Economic Survey 2025 pegs FY26 growth at 6.3-6.8%

India's GDP estimate for FY26 by Economic Survey

India’s economy will grow at 6.3-6.8 percent in the financial year 2025-26, according to the the Economic Survey tabled by finance minister Nirmala Sitharaman on January 31.

The government’s estimate range is in line with the International Monetary Fund’s 6.5 percent but lower than the 6.7 percent projected by the World Bank.

The Economic Survey is released a day before the presentation of the Union Budget where all eyes will be on the finance minister to spur consumption and provide support to growth while keeping the fiscal deficit in check.

The Indian economy will likely grow 6.4 percent in 2024-25, according to the first advance estimates released by the government on January 7.

The estimate was lower than the previous economic survey’s estimate of 6.5-7 percent growth and the Reserve Bank of India’s revised projection of 6.6 percent.

A disappointing manufacturing performance and a capex slowdown pushed growth lower in the second quarter. Real GDP growth slumped to a near two-year low of 6.5 percent in Q2FY25.

In the first half of the year, the economy grew 6 percent and will have to log 6.8 percent growth in the second half to reach the government’s estimate.

Results of FMCG majors for the third quarter, released earlier this week, indicated that urban consumption is yet to pick up meaningfully. This, coupled with slowing credit growth, points to slow consumption in the quarter.

India's business activity slowed to a 14-month low in January, with services being the leading cause of decline.