Economic Survey 2024: Financial market valuations are elevated, India needs to create 80 lakh jobs per annum, says CEA

Economic Survey 2024: Government of India's Chief Economic Advisor (CEA) V. Anantha Nageswaran said that the government is optimistic about the growth but is mindful of the challenges as the global environment becomes polarised and financial market valuations are elevated.

“We are actually very optimistic about growth but we are also mindful of the challenges which I listed to you about the way the monsoon has progressed about how since we wrote the interim economic survey in January where we were more confident about 7 per cent since then the global environment has become even more polarised and financial market valuations are much more elevated," said V. Anantha Nageswaran, Chief Economic Advisor (CEA) of the Government of India addressing the press.

“So given that we feel 7 per cent is doable, we want to be not necessarily cautious but somewhat prudent in projecting. We would rather be very pleasantly surprised than be forced to face disappointments; that is why we are projecting a growth rate between 6.5 to 7 per cent,” he said.

CEA Nageswaran's address to the press comes before Finance Minister Nirmala Sitharaman's Union budget 2024 announcement on July 23. The chief economist also said that the country must generate nearly 8 million or 80 lakh jobs annually.

“We estimate that India needs to create roughly around 8 million jobs or 80 lakh jobs per annum,” said Nageswaran.

The Economic Survey highlighted that India has seen an average growth rate of 8 per cent in the last three years and the real GDP has been 20 per cent above since the pre-pandemic levels contributed from the share of private consumption and recovering capital formation, as per the report.

“Households are not in distress,” said Nageswaran. According to the chief economist, households are investing in the financial markets and the recent influx of retail investors into the stock markets through Systematic Investment Plans (SIPs) and Mutual Fund investments have resulted in them doing “very well” in the last four years.

“Our national income data do not record these at market prices, that is the reason why there is a feeling that financial liabilities have grown faster than financial assets of households. But financial assets of households are not mark-to-market so households are doing quite well,” said V. Anantha Nageswaran, Chief Economic Advisor (CEA) of the Government of India.