The Economic Survey of 2016-17 summarised its desiderata in the following words: “It (Economic Survey) must possess a rare combination of gifts …. No part of man’s nature or his institutions must be entirely outside its regard. It must be purposeful and disinterested in a simultaneous mood, its authors as aloof and incorruptible as artists, yet sometimes as near to earth as politicians.” Economic Survey 2016-17 went on to note that such was the popularity of the previous year’s Survey that it had been pirated and was being sold on Amazon. Publication of the Annual Economic Survey a day before the Union Budget is a much awaited event.

Offering rare insights in the Government’s economic thinking and giving a snapshot of the Indian Economy, together with a SWOT analysis, every word of the Economic Survey is precious to serious students of economics. The spirit and thinking behind the Budget can be perfectly understood by perusing the Economic Survey, because both documents are drafted by the same set of economists. Painstaking research, unbiased statistics and unmatched scholarship ensure that the Economic Survey remains of interest long after the corresponding year’s Budget is forgotten. However, Economic Survey 2022 and Economic Survey 2023 which ignored hard realities and stretched facts and logic to justify Government policies ~ were significant exceptions.

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This deleterious trend was reversed in 2024 and the current Survey carries forward the change; in sights and scholarship are back, the Survey is topical and does not shy away from discussing current problems, e.g., worrying levels of inflation and unemployment, slow uptick in manufacturing and exports etc. Most of the topics dealt with by the current Economic Survey remain identical to earlier Surveys. The first chapter examines the state of the Indian economy, and subsequent chapters analyse India’s medium-term economic outlook, fiscal policy trajectory and so on.

However, treatment of most topics is somewhat short on original thinking, and sometimes long on verbiage. While some of the earlier Surveys will be long-remembered for their insights like the Twin Balance Sheet Problem in Economic Survey 2015-16, or the highly original Eight Interesting Facts About India in Economic Survey 2016-17, or Tracking Development through Satellite Images and Cartography in Economic Survey 2021- 22, the current Economic Survey does not display acuity of such high order. The unduly optimistic tone of Economic Survey 2025-26 jars at times.

Facts not conforming to the authors’ narrative are sometimes not mentioned at all, or deliberately obfuscated, an example being the chapter on India’s social sector (Chapter 11), that does not bifurcate social sector expenditure between the Centre and States (this appears part of a deliberate strategy ~ there was no bi furcation in Economic Survey 2024-25 also), which would have revealed that the Centre’s spending on health and education was declining in percentage terms and schemes such as Samgara Shiksha and PM POSHAN (education), NHM (hea l th), MGNREGS (employment), NSAP (social security), PMGSY (rural development) and SBM-G (direct entitlement) saw a big decrease in budget allocation in real terms.

The chapters on State of the Economy and Monetary and Financial Sector Developments: The Cart and the Horse, highlight the positive outcomes of the new Corporate Insolvency Resolution Process, but the Survey omits to mention the average 69 per cent haircut to lenders in the resolution pro – cess. Moreover, delays in insolvency resolution are not mentioned in the main text, but are relegated to a box. Chapter 9: Agriculture and Food Management: Sector of the Future, reads like a Department of Agriculture handout, faithfully recounting the hundreds of schemes floated by the Central Government, and the money spent thereupon.

But the authors are silent about the fact that agricultural growth had been resilient despite the almost zero additional budgetary support from the Centre. For example, the current budget allocation for the Department of Agriculture and Farmers’ Welfare, which implements policies related to farmer welfare is 3 per cent lower than the revised estimates for FY 2024-25. Far from suggesting solutions to systemic problems like the declining size of land holdings and increase in the number of persons employed in agriculture, which has made agriculture unremunerative, the Survey chooses not to mention them at all. In another chapter ‘Prices and Inflation’ the Survey notes that ‘tomato and onion prices have been drivers of food inflation, and consequently headline inflation in recent months’ yet the Survey fails to review the ambitious TOP Scheme of the Government (2018), which had stabilisation of the prices of tomatoes, onions and potatoes as its main objective.

Unemployment is discussed at many places in the Survey, with an entire chapter, Employment and Skill Development: Existential Priorities, focusing on unemployment. The Survey notes that “Corporate profitability soared to a 15-year peak in FY24, … and for the Nifty 500 companies, the profitto-GDP ratio surged from 2.1 per cent in FY03 to 4.8 per cent in FY24, the highest since FY08. However, while profits surged, wages lagged. A striking disparity has emerged in corporate India: profits climbed 22.3 per cent in FY24, but employment grew by a mere 1.5 per cent.”

The Survey also noted a sharp focus on cost cutting over workforce expansion. Thus it would appear that the annual tax break of Rs.1.45 lakh crore and more, for companies since 2019 has not achieved its objective. According to classical economic theory, as a country progresses, employment shifts from the primary sector (agriculture) to the secondary sector (manufacturing) and finally to the tertiary sector (services). The Survey does note that the share of agricultural employment has risen from 44.1 per cent in 2017- 18 to 46.1 per cent in 2023-24, while the share of industry and services sectors saw declines in employment share, with manufacturing falling from 12.1 per cent to 11.4 per cent, and services from 31.1 per cent to 29.7 per cent during the same period, but makes no attempt to draw an obvious conclusion.

The Survey has suggested renewable energy and digital sectors for creating jobs, while last year’s favourites were food processing and healthcare. The basis of many conclusions of this chapter could be flawed because the Survey has used only indirect Government data in this chapter (the Government has done away with employment statistics since 2017-18), ignoring reliable statistics from reputed private sources like Centre for Monitoring Indian Economy (CMIE). A definite positive is that the Survey also ignores Reserve Bank statistics on employment, which claimed that 4.7 crore jobs were created in the last two years. As a redeeming feature there is an entire chapter, Labour in the AI Era: Crisis or Catalyst, that discusses employment challenges of the future, which may be germane for formulating future Government policy. Another topic running almost throughout the Survey is climate change, which is mentioned at many places, and encompasses a whole chapter ~ Climate and Environment: Adaptation Matters.

At the very beginning the Survey notes: “India’s Initial Adaptation Communication, submitted to the United Nations Framework Convention on Climate Change (UNFCCC) in December 2023, reveals that the total expenditure related to adaptation in FY22 was 5.6 per cent of the Gross Domestic Product (GDP), an increase from 3.7 per cent in FY16.” No details are given. To put it mildly, this figure appears doubtful. Also, the treatment of the topic is academic, focussing more on global climate change and prescriptions for combating climate change at the global level.

Happenings nearer home are pointedly ignored, with nary a mention of the landslides, horrendous forest fires, floods and heatwaves that have relentlessly ravaged our country in the last few years. At places, the Survey does talk about afforestation, but at the same time views a ban on cutting down of roadside trees, as an impediment to progress. The Survey makes an earnest appeal to the Government to get out of the way of businesses, no – ting that policies aimed at deregulation often floundered because “Adding layers of operational conditions to policies to prevent abuse makes them incomprehensible and regulations needlessly complicated, taking them further from their original purposes and intents.”

Going further, the Survey painstakingly draws a roadmap for deregulation, yet the basic assumption that the Government wants to deregulate and all stakeholders are fully on board, is rather naïve. All Governments believe in control, most private enterprises try only to maximise current profits, and straitened circumstances force most individuals into a day-t0-day existence. One can only wish that Government and business pay attention, to what economists prescribe.

(The writer is a retired Principal Chief Commissioner of Income-Tax)