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The Economic Survey shows a consistent expectation for rising cost of living and usage, with country need positioned for renovation.
Economic Survey 2025 Highlights
Economic Survey 2024-25 Highlights: Union Finance Minister Nirmala Sitharaman tabled the Economic Survey 2024-25 in Parliament onFriday The Survey anticipates that India’s GDP development for FY26 is anticipated to variety in between 6.3% and 6.8%, in the middle of international unpredictabilities. The Economic Survey shows a consistent expectation for rising cost of living and usage, with country need positioned for renovation. This record existed simply 6 months after the previous one, adhering to the basic political elections kept in July 2024.
The Economic Survey is a vital record that lays out India’s financial efficiency, federal government plans, and estimates for the upcoming . It is prepared by the Economic Division of the Department of Economic Affairs, led by the Chief Economic Advisor (CEA).
Here are the Key Highlights from the Economic Survey 2024-25:
1. Global Economic Overview
The international economic climate showed consistent yet irregular development in 2024, prevented by a stagnation in production. Geopolitical threats, problems, and unpredictabilities bordering profession plans added to international financial instability.
2. India’s Economic Performance
India’s genuine GDP development for FY25 is predicted at 6.4%, mostly driven by solid efficiencies in farming and solutions. Rural need has actually enhanced substantially, sustained by a document Kharif plant manufacturing.
However, making markets encountered difficulties because of weak international need. Macroeconomic security was preserved with disciplined monetary monitoring and a solid outside equilibrium. Money supply (M3) development regulated to 9.3% year-on-year since December 2024, and a greater cash multiplier shows enhanced liquidity in the economic climate.
3. Outlook for FY26
The study provides a well balanced expectation for FY26, with difficulties positioned by international unpredictabilities and prospective asset rate shocks.
Domestically, enhanced financial investment, enhanced customer self-confidence, and business wage development are anticipated to be essential motorists of development.
Positive patterns in country need and steady macroeconomic problems offer a desirable advantage.
Structural reforms and deregulation are highlighted as vital to increasing India’s international competition.
4. India’s Growth Drivers and the Need for Deregulation
The Survey highlights the demand for streamlining governing conformity to cultivate better financial liberty for people and companies, specifically for little business.
India need to concentrate on leveraging residential development motorists, offered the transforming international financial landscape.
5. China’s Dominance in Manufacturing and Energy Transition
The Survey recognizes China’s prominence in production, with its production result predicted to exceed the consolidated share of the following 10 nations. China’s lead in the international power change, especially in renewable resource, is additionally kept in mind.
“Acknowledging the elephant [and the dragon] in the area that will certainly have a bearing on the development estimates– basic changes in the international financial order integrated with China’s production expertise and tactical prominence,” the Survey said.
6. Performance of the Banking Sector
India’s banking sector has shown significant improvement in asset quality, with declining Gross Non-Performing Assets (GNPAs) and rising Capital Adequacy Ratio (CRAR).
The GNPA ratio of Scheduled Commercial Banks (SCBs) fell to a 12-year low of 2.6% as of September 2024.
7. Global Inflation Trends
Global food inflation is declining due to improving supply conditions, but some emerging economies, including India, continue to experience higher inflation.
8. Domestic Inflation in India
India’s headline inflation moderated in FY24 due to a significant reduction in core inflation and fuel price inflation.
Food inflation was primarily driven by specific food items like vegetables and pulses.
Extreme weather conditions, particularly in the case of vegetables and pulses, contributed to supply disruptions and price increases.
Uneven monsoon patterns caused price pressures, especially on tomatoes and onions, exacerbating inflationary trends.
9. Performance of the Service Sector
India’s services sector continues to expand, with emerging markets driving global growth.
India’s share in global services exports is steadily increasing, with significant contributions from public administration and IT services.
The Purchasing Managers’ Index (PMI) indicates ongoing expansion in the services sector.
10. Employment Trends
Significant improvements were observed in labor market indicators, including a decline in the unemployment rate and increased labor force participation.
There was a noticeable rise in self-employment, while regular salaried and casual work declined, indicating a shift towards flexible work arrangements.
Women’s participation in regular wage employment decreased, while self-employment and contributions to household enterprises saw a rise.
Agriculture remains the dominant employment sector, followed by services and industry.
11. Agriculture Sector
India’s agriculture sector showed a growth rate of 3.5% in Q2 of FY25, marking a recovery from previous quarters.
12. Education and Health
The Survey highlights the importance of integrating innovative solutions to improve education, such as new teaching methods, peer learning, and life skills training.
There is a focus on preventive healthcare, mental health, and leveraging technology to reduce healthcare costs.
The Ayushman Bharat scheme is expanding health coverage to vulnerable populations, including senior citizens.
The U-WIN portal is being used to digitize vaccination records and improve immunization efforts.
Awareness campaigns are being launched around the negative health impacts of Ultra-Processed Foods (UPFs).
13. Climate Change and Adaptation Measures
India’s vulnerability to climate change necessitates urgent adaptation measures. Adaptation in coastal regions includes initiatives such as mangrove conservation, sea wall construction, and dune planting. The Mangrove Initiative for Shoreline Habitats & Tangible Incomes (MISHTI) promotes mangrove restoration.
14. Financial Sector Risks
Despite resilience, the Indian financial sector faces potential risks, including high valuations in US stock markets, increased retail participation in Indian markets, and the rising influence of financial markets on policy decisions.
15. GIFT City Developments
The GIFT City is playing a crucial role in India’s financial sector by attracting global financial institutions and fostering a vibrant fintech ecosystem.
16. Insurance Sector Developments
India’s insurance sector is growing, driven by increased premium income and penetration, although challenges remain in terms of closing the coverage gap.
17. Pension Sector Developments
The pension sector has shown significant growth, particularly through the National Pension System (NPS) and Atal Pension Yojana (APY), but there is potential for further expansion, especially for informal sector workers.
18. Labor in the AI Era: Crisis or Catalyst?
The Survey addresses the potential impact of AI on employment, forecasting significant job displacement. However, it suggests that AI could also be a catalyst for new opportunities, especially in sectors driven by services.
19. Job Creation for the Future
To accommodate India’s growing workforce, the country needs to create 78.5 lakh new non-farm jobs annually until 2030-32.
Achieving 100% literacy, developing quality educational institutions, and building high-quality infrastructure are key to creating future-ready workers.
