KEY-TERMS & CONCEPTS OF

ECONOMY SURVEY 2022-2023

ÁÁ CHAPTER-1 (STATE OF THE ECONOMY 2022-23: RECOVERY
COMPLETE)

 Economic Shock: Economic shocks are random, unpredictable events that have a widespread impact on
the economy and are caused by things outside the scope of economic models.
 Capital Expenditure (Capex): Capital expenditures are payments made for goods or services that are
recorded or capitalized on a company's balance sheet instead of expensed on the income statement.
 Advanced Economies (AEs): The term is generally used in a casual sense, referring to countries with decent
standards of living, a substantial accumulation of industrial capital, modern technologies, and institutions
that are firmly embedded within the global economy.
 Emerging Market Economies (EMEs): An emerging market economy is an economy that's transitioning
into a developed economy.
ƒƒ Emerging market economies typically feature a unified currency, stock market, and banking system;
they're in the process of industrializing.
ƒƒ Emerging market economies can offer greater returns to investors due to their rapid growth.
 Domestic private consumption: This is also called personal consumption or consumer expenditure.
Consumer expenditure is personal (mainly household) spending on goods and services.
ƒƒ Thus it includes imputed rents on owner-occupied dwellings; and administrative costs of life assurance
and pension funds.
ƒƒ It excludes; interest payments; the purchase of land and buildings; transfers abroad; all business
expenditure; and spending on second-hand goods, which reflects a transfer of ownership rather than
new production.
 “Pent-up” demand: Pent-up demand is when an economy experiences consumer demand for goods and
services that has been building up over time, typically due to a recession.
ƒƒ After delaying the purchasing of goods and services due to uncertainty surrounding economic
downturns, people typically are eager to spend money on consumer goods
 Capital Risk-Weighted Adjusted Ratio (CRAR): It is the ratio of a bank's capital to its risk-weighted assets
and current liabilities.
ƒƒ This ratio is utilized to secure depositors and boost the efficiency and stability of financial systems all
over the world.
 Budgeted capital expenditure: The capital expenditures budget identifies the amount of cash a company
will invest in projects and long‐term assets.
ƒƒ Although funds for expenditures may be identified and approved in total during the budget process,
most companies have a separate process for approving funds for the specific items included in a capital
expenditures budget.

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ÁÁ CHAPTER-2 (INDIA’S MEDIUM-TERM GROWTH OUTLOOK: WITH

OPTIMISM AND HOPE)

 Balance sheet stress: The stress test analyses how the impacts on the bank balance sheet will impact
the bank adversely in different economic situations.
ƒƒ Stress tests run by the Fed offer several different scenarios with multiple variables.
 Macroeconomic stability: Maintaining macroeconomic stability is critical for sustained and inclusive
development.
 Large swings in economic activity, high inflation, deteriorating fiscal positions, unsustainable debt levels and
volatile exchange rates are detrimental to the living standards of the most vulnerable.
 Non-debt-creating capital inflows: Non-debt creating capital receipts refer to those receipts of
the government which lead to a decrease in assets, and not an increase in liabilities. For instance,
disinvestment is a non-debt creating capital receipt.
 Minor economic offences: The NCRB report categorizes the economic offences booked under the IPC in
three major heads. These are criminal breach of trust; forgery, cheating & fraud; and counterfeiting
 Retrospective taxation: Retrospective taxation allows a nation to implement a rule to impose a tax on
certain products, goods or services and deals and charge companies from a time before the date on
which the law is passed
 Dividend Distribution tax: A dividend is nothing but a distribution of a portion of a company’s earnings.
 A dividend distributions tax is nothing but a tax levied on the profits distributed by Indian Companies
to its investors or shareholders.
 As per the provisions of the income tax act, the tax is levied on the company before distributing dividends.

