Economic Survey 2024–25: Know About Chief Economist Nageswaran and His Bold Observations

V Anantha Nageswaran, the Chief Economic Advisor (CEA) to the Government of India, is all set to present the Economic Survey 2024–25 on January 31 as the Budget session begins. It will lay out the government’s report card on the state of the Indian economy in the past financial year. His third survey is expected to focus on the country’s shifting import dependency and energy transition among other key focus areas.

Nageswaran, who replaced Krishnamurthy Subramanian to become the 18th CEA, was a part-time member of the Prime Minister’s Economic Advisory Council between 2019 and 2021. Apart from working for the government, he has worked as an author, educationist and consultant.

An alumnus of Indian Institute of Management, Ahmedabad and University of Massachusetts, Nageswaran has taught in many business schools and management institutes in India and abroad.

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Nageswaran's Bold Observations

In the Economic Survey presented in the past, he has made some striking observations about India’s economy and policy. Among them was an observation made on a concerning development in Indian start-ups, ‘flipping’—the process of transferring the entire ownership of an Indian company to an overseas entity. The Economic Survey 2022–23 highlighted that many Indian companies were getting headquartered overseas especially in destinations with “favourable legal environments” and “taxation policies”.

It noted, “Better protection and enforcement of IP [intellectual property] and tax treatment of Licensing revenue from IP, residential status of Founders, and agile corporate structures have been the reasons for “Flipping” in the Past.” It further mentioned that simplification of taxation and procedures of capital flows are needed to reverse this phenomenon.

Continuing the trend, Economic Survey 2023–24 highlighted that it would be a mistake to presume that India will take over the manufacturing space vacated by China due to changes in the global supply chains by imposing tariffs on its cheap goods. While emerging markets are resorting to import restrictions to deal with the "Chinese challenge", it is crucial to note that some of their goods are so cheap that no amount of tariff can reduce their price competitiveness, it said. They can move past these restrictions without being noticed since they are packaged in third countries, it added.

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Last year survey also underscored the need to generate an average of nearly 78.5 lakh jobs annually until 2030 in the non-farm sector to keep pace with the rising workforce. It suggested to boost the implementation of the existing schemes such as the production linked incentive, MITRA Textile scheme and MUDRA among others to achieve the target.

It also highlighted a remarkable surge in corporate sector profits, with profit before tax across more than 33,000 companies nearly quadrupling from FY20 to FY23. However, hiring and compensation growth is not reflected in this financial boom.

Nageswaran has also been vocal on key economic issues. His insights into the concerning trends in India’s economy have contributed to important discourse and policy focus. This year too, he is expected to highlight the same, giving some crucial suggestions.