India's Economic Survey sees the growth rate for the coming fiscal to remain at 7-7.75 percent due to domestic factors and warns that the upcoming budget will have to contend with an unusually challenging and weak external environment.
The survey, tabled in parliament by Finance Minister Arun Jaitley here on Friday, also expresses concern over pan-India GST being elusive, the divestment programme falling short of target and recast of the distortive subsidy regime, especially for fertilisers, being a work-in-progress.
This apart, the survey says, balance sheets of Indian banks remain stressed, becoming a roadblock to the revival of private investments, adding to the anxiety that the country's growth potential of 8-10 percent in the long term.
"This year's survey comes against the backdrop of an unusually volatile external environment with significant risks of weaker global activity and non-trivial risks of extreme events," says the survey, authored by Chief Economic Advisor Arvind Subramanian.
"Fortifying the Indian economy against possible spill-over is consequently one obvious necessity. Another necessity is recalibration of expectations," it says, and warns that if the world lurches into a crisis or slides further into weakness, India's growth, too, will be severely affected.