Lok Sabha Question No. 1059 (UNSTARRED), answered on 2016-07-22
Subject: Domestic Savings
Ministry: FINANCE
Asked by: KAPIL MORESHWAR PATIL

- (a)  whether  any  annual  target  has  been  fixed  with  regard  to  domestic  savings  and  if  so,  the details

thereof;

- (b) the rate of increase in domestic savings vis-a-vis the increase in gross domestic product during each of the last three financial years; and
- (c) the steps taken by the Government to encourage the domestic savings and to push the economic growth?

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI ARJUN RAM MEGHWAL)

- (a) :  No specific annual target has been fixed by the Government for domestic savings.

(b): The latest year for which the Central Statistics Office (CSO) has brought out the figures of gross  savings  is  2014-15.  The  rate  of  growth  in  gross  savings  vis-a-vis  the  growth  in  gross domestic product from the year 2012-13 is given in the following table.

## Growth rate in Gross Savings and

## Gross Domestic Product (Per cent)

Gross Savings at current prices

GDP at constant

(2011-12)

market prices

GDP at current market prices

|                                         |   2012-13 |   2013-14 |   2014-15 | 2015-16 (PE)   |
|-----------------------------------------|-----------|-----------|-----------|----------------|
| Gross Savings at current prices         |      11.2 |      10.7 |      10.5 | NA             |
| GDP at constant (2011-12) market prices |       5.6 |       6.6 |       7.2 | 7.6            |
| GDP at current market prices            |      13.9 |      13.3 |      10.8 | 8.7            |

Source: Central Statistics Office.

PE: Provisional Estimates

NA: Not Available

(c):  Savings  are  realized  from  three  broad  categories  of  savers,  viz.  households,  private corporate  sector  and  public  sector.  Various  measures  have  been  taken  by  the  Government  to improve  household  financial  savings,  which, inter  alia ,  include:  re-launch  of  the  certificate savings  scheme  called  Kisan  Vikas  Patra;  Sukanya  Samriddhi  Yojana  to  contribute  to  the financial security to the girl child; and, Pradhan Mantri Jan-Dhan Yojana (PMJDY) which has been a landmark initiative of financial inclusion. The other initiatives like: increase in the limit of deduction under the Income Tax Act for health insurance premium, contribution to specific pension funds and contribution by the employees to National Pension Scheme; and, increasing the access to formal financial system by utilizing the postal network; also have the potential to boost household savings. The Government has also taken steps to popularise the Small Savings Schemes by carrying out publicity on an all-India basis. Greater public saving is sought to be achieved through  efforts  at  fiscal  consolidation,  including  rationalization  of  subsidies  and promotion of direct benefit transfer. The initiative to reduce corporate tax in a phased manner and various initiatives to encourage industry and enterprise are expected to improve corporate saving.

The  Government  of  India  has  taken  various  initiatives  to  boost  the  growth  of  the  economy which, inter  alia ,  include;  fillip  to  manufacturing  and  infrastructure  through  fiscal  incentives and concrete measures for transport, power, and other urban and rural infrastructure; substantive reforms and liberalization of foreign direct investment in major sectors; measures to debottleneck the supply of key raw materials; Skill India and Digital India initiatives; 'Make in India' initiative along with the attendant facilitatory measures for a more conducive environment  for  investment;  the  new  insolvency  and  bankruptcy  related  legislation;  Start-up India Initiative  to  boost  entrepreneurship  and    creation  of  jobs;  'Stand  Up  India  Scheme'  to promote entrepreneurship among SC/ST and women entrepreneurs; boost to agricultural sector with  focus  on  micro  irrigation,  watershed  development,  soil  conservation  and  credit;  and, various measures to improve clarity and transparency in economic policy-making.

*****