India's Economic Outlook for 2025-26

India’s Economic Survey 2024-25 forecasts a growth rate of 6.3% to 6.8% for the upcoming financial year, amidst a backdrop of economic moderation. The government is set to implement strategic reforms aimed at fostering industrial growth and innovation, with a focus on research and development, MSMEs, and capital goods.

Key Highlights from Budget 2025

Finance Minister Nirmala Sitharaman is poised to present the Union Budget on February 1, with expectations high for income tax relief and adjustments to income tax slabs and rates for salaried taxpayers. The budget aims to address the slowing growth rate while maintaining fiscal prudence.

Challenges and Opportunities

Despite the optimistic growth projections, the government faces challenges such as global uncertainties, domestic risks including weather disruptions, and rising commodity prices. Strategic investments in productivity and global competitiveness are seen as vital to overcoming these hurdles.

Projected GDP Growth and Fiscal Measures

Economic growth is expected to range between 6.3% and 6.8% for FY26, with the government aiming for an 8% growth in the long term to achieve its 'Viksit Bharat' aspirations by 2047. The fiscal deficit target is set at 4.5% of GDP for FY26, with a significant allocation towards capital expenditure and a projected increase in GST collections.