Content Chapter Page No. Section 1 : Overview From to 1 Introduction 2 Macro Economic Outlook 2018-19 Section 2: Policy Choices 1 Incentives Vs Infrastructure 2 Public Expenditure Policy: Actuals Vs Norms Section 3: New Initiatives 1 Implementation of GST in J&K State 2 Ease of Doing Business 3 Introduction of Pay & Accounts Office System 4 Public Financial Management System (PFMS) 5 Budget Estimation Allocation Monitoring System (BEAMS) Section 4: Key Policy Concerns 1 Employment 2 Poverty 3 Prices and Food Management Section 5: Sectoral Review 1 Economic Sectors 1.1 Agriculture 1.2 Horticulture 1.3 Tourism 1.4 Industries 1.5 Environment & Forests 1.6 Livestock 2 Infrastructure & Development Sectors 2.1 Roads and Buildings 2.2 Transport and Communication 2.3 Power 2.4 Public Health Engineering 2.5 Housing & Urban Development 3 Social Sectors 3.1 Social Welfare 3.2 Education 3.3 Health 3.4 Rural Development 3.5 Labour 3.6 Culture 4 Financial Sectors 4.1 State Finances 4.2 Budgetary Policy 4.3 Banking and Finance 4.4 Cooperatives Section 1 Overview Chapter 1 Introduction The current document of Economic Survey 2017 is being presented at a time when the whole country has gone through two major structural reforms namely 1) Demonetisation and 2) introduction of single Tax regime of GST. The state of J&K has also gone through these structural reforms along with rest of the country. Economic Survey 2017 takes stock of the developments having taken place during the last financial year 2016-17 and current financial year 2017-18 upto Nov, 2017 in J&K economy. The survey highlights progress made in major developmental programmes launched in 2016-17 and 2017-18 and also showcase the policy initiatives of the Government. In the current edition of the Economy Survey, the initiatives taken by the Government to streamline and improve Financial Management Systems are prominently discussed. The Government has transformed the budget into four main sub-groups which are: 1. Economic Sector 2. Infrastructure sector 3. Social sector and 4. General service sector Similarly, Budget Estimation, Allocation & Monitoring System (BEAMS) has also been introduced by the Government to put the whole financial system on IT platform. The initiatives of the Government to shift from traditional Treasury System to Pay and Accounts Office System is also showcased and discussed. The initiatives of the Government to introduce Public Finance Management System (PFMS) is also prominent to showcase the progress. The progress made by the state on the front of Ease of Doing Business which has now improved from 29th to 22nd place is discussed in the report. The document also highlights the investment made by the Government in major developmental and welfare sectors vis-a-vis Gross Domestic Product of the State (GSDP). This will surely give new direction to the Government while assigning priorities by making decisions on development of overall economy of the state. With detailed statistical data covering all aspects of the economy-macro as well as sectoral-the report provides an overview of the following issues: - 1 Economic Survey 2017 1. Macro-Economic Outlook 2. Policy Choices 3. New Initiatives 4. Key Policy Concern 5. Sectoral Review This document would be useful for policy makers, economists, policy analysts, business practitioners, government agencies, students, researchers, the media and all those interested in the development of J&K economy. The current issue of Economic Survey 2017 would also provide a window to the policy makers, decision making authorities and others at the helm of affairs to take factual economic scenario into account while making decisions regarding development of the state. 2 Chapter 2 Macro Economic Outlook 2018-19 The figurative description of Gross State Domestic Product (GSDP) and its related aggregates are perhaps the only indicators of the state economy that showcase whether the state has made any progress in economic terms over a period of time. It highlights the economic progress made by individuals of the state by indicating the per capita income which reflects changes having taken place in standard of living of the people of the state. GSDP is generally termed as State Income which is grouped into three main sectors namely i) Agriculture and allied activities, ii) Industries sector and iii) Services sector. Updating the data from time to time and shifting the base year to 2011 under the directions and guidance of GoI undertaken by Directorate of Economics & Statistics reflects the structural and sectoral shifts that are likely to take place in a developing economy that could be properly gauged and captured. The shifting of base removes the wide gaps between Base year and the Reporting