as the same GDP base was used in the interim Budget presented in February 2019,” Ms. Sitharaman said. “Using the same GDP base ensures comparability from Budget to Budget, interim Budget to regular Budget, and this Budget to last year’s Budget.” She said that using the same base ensures comparability of the deficit ratios used in the July Budget and the interim Budget.
