Everything You Need To Know About India’s ‘Report Card’ Ahead Of Union Budget 2025

The Union Budget for the upcoming fiscal year, 2025-26 or FY26, will come to pass on February 1, 2025. The Indian finance minister, Nirmala Sitharaman, will be presenting her 8th budget.

The budget session, the first parliamentary session of 2025, will be held from January 31 to April 4, 2025.

However, this session will be held in two tranches. The first one starts on January 31 and concludes on February 13. The second part of the session is to commence on March 10 and conclude on April 4.

Before the big day, that is February 1, there is another big day on the cards, the presentation of the Economic Survey of India. The report will be tabled in the parliament on January 31, a day before the budget.

What is an Economic Survey?

The Economic Survey of India is deemed as the ‘report card’ of the country’s performance over the past fiscal year. It presents the platform on which the government can take future steps to work towards the progress and growth of the country.

Furthermore, there are two sections to it. The main economic events of the year and a general assessment of the economy are typically included in Part A.

Particular topics including social security, poverty, healthcare, education, human development, and climate change, are covered in the second section or Part B.

Who Makes This Report?

The Economic Survey is annually prepared by the Department of economic Affairs, which comes under the Finance Ministry led by Nirmala Sitharaman. It is put together under the supervision of the country’s chief economic advisor.

The country’s current Chief Economic Advisor (CEA) is Venkatramanan Anantha Nageswaran.

The CEA’s job for the day does not end there, as Venkatramanan Anantha Nageswaran, as per routine, will later in the day be holding a press conference to talk about the Economic Survey.

Why is Presented Before The Budget?

The Economic Survey gives a window, allowing a view into the happenings of the country in its previous fiscal year. This allows the economy and its stakeholders, the government, the corporations, and the citizens alike, to gauge the potential and possibilities that can be explored in the new fiscal year.

This allows for change and manoeuvring depending upon the pattern developed in the previous fiscal year.

As is evident, the Economic Survey consists of data from previous calendar years, and it does not consist of the data of the last quarter of the fiscal year in its entirety.

In India, the fiscal year starts on April 1, and concludes on March 31, the next calendar year. As a result of this, data from the last of the 4 quarters of a fiscal year are not part of the report, as it (the quarter) is yet to transpire.

This economic survey may consist of data from the previous years, along with rest of 2024. The previous Economic Survey (2023-2014) presented before the full budget in July 2024, consisted of data until May 2024. In another example, the Economic Survey for 2022-23, carries data until December of 2023.

The presentation of the Economic Survey before the budget sets the tone for the budget and the economic outlook for the next fiscal year.

Why Is The Economic Survey Important?

The Economic Survey essentially talks about the state of the economy and where it stands, not just compared to the world around, but compared to itself (compared to previous years).

The importance of this survey emerges from its ability to help in setting realistic revenue and expenditure targets on the monetary end and societal change by highlighting social indicators like social security, poverty, healthcare, education, and human development.

This therefore gives the government the room to induce reforms in the country, whether it’s on the policy level or on a political level.

What are The Key Components Of An Economic Survey?

The reason why the Economic Survey is a crucial element of not just in the budgetary session but also in the economy at large is because of the components that make it.

The facets of an economic survey include, as mentioned before, a report on the State of the Economy, compared to itself and the world around it, compared to previous years.

Fiscal Developments

The country’s growth outlook is another factor that is included. The economic survey also looks into fiscal developments, which in turn gives us perspective and an overview of how Union Government finances are progressing.

In addition, it also gives us a gist of the happenings at the state level with an overview of State Government Finances.

Thereby it also shows the state of the Debt Profile of state and central governments.

It therefore also looks into the Balance of Payments.

Monetary Developments

The report also gives us a glimpse of the Monetary Management and Financial Intermediation of the country.

This gives us an understanding of the role and efficiency of the country’s monetary systems, including the central bank, the Reserve Bank of India.

This further exhibits the nature of monetary developments in the country along with information on the liquidity conditions in the country.

Inflation

Monetary policies further help us assist in understanding of some of the crucial aspects of the economy, that affect Indian citizens directly: Prices and Inflation.

The element of Price Stability is critical in any economy. This is because a vacillation in pricing can impact industrial output and larger consumption, creating a feedback loop.

Other Factors

Other factors involved in the making of an Economic Survey include a status report aspects like Infrastructure, trade in a globalised economy, navigating through crucial realms of tariffs, trade, energy prices, and international and bilateral treaties and deals.

In addition to that some of the other poignant issues that find a detailed mention in the Economic Survey include progress and change in Social Infrastructure and Employment, Climate Change and the Environment.

Most importantly, the Economic Survey presents the incumbent government’s vision of what it aspires to do for the country.