New Delhi: India's real gross domestic product (GDP) is expected to grow at 6.3-6.8% year-on-year in the financial year 2025-26 (FY26), as per the Economic Survey 2024-25 tabled in the Parliament on Friday ahead of the Union Budget.
The Survey tabled by Union Finance Minister Nirmala Sitharaman said that while there are many upsides to domestic investment, output growth and disinflation in FY26, the economy faces equally strong downsides too.
"On balance of these considerations, we expect that the growth in FY26 would be between 6.3 and 6.8 per cent," the Survey said.
It further said that navigating global headwinds will require strategic and prudent policy management and reinforcing the domestic fundamentals.
India's GDP growth slowed down to nearly seven-quarter low of 5.4% year-on-year in the July-September quarter (Q2) of current financial year 2024-25 triggering downward revision in annual growth forecast by multiple agencies.
As per the first advance estimates of national accounts, India’s real GDP is estimated to grow by 6.4% in FY25.
"Looking ahead, India’s economic prospects for FY26 are balanced. Headwinds to growth include elevated geopolitical and trade uncertainties and possible commodity price shocks," the Economic Survey 2024-25 said.
The government's report card noted that domestically the translation of order books of private capital goods sector into sustained investment pick-up, improvements in consumer confidence, and corporate wage pick-up will be key to promoting growth. Further, it said that rural demand backed by a rebound in agricultural production, an anticipated easing of food inflation and a stable macro-economic environment provide an upside to near-term growth.
"Overall, India will need to improve its global competitiveness through grassroots-level structural reforms and deregulation to reinforce its medium-term growth potential," the Survey authored by Chief Economic Advisor (CEA) V. Anantha Nageswaran said.
