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The Economic Survey 2025–26 highlights India’s continued position as the fastest-growing major economy, driven by strong domestic demand, resilient agriculture, robust manufacturing, controlled inflation, and stable external finances, supporting the vision of achieving Viksit Bharat by 2047.
India Remains Fastest-Growing Major Economy
New Delhi: India continues as the fastest-growing major economy for the fourth consecutive year despite a fragile geopolitical environment. Economic growth (GDP growth) for the current financial year (2025–26) is estimated at 7.4 per cent, driven by the twin engines of consumption and investment.
“It reaffirms India’s status as the fastest-growing major economy for the fourth consecutive year,” said V. Anantha Nageswaran, Chief Economic Advisor, Ministry of Finance, while highlighting the Economic Survey 2025–26 tabled in Parliament today.
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The Survey projects real GDP growth for FY27 at 6.8–7.2 per cent, while India’s potential growth is estimated at around 7 per cent.
Responding to a question on whether this growth is sufficient to achieve Viksit Bharat by 2047, Nageswaran said that a 7 per cent average growth, translating to 8 per cent-plus growth in USD terms on a sustainable basis, would enable India to meet the 2047 target.
He added that India’s growth momentum is driven by strong domestic fundamentals, and the country has performed well despite ongoing global geopolitical challenges.
The Survey highlights that agriculture and allied services are estimated to grow by 3.1 per cent in FY26. Agricultural activity in the first half of FY26 was supported by a favourable monsoon. Agricultural GVA grew by 3.6 per cent, higher than the 2.7 per cent growth recorded in the first half of FY25, though still below the long-term average of 4.5 per cent.
Allied activities, particularly livestock and fisheries, have shown relatively stable growth of 5–6 per cent. As their share in agricultural GVA has increased, overall agricultural growth increasingly reflects a combination of volatile crop output and stable allied sector expansion.
On the inflation front, the Chief Economic Advisor stated that inflation has softened significantly, with the headline Consumer Price Index (CPI) declining to an all-time low of 1.7 per cent (up to December 2025).
The Economic Survey 2025-26, tabled in Parliament by Union Finance Minister Nirmala Sitharaman
The industrial sector is showing signs of strength, with manufacturing growth at 8.4 per cent in the first half of FY26, surpassing the FY26 estimate of 7.0 per cent. The construction sector has remained resilient, supported by sustained public capital expenditure and ongoing infrastructure projects.
The manufacturing sector’s share has remained steady at around 17–18 per cent in real (constant price) terms.
Against global trade uncertainty, India’s total exports (merchandise and services) reached a record USD 825.3 billion in FY25, with continued momentum in FY26. Despite higher tariffs imposed by the United States, merchandise exports grew by 2.4 per cent (April–December 2025), while services exports rose by 6.5 per cent.
Economic Survey 2025–26: Indian Economy expected to grow 6.8%-7.2% in FY27
Merchandise imports increased by 5.9 per cent during the same period. The rise in the merchandise trade deficit was offset by a growing services trade surplus, while strong remittance inflows—which in many years exceed gross FDI—continued to support external stability. As a result, the current account deficit remained moderate at 0.8 per cent of GDP in H1 FY26.
India’s external sector remains comfortable in the short term. Foreign exchange reserves cover over 11 months of imports as of 16 January 2026 and around 94 per cent of external debt as of September 2025, providing a strong liquidity cushion.
The Survey notes India’s diversified trade strategy, highlighted by trade agreements with the UK, Oman, and New Zealand, and the recently concluded India–EU Free Trade Agreement, pending ratification by the European Parliament. Ongoing negotiations with the United States are also expected to boost exports.
The Economic Survey serves as the government’s annual report card for the previous year and is traditionally presented one day before the Union Budget, which will be tabled on February 1.
