Union Minister Smt Nirmala Sitharaman Presents Economic Survey 2024-25

Union Minister of Finance and Corporate Affairs, Smt. Nirmala Sitharaman presented the Economic Survey for FY 2024-25 in Parliament today, highlighting India’s remarkable economic resilience amidst global challenges and outlining the government’s vision for continued growth. The Survey forecasts a real GDP growth of 6.4% for FY25, marking a return to the country’s decadal average growth rate.
State of the Economy
India’s economy has shown commendable resilience in the face of global economic turbulence. Real GDP growth is projected at 6.4% for FY25, with the growth rate of real Gross Value Added (GVA) also matching the same figure. Despite the challenging global economic environment, India’s growth continues to outpace the global average, which stood at 3.3% in 2023. The Survey predicts a continued positive trajectory with FY26 GDP growth estimated to be between 6.3% and 6.8%.
Sitharaman emphasized the government’s focus on grassroots-level structural reforms and deregulation to bolster the medium-term growth potential. With ongoing geopolitical tensions and global trade risks, India remains committed to driving economic reforms that will enhance its global competitiveness.
Inflation and Fiscal Dynamics: Navigating a Stable Course
Retail inflation in India showed a decline from 5.4% in FY24 to 4.9% in the first nine months of FY25, reflecting effective fiscal management. The Reserve Bank of India (RBI) and IMF forecast that inflation will align with the target of 4% by FY26.
The country’s banking sector exhibited improvement, with non-performing assets (NPAs) falling to a 12-year low of 2.6% of total loans. Bank credit has grown steadily, supporting sustainable economic activity.
External Sector and Foreign Direct Investment: Rising Competitiveness
India’s external sector displayed significant strength, with overall exports growing by 6% in FY25. Notably, India ranks as the second-largest global exporter in ‘Telecommunications, Computer, & Information Services,’ holding 10.2% of the market share. Foreign Direct Investment (FDI) inflows surged by 17.9%, reaching USD 55.6 billion, marking a strong recovery. India’s forex reserves stood at a robust USD 640.3 billion, covering nearly 11 months of imports.
Infrastructure and Investment: Building a Future of Growth
The government’s capital expenditure (CAPEX) grew significantly from FY21 to FY24, with continued investments in infrastructure, transport, and renewable energy. The railway network saw a commissioning of 2,031 km between April and November 2024, alongside the introduction of 17 new Vande Bharat trains. The road network expanded with the construction of 5,853 km of National Highways in FY25.
Renewable energy capacity surged by 15.8% year-on-year, and the share of renewable energy in India’s installed capacity reached 47%. The government also focused on enhancing digital and rural connectivity, with 5G services rolled out across all states by October 2024.
Agriculture and Food Security: A Future-Focused Approach
Agriculture, contributing 16% to India’s GDP, continues to evolve with high-value sectors like horticulture, livestock, and fisheries becoming key drivers of growth. The government has increased the Minimum Support Price (MSP) for essential crops such as Arhar and Bajra, signaling strong support for farmers. Over 11 crore farmers have benefitted from initiatives like the Pradhan Mantri Garib Kalyan Anna Yojana, which ensures food security for vulnerable populations.
Industry and Services: A Progressive and Dynamic Sector
India’s industrial sector is projected to grow by 6.2% in FY25, driven by robust performance in electricity and construction. The government continues to focus on promoting Smart Manufacturing and Industry 4.0, alongside significant growth in the automotive and electronics sectors. India now manufactures 99% of smartphones domestically, significantly reducing dependence on imports.
The services sector’s contribution to GDP has risen, with a notable increase in exports, particularly in IT and computer services. India’s services export growth surged to 12.8% from April–November 2024, reflecting its growing global competitiveness.
Vision for 2047
Looking towards the future, Smt. Sitharaman outlined India’s ambitious vision to become a Viksit Bharat by 2047. The country aims to achieve an 8% average growth rate over the next few decades, which will require systematic deregulation, further liberalization, and continued infrastructure development. Through strategic reforms and sustained investments, India is poised to navigate global economic shifts and secure its position as a leading global economy.
The Economic Survey of FY 2024-25 presents a comprehensive and optimistic outlook for India’s future, driven by robust economic fundamentals, strategic reforms, and a commitment to innovation and growth.