Trade agreements improving policy certainty, to aid exports and capital flows: CEA Nageswaran

CEA V Anantha Nageswaran links trade progress with US and EU to stronger exports and capital flows as MoSPI releases new GDP series.

Chief Economic Advisor V Anantha Nageswaran said improved policy certainty resulting from successful trade agreements, including progress in India-US and India-EU negotiations, would support exports and capital flows.

He was addressing a press conference following the release of a new series of National Accounts Estimates by the Ministry of Statistics and Programme Implementation (MoSPI).

Nageswaran said fiscal consolidation remains on track, with the fiscal deficit estimated at 4.5% of GDP for 2025-26 (RE) under the new series, without compromising on capital expenditure.

MoSPI has released a new series of annual and quarterly National Accounts Estimates with 2022-23 as the base year, replacing the earlier 2011-12 base year series.

The Chief Economic Advisor said the Economic Survey’s growth projection for FY27 has been revised upward to 7–7.4% under the new GDP series.

He said the economy continues to maintain strong growth momentum supported by broad-based economic activity, adding that current indicators point to steady expansion despite global uncertainties.

Nageswaran said favourable supply-side conditions, including robust rabi sowing, comfortable foodgrain stocks and easing global commodity prices, are expected to keep inflation low and stable.

He said that in 2024-25, private sector investment in machinery and equipment has accelerated.

Unincorporated enterprises have also held up investment in machinery, he added.

Nageswaran said the lack of an AI story in Indian capital markets in 2025 was a handicap, and that this could be an advantage for capital flows in 2026.

He said that as per projections, India is on track to cross the $4 trillion GDP mark in 2026-27.