ÁÁ CHAPTER-3 (FISCAL DEVELOPMENTS: REVENUE RELISH)

Key Terms:
 Fiscal pressure: The mismatch of routine power and financial power causes huge financial pressure of local
government.
 Gross Tax Revenue: Tax Revenue forms part of the Receipt Budget, which in turn is a part of the Annual
Financial Statement of the Union Budget. It gives a detailed report on revenue collected from different items
like corporation tax, income tax, wealth tax, customs, union excise, service, taxes on Union Territories like
land revenue, stamp registration etc.
 Fiscal deficit: Fiscal deficit is the difference between the total revenue and total expenditure of a government
in a financial year.
 Net borrowing ceilings (NBC): The Net Borrowing Ceiling (NBC) of the States for the year 2022-23 has
been determined at Rs. 8,57,849 crore at 3.5% of GSDP based on the GSDP data published by NSO and
methodology prescribed by 15th Finance Commission.
 Capital expenditure: Capital expenditures (CapEx) are funds used by a company to acquire, upgrade, and
maintain physical assets such as property, plants, buildings, technology, or equipment.
 Gross State Domestic Product (GSDP): Gross State Domestic Product (GSDP) is a measure in monetary
terms, the sum total volume of all finished goods and services produced during a given period of time,
usually a year, within the geographical boundaries of the State, accounted without duplication.
 Sovereign external debt: Sovereign debt is the government debt owed by a country, a sovereign nation.
The debt exists in the form of government-issued securities and direct loans from financial institutions.

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ECONOMY 01 | Key-Terms & Concepts Of Economy Survey 2022-2023

 Dated securities: Dated Government securities are long term securities or bonds of the government that
carries a fixed or floating coupon (interest rate).
 Anonymised Escalation Mechanism: CBIC has launched an Anonymised Escalation Mechanism for handling
the grievances related to delay in clearances. In the above mechanism, CBIC’s ICEGATE registered users can
submit their grievance for delayed clearances under faceless assessment and escalate it anonymously to
the concerned assessing as well as the higher officers at relevant FAG Port (Faceless Assessment Group). The
Anonymized Escalation facility also enables users to track the status of the grievances submitted by them
till the final resolution.

ÁÁ CHAPTER 4 (MONETARY MANAGEMENT AND FINANCIAL INTER

MEDIATION: A GOOD YEAR)

 Government Securities (G-Sec) Market: A Government Security (G-Sec) is a tradeable instrument issued
by the Central Government or the State Governments. It acknowledges the Government’s debt obligation.
Such securities are short term (usually called treasury bills, with original maturities of less than one year) or
long term (usually called Government bonds or dated securities with original maturity of one year or more).
 Foreign Portfolio Investment (FPI): Foreign portfolio investment (FPI) consists of securities and other
financial assets held by investors in another country. It does not provide the investor with direct ownership
of a company’s assets and is relatively liquid depending on the volatility of the market.
 India Volatility Index (VIX): India VIX refers to the India Volatility index. It measures the amount of volatility
that traders expect over the next thirty days in the NSE index. Simply, it is a calculation of price swings
investors expect in the market over important market news.
 Policy Repo Rate: The repo rate is the interest rate at which the Reserve Bank of India (RBI) loans money to
commercial banks which is determined through the monetary policy of RBI.
 Standing Deposit Facility (SDF): The Standing Deposit Facility, proposed to be introduced by the RBI, is a
collateral free liquidity absorption mechanism that aims to absorb liquidity from the commercial banking
system into the RBI. Government in the Budget’s (2018) Finance Act included a provision for the introduction
of the Standing Deposit Facility (SDF).
 Liquidity Adjustment Facility (LAF) Corridor: Liquidity adjustment facility (LAF), also known as the
liquidity corridor, essentially indicates the difference between the repo rate and the reverse repo rate. It was
introduced in year 2000 following recommendation of Narasimham Committee Report on Banking Reforms.
 Cash Reserve Ratio (CRR): The Cash Reserve Ratio (CRR) is the percentage of total deposits a bank must
have in cash to operate risk-free. The Reserve Bank of India decides the amount and is kept with them for
financial security.
 Reserve Money (M0): Reserve money is the most important form of money supply. It is also called as
high-powered money, base money and central bank money. Reserve money (M0) = Currency in Circulation
+ Bankers’ Deposits with RBI + ‘Other’ Deposits with RBI.
 Variable Rate Repo (VRR) The VRR is usually undertaken to reduce the money flow by taking out existing
cash present in the system. The central bank performs it to rebalance the surplus liquidity in the system by
shifting it out of the fixed-rate overnight reverse repo window to VRR auctions of longer maturity.
 Weighted Average Lending Rate (WALR): A weighted average interest rate is an average that is adjusted
to reflect the contribution of each loan to the total debt. The weighted average multiplies each loan’s
interest rate by the loan balance and divides the sum by the total loan balance.
 Provisioning Coverage Ratio (PCR): A Provisioning Coverage Ratio or PCR is the percentage of funds that
a bank sets aside for losses due to bad debts. A high PCR can be beneficial to banks to buffer themselves
against losses if the NPAs start increasing faster.
 Capital Conservation Buffer (CCB): The capital conservation buffer (CCoB) is a capital buffer amounting to
2.5% of a bank’s total exposures. It must be made up of Common Equity Tier 1 capital.
 Risk-Weighted Assets (Rwas): Risk-weighted assets are used to determine the minimum amount of capital
a bank must hold in relation to the risk profile of its lending activities and other assets.

