Economic Survey 2025-26 Projects 6.8–7.2% GDP Growth for India in FY27
The Economic Survey 2025-26 has projected India’s economy to grow between 6.8% and 7.2% in FY27, supported by strong macroeconomic fundamentals, regulatory reforms, and a renewed focus on private sector-led investment. The survey outlines a strategic roadmap for navigating global trade uncertainties while sustaining long-term growth momentum.
For FY26, India’s growth is estimated at 7.4%, according to the first advance estimates released earlier this month. Global institutions have broadly aligned with this outlook. The International Monetary Fund has projected India’s growth at 7.3% in the current fiscal year, while the World Bank has estimated it at 7.2%. For FY27, the two institutions expect growth of 6.4% and 6.5%, respectively.
The Ministry of Statistics and Programme Implementation is scheduled to release the second advance estimate for FY26 on 27 February, based on a revised GDP series that updates the base year from 2011-12 to 2022-23. While the rebasing will alter headline GDP levels, economists expect growth rates to remain largely unchanged.
Inflation Remains Below RBI Target
Inflation trends remained subdued during the year. Last month, the Reserve Bank of India estimated CPI inflation at 2%, well below its medium-term target of 4%, largely due to easing food prices. The central bank projected inflation at 0.6% for the December quarter and 2.9% for the March quarter.
Moderate inflation has, however, weighed on nominal GDP growth, which was estimated at 8% for FY26 in the first advance estimates—lower than the 10.1% assumption in the Union Budget.
Policy Signals and Private Investment Push
Prepared by the Department of Economic Affairs, the Economic Survey serves as the government’s annual assessment of economic conditions and policy direction. Over the years, it has often proposed forward-looking ideas aimed at shaping long-term reforms.
The latest survey, tabled in Parliament by Finance Minister Nirmala Sitharaman, once again calls on the private sector to scale up investment and accelerate job creation, particularly at a time when technology and generative artificial intelligence are reshaping labour markets.
The survey also highlighted global risks linked to rapid AI-driven investments. Earlier this month, the IMF warned of a possible re-evaluation of productivity expectations around AI, cautioning that an abrupt correction could impact financial markets and household wealth.
Infrastructure and Capital Expenditure
The survey stressed the need for greater private participation in infrastructure development, supported by improved data on assets and investments, rather than relying predominantly on public spending. This approach, it said, would be critical as India works toward its goal of becoming a developed nation by 2047.
India’s infrastructure push has already resulted in a sharp increase in government capital expenditure while maintaining fiscal consolidation. Central government capex has risen from ₹5.93 trillion in FY22 to ₹11.21 trillion in the FY26 Budget Estimates. As a share of GDP, capex support has increased from 2.5% in FY22 to 3.1% in FY26, reflecting sustained investment in growth-enabling sectors.
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