1 or 2 states may roll out universal income in two years: CEA

Chief Economic Advisor (CEA) Arvind Subramanian today expressed hope that at least one or two states will implement the idea of universal basic income (UBI) in the next two years.
Subramanian in the Economic Survey 2016-17 had mooted the idea of universal basic income or a uniform stipend paid to every adult and child, poor or rich.

"I can bet ... Within the next two years, at least one or two states will implement UBI," Subramanian told reporters here.

Universal basic income (UBI) will guarantee all citizens enough income to cover their basic needs and would be easier to administer than the current anti-poverty schemes, which are plagued by waste, corruption and abuse.

Here are the highlights of the Economic Survey:

GROWTH

• 2018/19 Growth seen at 7 pct to 7.5 pct y/y
• 2017/18 GDP growth seen at 6.75 pct y/y
• 2017/18 industry growth seen at 4.4 pct
• 2017/18 farm sector growth seen at 2.1 pct
• Economic management will be challenging in the coming year
• Biggest source of upside to growth to be from exports
• Cyclical conditions may lead to lower tax and non-tax revenues in 2017/18
• Private investment poised to rebound

FISCAL DEFICIT

• Target for fiscal consolidation specially in a pre-election year can carry a high risk of credibility
• Marked efforts will be required to meet budgeted revenue and fiscal deficit targets for full year
• Current account deficit for 2017/18 expected to average 1.5-2 pct of GDP
• Pause in general govt fiscal consolidation cannot be ruled out in 2017/18
• Suggests modest (fiscal) consolidation that signals a return to the path of gradual but steady deficit reductions
• About 400 bln rupees worth of additional borrowing does not affect underlying deficit - economic adviser

INFLATION, POLICY RATES

• Persistently high oil prices remain a key risk, to affect inflation, current account, fiscal position and growth
• If inflation doesn`t deviate from current levels policy rates can be expected to remain stable
• Average CPI inflation seen at 3.7 pct in 2017/18

AGRICULTURE

• Warns climate change could trim agricultural incomes in India by 15 percent to 25 percent with unirrigated lands being harder hit by rising temperatures and declines in rainfall

(with agency inputs)