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 Corporate Insolvency Resolution Processes (Cirps): Corporate Insolvency Resolution Process (CIRP) is
the process of resolving the corporate insolvency of a corporate debtor in accordance with the provisions
of the Code.
 Domestic Institutional Investors (Diis): Domestic institutional investors are those institutional investors
which undertake investment in securities and other financial assets of the country they are based in.
 Crypto Assets: Crypto assets are purely digital assets that use public ledgers over the internet to prove
ownership. They use cryptography, peer-to-peer networks and a distributed ledger technology (DLT) – such
as blockchain – to create, verify and secure transactions.
 International Financial Centres (Ifcs): An International Financial Centre, or IFC, is a physical area from
which financial services are provided to people in other countries.
 Assets Under Management (Aum): Assets under management (AUM) is the total market value of the
investments that a person or entity handles on behalf of investors.

ÁÁ CHAPTER 5 PRICES AND INFLATION: SUCCESSFUL TIGHT-ROPE

WALKING

 Consumer Price Index:- It measures price changes from the perspective of a retail buyer. It is released by
the National Statistical Office (NSO).
 Wholesale Price Index Inflation:- It measures the changes in the prices of goods sold and traded in bulk
by wholesale businesses to other businesses. It is published by the Office of Economic Adviser, Ministry of
Commerce and Industry.
 Liquidity Adjustment Facility:-A LAF is a monetary policy tool used in India by the RBI through which it
injects or absorbs liquidity into or from the banking system.
 Essential Commodities -There is no specific definition of essential commodities in the Essential Commodities
Act, 1955.
 Section 2(A) of the Act states that an “essential commodity” means a commodity specified in the Schedule
of the Act. The Act gives powers to the central government to add or remove a commodity in the Schedule.

ÁÁ CHAPTER 6 (SOCIAL INFRASTRUCTURE AND EMPLOYMENT)

 Reproductive, Maternal, Newborn, Child Plus Adolescent Health (RMNCH+A) : RMNCH+A approach
launched in 2013, essentially looks to address the major causes of mortality among women and children as
well as the delays in accessing and utilizing health care and services.
 Geotagging– It is the process of adding geographical identification like latitude and longitude to various
media such as a photo or video. Geotagging can help users find a wide variety of location-specific information
from a device. It provides users the location of the content of a given picture.
 Gender Inequality Index (GII):- The GII is an inequality index released by UNDP. It measures gender
inequalities in three important aspects of human development—
ƒƒ Reproductive Health, measured by maternal mortality ratio and adolescent birth rates;
ƒƒ Empowerment, measured by proportion of parliamentary seats occupied by females and proportion
of adult females and males aged 25 years and older with at least some secondary education
ƒƒ Economic status, expressed as labour market participation and measured by labour force participation
rate of female and male populations aged 15 years and older.
 Female Labour Force Participation Rate (FLFPR): The labour force consists of people who are 15 years or
older, and belong to either of the following two categories:-
ƒƒ Are employed
ƒƒ Are unemployed and are willing to work and are actively looking for a job.

