
Economic Survey 2025: India Poised for 6.3%-6.8% Growth Amid Global Uncertainties
Agartala, Jan 31, 2025, By Our Correspondent292
The Economic Survey for the fiscal year 2025-26, presented by Finance Minister Nirmala Sitharaman in Parliament on Friday, projects India's real GDP growth to range between 6.3% and 6.8%. This forecast takes into account both the potential opportunities and risks associated with economic growth in the coming year.
A significant driver of this growth is expected to be the government’s continued emphasis on micro, small, and medium enterprises (MSMEs), which play a crucial role in employment generation and overall economic expansion. Additionally, a strong rabi crop production is anticipated to boost rural incomes, thereby contributing to increased consumer demand and economic stability.
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The Economic Survey outlines that while India’s economic outlook for FY26 remains broadly balanced, several challenges persist. Geopolitical tensions and trade uncertainties, along with potential fluctuations in global commodity prices, could pose significant risks to growth. Domestically, the sustainability of private sector investment will be a key determinant. The ability of the private capital goods sector to translate its order books into tangible investments, along with an improvement in consumer sentiment and corporate wage growth, will be critical in sustaining economic momentum.
On the positive side, a recovery in rural demand—bolstered by an expected rebound in agricultural production—and the projected easing of food inflation will provide an impetus to short-term growth. A stable macroeconomic environment further strengthens this outlook. The Survey underscores the necessity for India to enhance its global competitiveness through comprehensive structural reforms and regulatory simplification at the grassroots level to sustain medium-term growth.
Inflation management has also been highlighted as a key success factor in maintaining economic stability. The Survey notes that inflation is currently under control, thanks to proactive government interventions. These measures include maintaining adequate buffer stocks of essential food items, implementing periodic open market releases, and facilitating imports during supply shortages. Despite global challenges, these efforts have helped ensure price stability and a conducive economic environment for growth.
The Survey also evaluates private consumption patterns in 2024-25, noting that domestic demand has remained steady, thereby contributing to economic resilience. Fiscal discipline, along with a strong external balance supported by a surplus in services trade and robust remittance inflows, has reinforced macroeconomic stability. These factors, in combination, have provided a solid foundation for sustained economic growth, even in the face of external uncertainties.
Additionally, the government’s focus on human capital development—spanning education, healthcare, skill development, and social infrastructure—has yielded significant progress. The Economic Survey highlights an upward trend in government expenditure on social services, which has increased from 23.3% of total expenditure in FY21 to 26.2% in FY25 (Budget Estimates). In absolute terms, the combined social services spending of the central and state governments rose from Rs 14.8 lakh crore in FY21 to Rs 25.7 lakh crore in FY25, reflecting a compounded annual growth rate (CAGR) over this period.
Chief Economic Advisor V. Anantha Nageswaran, in his remarks within the Survey, stresses the importance of systematic deregulation as a key focus under the next phase of the Ease of Doing Business initiative, referred to as ‘Ease of Doing Business 2.0.’ According to him, strategic and structured deregulation will be instrumental in driving economic growth, fostering innovation, and enhancing India’s global competitiveness. He particularly emphasizes the need for a thriving ‘Mittelstand’—a strong and resilient small and medium-sized enterprise (SME) sector—which can play a vital role in mitigating economic shocks, bolstering manufacturing ambitions, attracting long-term investments, and promoting employment-sensitive growth.
Furthermore, the Economic Survey 2025 brings attention to India's heightened vulnerability to climate change and underscores the urgent need for adaptation measures. It acknowledges that developing nations like India bear a disproportionate burden of climate change due to historical emissions by industrialized countries. Consequently, India must prioritize climate adaptation strategies to mitigate the adverse effects and build long-term environmental resilience.
In conclusion, the Economic Survey 2025 presents a comprehensive analysis of India’s economic trajectory, identifying both opportunities and risks. It reiterates the need for continued policy focus on inflation control, investment-driven growth, and systemic reforms to enhance ease of doing business. Additionally, it underscores the significance of social sector investment and climate adaptation as pivotal elements in ensuring sustainable and inclusive economic progress for the nation.