year caused due to inflation over a period of time. The SDP estimates of economy over a period of time reveal the extent and direction of the changes in the levels of economic development. GSDP estimates when studied in relation to the total population of the state indicate the level of per capita net output of goods and services available or standard of living of the people of the State. The Gross State Domestic Product (GSDP) at constant (2011-12) prices for the year 2017-18 is estimated at Rs. 109136.52 crore, as against the estimate of Rs 100597.57 crore for 2016- 17, indicating growth of 8.49 per cent during 2017-18. At current prices, GSDP for 2017-18 is estimated to be Rs 140886.76 crore as against the estimate of Rs. 126230.91 crore for 2016- 17, showing an increase of 11.61 per cent during the year. The projected estimates for the year 2018-19 at constant (2011-12) prices and current prices of GSDP is Rs 116637.44 crore and Rs 157383.77 crore. The estimate of State Income (i.e. Net State Income) at constant (2011- 12) prices for 2017- 18 is Rs. 90902.60 crore, as against the estimate of Rs 83717.39 crore for 2016-17, suggesting a rise of 8.58 per cent during 2017-18. At current prices, the State Income for 2017-18 is estimated at Rs. 119294.71 crore as compared to the estimate of Rs. 106326.40 crore for 2016-17, showing a rise of 12.20 per cent during the year. The Net State Income at constant (2011-12) prices and current prices are roughly estimated at Rs 97352.75 crore and Rs 133596.72 crore respectively for the year 2018-19. 3 Economic Survey 2017 The per capita real income, i.e. per capita net state income at constant (2011-12) prices, for 2017-18 is estimated at Rs. 65615 as against the estimate of Rs 61349 for 2016-17. This indicates a growth of per capita real income of about 6.95 per cent during 2016-17. The per capita income at current prices during 2017-18 is estimated at Rs. 86108 as compared to Rs.77918 in 2016-17 showing a rise of 10.51 per cent. The roughly estimated per capita income at constant (2011-12) prices and current prices of J&K state for the year 2018-19 is Rs 69221 and Rs 94992 respectively The state economy is expected to register growth of 8.49% (Advanced) during the financial year 2017-18 at constant prices of 2011-12 as compared to growth rate of 3.29% achieved during 2016-17. The projected growth for the year 2018-19 is roughly estimated at 6.87%. The share of product taxes in total Gross State Value Added (GSVA) at basic price for the year 2016-17 and 2017-18 is 10.50% and 11.02% respectively. The share of product subsidies in total Gross State Value Added (GSVA) at basic price for the year 2016-17 and 2017-18 is 2.10% and 1.95% respectively. The projected trend in share of product taxes and product subsides for financial years 2011- 12 to 2018-19 is given below:- Projected trend in share of product taxes and product subsides Base 2018- S. year 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 Sector 19(rough No 2011-12 (P) (P) (P) (2R) (1R) (A) est.) (P) Total GSVA 1 at basic 74760.73 77015.87 80735.50 77787.15 90865.00 92805.63 100058.97 105999.14 prices Product 2 5515.20 6114.26 6515.12 6462.00 8495.81 9744.34 11029.95 12590.70 Taxes (+) Product 3 2020.38 2355.19 2163.39 1987.00 1971.00 1952.40 1952.40 1952.40 Subsides (-) GSDP(GSVA 4 + Taxes- 78255.55 80774.94 85087.23 82262.15 97389.81 100597.57 109136.52 116637.44 Subsides) Share of Product 5 7.38 7.94 8.07 8.31 9.35 10.50 11.02 11.88 Taxes in GSVA (%) Share of Product 6 2.70 3.06 2.68 2.55 2.17 2.10 1.95 1.84 subsidies in GSVA (%) 4 Economic Survey 2017 Per capita income The per capita income during 2017-18 at constant 2011-12 prices (NSDP) is estimated at Rs.65615 while the per capita income of Rs. 61349 was registered in financial year 2016-17. The per capita income during 2017-18 at current prices is estimated at Rs. 86108 while per capita income during 2016-17 stood at Rs. 77918 at current Prices. The projected per capita income at current and constant 2011-12 prices for the year 2018-19 are roughly estimated at Rs. 94992 and Rs.69221 respectively. Trend of per capita income (Figures in Rupees) Year Constant Prices Current Prices 2011-12 53173 53173 2012-13 52413 56834 2013-14 54066 61108 2014-15 50641 61185 2015-16 59824 73054 2016-17(1R) 61349 77918 2017-18 (A) 65615 86108 2018-19(crude) 69221 94992 5 Economic Survey 2017 Agriculture & Allied Sector At constant 2011-12 prices, agriculture & allied sector is likely to grow at 8.37% in the year 2017-18(A) as compared to growth rate (-)4.24% in 2012-13, 3.99 % in 2013-14, (- )10.91% in 2014-15, 24.74% in 2015-16 and 2.49% in 2016-17.The sector is expected to grow at 6.81 % as per the rough estimates for the year 2018-19.