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ECONOMY 01 | Key-Terms & Concepts Of Economy Survey 2022-2023

ÁÁ CHAPTER 7 (CLIMATE CHANGE AND ENVIRONMENT: PREPARING TO

FACE THE FUTURE)

 Forest carbon stock: Forest carbon stock is the amount of carbon that has been sequestered from the
atmosphere and is now stored within the forest ecosystem, mainly within living biomass and soil, and to a
lesser extent also in dead wood and litter.
 Rare earth elements: The rare earth elements (REE) are a set of seventeen metallic elements. These include
the fifteen lanthanides on the periodic table plus scandium and yttrium.
 ESG Investing: Environmental, Social, and Governance (ESG) is a criterion used by investors for screening
companies. Investors increasingly prefer a company which is environment-oriented and has high corporate
governance standards. The ESG criteria are a set of standards for a company’s operations that socially
conscious investors use to screen potential investments.

ÁÁ CHAPTER 8 AGRICULTURE AND FOOD MANAGEMENT: FROM FOOD

SECURITY TO NUTRITIONAL SECURITY

 Agriculture Infrastructure Fund: Agriculture Infrastructure Fund is a central sector scheme which enables
a financing facility of Rs.1 lakh crore for funding agriculture infrastructure projects at farm-gate and
aggregation points such as farmer producer organizations, primary agricultural cooperatives, startups and
entrepreneurs in the agriculture sector.
 Custom hiring Centers: Custom Hiring Centre (CHC) are basically a unit comprising a set of farm machinery,
implements and equipment meant for custom hiring by farmers. The main objective of CHC is to supply of
farm implements to small, marginal and poor farmers at subsidized rates on hire.
 Zero Budget Natural Farming (ZBNF): It is a method of chemical-free agriculture drawing from traditional
Indian practices. Using cow dung, urine based formulations and botanical extracts would help farmers in
reducing the input cost. Intercropping with leguminous crops is one of the components of ZBNF and it
improves the crop productivity and soil fertility by way of fixing the atmospheric nitrogen. It promotes soil
aeration, minimal watering, intercropping, bunds and topsoil mulching and discourages intensive irrigation
and deep ploughing.
 Primary Agricultural Cooperative credit societies (PACS): PACS constitute the lowest tier of the three-
tier Short-term cooperative credit in the country comprising of approx.13 Cr. farmers as its members, which
is crucial for the development of the rural economy.
 One District, One Product Programme (ODOP): ODOP aims to encourage indigenous and specialized
products and crafts. It is programme for every district in the country to expand the outreach of their ‘special’
product not just in India but across the world.

ÁÁ CHAPTER 9 (INDUSTRY STEADY RECOVERY)

 Industrial Production (IIP)- The Index of Industrial Production is an index for India which details out the
growth of various sectors in an economy such as mineral mining, electricity and manufacturing.
 Credit Linked Guarantee Scheme ( CGSS)- CGSS is aimed at providing credit guarantee up to a specified
limit against loans extended by Member Institutions (MIs) to finance eligible borrowers
 Gross Fixed Capital Formation - Gross fixed capital formation is a macroeconomic concept used in official
national accounts such as the United Nations System of National Accounts, National Income and Product
Accounts and the European System of Accounts.
 Marginal costs of funds-based lending rate (MCLR)- Marginal Cost of Funds based Lending Rate (MCLR)
is the minimum lending rate below which a bank is not permitted to lend. MCLR replaced the earlier base

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rate system to determine the lending rates for commercial banks. RBI implemented MCLR on 1 April 2016
to determine rates of interests for loans.
 Trade Receivables Discounting System (TReDS)- ReDS is an electronic platform for facilitating the
financing / discounting of trade receivables of Micro, Small and Medium Enterprises (MSMEs) through
multiple financiers. These receivables can be due from corporates and other buyers, including Government
Departments and Public Sector Undertakings (PSUs).
 Global Innovation Index (GII)- The Global Innovation Index which is published annually, has been a leading
reference for measuring an economy’s innovation performance.
 Fourth industrial revolution- The Fourth Industrial Revolution, 4IR, or Industry 4.0, conceptualises rapid
change to technology, industries, and societal patterns and processes in the 21st century due to increasing
interconnectivity and smart automation.
 Production Linked Incentive (PLI) schemes- Production Linked Incentive, or PLI, scheme of the Government
of India is a form of performance-linked incentive to give companies incentives on incremental sales from
products manufactured in domestic units. It is aimed at boosting the manufacturing sector and to reduce
imports.

