Economic Survey Says Universal Basic Income 'A Powerful Idea' But...

New Delhi: The economy should grow between 6.75 per cent and 7.5 per cent in the financial year beginning on April 1, a government report forecast on Tuesday.

The Economic Survey, which sets the scene for Finance Minister Arun Jaitley's fourth annual budget tomorrow, also said the implementation of wage hikes and muted tax receipts would put pressure on the fiscal deficit in 2017-18.

The survey was prepared by the Finance Ministry's Chief Economic Adviser Arvind Subramanian and describes Universal Basic Income, a form of social security in which everyone is allotted a basic allowance, as "a powerful idea" but one that's "not ready for implementation".

Here are the highlights of the report:

Growth

- 2017-18 GDP growth seen between 6.75 per cent and 7.5 per cent year on year

- GDP growth rate at constant market prices for the current year 2016-17 is placed at 7.1 per cent

Fiscal deficit

- Implementation of wage hike, muted tax receipts to put pressure on fiscal deficit in 2017-18

Demonetisation

- Remonetisation will ensure that the cash squeeze is eliminated by April 2017

Universal basic income

- Universal basic income (UBI) proposal a powerful idea, but not ready for implementation

- UBI an alternative to plethora of state subsidies for poverty alleviation

- UBI would cost between 4 per cent and 5 per cent of GDP