Economic Survey 2025-26 Outlook

The Economic Survey projects a growth rate of 6.3-6.8% for 2025-26, driven by a strong external account, fiscal consolidation, and stable private consumption. It emphasizes the importance of domestic growth levers over external factors in the coming years.

To sustain growth, the Survey calls for grassroots deregulation and structural reforms focusing on “economic freedom for individuals and organizations.”

Current Economic Landscape

• GDP growth for 2024-25 is estimated at 6.4%, the slowest in four years.
• Chief Economic Advisor V. Anantha Nageswaran highlighted the need to leverage the demographic dividend and deregulation to boost growth amidst global economic uncertainties.

Growth Strategy

• Achieving “Viksit Bharat” by 2047 requires an 8% growth rate and an investment rate of 35% of GDP.
• Investments in AI, robotics, biotechnology, and manufacturing are critical.
• Creating 7.85 million non-farm jobs annually, improving literacy rates, and developing future-ready infrastructure are essential goals.

Sectoral Insights

• The cement, steel, and mining sectors are expected to recover post-monsoon.
• Investment activities show early signs of revival.
• Food inflation is likely to ease, though global commodity risks persist.

Reform Potential and State Contributions

• States are categorized based on industrial and service strengths, with states like Maharashtra and Tamil Nadu excelling in dual sectors.
• Other states, including Bihar and Uttar Pradesh, show reform potential.

Global Challenges and Recommendations

• India’s solar energy production capacity remains limited, affecting infrastructure development.
• Strengthening domestic supply chains and attracting investments is crucial for competitiveness.
• Export diversification and strategic partnerships in high-value sectors like biotechnology are recommended.

Policy Priorities

• Empowering women, farmers, youth, and marginalized groups is essential for inclusive development.
• Legal and regulatory barriers to women’s workforce participation must be addressed.

The Survey concludes that a stable macroeconomic environment, easing inflation, and domestic investment growth will shape India’s economic trajectory despite global headwinds.