ÁÁ CHAPTER 10 (SERVICES: SOURCE OF STRENGTH)

 Neobanks: These are new-age banks without any physical location, present entirely online. They provide
digital, mobile-first financial solutions for payments, money transfers, lending, and more. They allow
customers to make deposits and withdraw money. They offer debit cards, investment facilities, and more.
They even provide credit and lending services. However, most neobanks do not have a banking license and
cannot operate stand-alone — most neobanks partner with licensed banks to provide financial services.
 Global Real Estate Transparency Index: The Global Real Estate Transparency Index is based on a global
survey of JLL and LaSalle’s extensive network of real estate market experts. This 12th edition includes 254
individual indicators to assess market transparency across 94 countries and territories and 156 cities globally
and is an essential guide for companies operating in foreign markets. During this time of heightened
uncertainty and rapid change across the real estate industry, the topic of transparency is even more
important than ever before.
 World Tourism Barometer: The World Tourism rankings are compiled by the United Nations World Tourism
Organization as part of their World Tourism Barometer publication, which is released up to six times per year.
In the publication, destinations are ranked by the number of international visitor arrivals, by the revenue
generated by inbound tourism, and by the expenditure of outbound travellers.
 PMI: The Purchasing Managers’ Index (PMI) is an index of the prevailing direction of economic trends in
the manufacturing and service sectors. It consists of a diffusion index that summarizes whether market
conditions, as viewed by purchasing managers, are expanding, staying the same, or contracting. The
purpose of the PMI is to provide information about current and future business conditions to company
decision makers, analysts, and investors.
 Account Aggregator Framework: The Account Aggregator (AA) is an NBFC that collects the financial
information of customers and transfers them from one financial institution to another, after the explicit
consent of the customers. Entities can enroll as either a Financial Information Provider (FIP) or Financial
Information User (FIU) regulated by a financial sector regulator.

ÁÁ CHAPTER 11 (EXTERNAL SECTOR: WATCHFUL AND HOPEFUL)

 Export Preparedness Index - The EPI identifies several opportunities and challenges in the export sector
at the State level.
 Free Trade Agreements- A Free trade Agreement (FTA) is an agreement between two or more countries

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ECONOMY 01 | Key-Terms & Concepts Of Economy Survey 2022-2023

where the countries agree on certain obligations that affect trade in goods and services, and protections for
investors and intellectual property rights, among other topics.
 Agricultural and Processed Food Products Export Development Authority (APEDA)- The Agricultural
and Processed Food Products Export Development Authority (APEDA) is an Indian Apex-Export Trade
Promotion Active government body.
 The Export Credit Guarantee Corporation (ECGC)- The ECGC Ltd. (formerly known as Export Credit
Guarantee Corporation of India Ltd.) wholly owned by government of India, was set up in 1957 with the
objective of promoting exports from the country by providing credit risk insurance and related services for
exports.
 Preferential Trade Agreements (PTAs)- This is the term used in the WTO for trade preferences, such as
lower or zero tariffs, which a member may offer to a trade partner unilaterally.

ÁÁ CHAPTER 12 (PHYSICAL AND DIGITAL INFRASTRUCTURE - LIFTING

POTENTIAL GROWTH)

 Social Overhead Capital - Social overhead capital includes all the ‘basic’ services required in the production
process such as, transport, irrigation, energy, education, health and medical facilities.
 Asset Monetisation - Converting tangible or intangible assets into a source of generating revenue.
 OpenForge - Use of open-source software and sharing and reuse of e-governance-related source.

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