• India’s GDP expected to grow between 6.3 and 6.8 per cent in FY26
• Real GDP estimated at 6.4% in FY25, close to its decadal average
• Real GVA estimated to grow by 6.4 per cent in FY25

Driven by robust post-COVID-19 recovery and increased formalisation, labour market indicators in the country have improved substantially in the past few years. According to the Periodic Labour Force Survey, the unemployment rate has dropped significantly, and labour force participation and the worker-population ratio have improved considerably.

According to the Economic Survey, the school education system in India serves 24.8 crore students across 14.72 lakh schools with 98 lakh teachers.

The government schools make up 69% of the total, enrolling 50% of students and employing 51% of teachers. Private schools account for 22.5%, enrolling 32.6% of students and employing 38% of teachers.

India’s services sector, according to the Economic Survey, has been the steadiest contributor to the gross value added (GVA) in the economy. Its contribution to the total GVA at current prices has risen from 50.6% in FY14 to about 55% in FY25.

Retail inflation in India has reduced from 5.4% in the financial year 2024-24 (FY24) to 4.9% in FY25 (April-December), helped by various government initiatives and monetary policy measures.

A total of 1.18 crore houses have been sanctioned to 'The Pradhan Mantri Awas Yojana – Urban (PMAY-U)' beneficiaries , the Economic Survey 2024-25 said on Friday.

"As of November 25, 2024, a total of 1.18 crore houses have been sanctioned, with 1.14 crore grounded and over 89 lakh completed," the pre-budget report for the 2024-25 fiscal said.

“The faster economic growth that India needs is only possible if the union and state governments continue to implement reforms that allow small and medium enterprises to operate efficiently and compete cost-effectively”, the Economic Survey 2024-25 said.

The Survey found that governments can reduce excessive regulatory burdens, helping businesses become more efficient, reduce costs, and unlock new growth opportunities.

"Regulations increase the cost of all operational decisions in firms," the Economic Survey added.

The Economic Survey on Friday cited studies showing that working more than 60 hours per week could lead to adverse health effects.

The survey stated that spending long hours at one's desk is detrimental to mental well-being, and individuals who spend 12 or more hours (per day) at a desk have distressed or struggling levels of mental well-being.

The Economic Survey said that to achieve its target of becoming a 'developed India by 2047,' India needs to achieve an average growth rate of around 8% at constant prices for about a decade or two.

"While the desirability of this growth rate is unquestionable, it's important to recognise that the global environment—political and economic—will influence India's growth outcomes," the pre-Budget document said.

• Food inflation, measured by the CFPI, faced pressures in FY25 (April-December), primarily driven by a few food items such as vegetables and pulses.
• Vegetables and pulses together hold a total weightage of 8.42% in the CPI basket.
• Vegetables and pulses contribution to the overall inflation stood at 32.3 per cent in FY25 (April to December).
• The average headline inflation would be 3.2% when the vegetables and pulses inflation rate were excluded, 1.7% lower than the actual headline inflation.

The 'agriculture and allied activities' sector contributed around 16% of the country’s GDP for FY24 (PE) at current prices.

• High-value sectors like horticulture, livestock, and fisheries have become key drivers of overall agricultural growth.
• Kharif foodgrain production for 2024 is expected to reach 1647.05 Lakh Metric Tonnes (LMT), an increase of 89.37 LMT from the previous year.
• For the fiscal year 2024-25, the MSP for Arhar and Bajra has been increased by 59% and 77% over the weighted average cost of production, respectively.

The Economic Survey underscores that as of March 2024, the country has 7.75 crore operational Kisan Credit Card (KCC) accounts with a loan outstanding of ₹9.81 lakh crore.

More than 1 lakh crore claims have been processed under the modified interest subvention scheme, from which 5.9 crore farmers benefitted.

"Elevated valuations and optimistic market sentiments in the US raise the likelihood of a meaningful market correction in 2025. Should such a correction occur, it could have a cascading effect on India, especially given the increased participation of young, relatively new retail investors. Many of these investors that have entered the market post-pandemic have never witnessed a significant and prolonged market correction. Hence, if one were to occur, its impact on sentiment and spending may be non-trivial," the pre-Budget document said.

The mutual fund segment currently has over 10 crore Systematic Investment Plan (SIP) accounts, with cumulative SIP inflows of ₹10.9 lakh crore since inception.

Monthly average gross SIP flows have more than doubled in the last three years, from ₹0.10 lakh crore in FY22 to ₹0.23 lakh crore in FY25.

"Aided by these sustained inflows, mutual fund ownership in Indian listed companies has risen to a fresh all-time high of 9.5% in the quarter ending September 2024, from 8.7% in FY24," the survey said.

Qualified Institutional Players (QIPs) emerged as the preferred equity fundraising mechanism for corporates during FY25, with an 11.4% share of total capital raised.

Resource mobilisation via rights issues remains buoyant, with ₹16,881 crore raised during April to December 2024 against ₹6,538 crore in the corresponding period of the previous year

The total resource mobilisation from primary markets (equity and debt) stands at ₹11.1 lakh crore from April to December 2024, which is 5% more than the amount mobilised during the entire FY24.

"This also amounts to 25.6 per cent of gross fixed capital formation of private and public corporations during FY24," the survey said.

India's Chief Economic Advisor (CEA) V Anantha Nageswaran said at a press conference that the country will have to rely on domestic growth drivers.

Stating that globalisation may be a thing of the past, he said that nations recalibrate towards domestic priorities.

The primary markets continued to witness heightened listing activities andv investor enthusiasm in FY25, notwithstanding the market volatility and geopolitical uncertainties.

"As per the E&Y Global IPO trends, Indian stock exchanges provide conducive market conditions for foreign conglomerates to list their local subsidiaries, thereby offering a good opportunity for unlocking value. India's share in global IPO listings surged to 30% in 2024, up from 17% in 2023, making it the leading contributor of primary resource mobilisation globally," the document said.

While stating use cases of AI and Machine Learning (ML) applications by banks, the Economic Survey stressed that AI in the banking system entails a few risks.

"The black-box nature of AI systems can make it difficult to assess the system's reliability or contest its decisions. This lack of transparency can lead to trust concerns and challenges in validating the fairness and accuracy of AI decisions, making it challenging to audit or interpret the algorithms that drive the decisions. Accountability risks include difficulty in tracing decisions to their source and establishing liability," the report said.

Other risks include

• Human resources, such as inadequate human oversight, over-reliance on AI, and loss of human expertise.
• Cyber risks
• Malicious usages like synthetic identity frauds, rogue trading, and market manipulation.
• System related risks such as inability to intervene and market correlations.
• Third-party dependencies and service provider concentration.

India’s monetary and financial sectors have performed well in the first nine months of the current fiscal year, according to the Economic Survey.

"Bank credit has grown at a steady rate in the current financial year, with credit growth converging towards deposit growth. There has been a consistent improvement in the profitability of scheduled commercial banks (SCBs) as reflected in a fall in gross non-performing assets (GNPAs) accompanied by a rise in the capital-to-risk weighted asset ratio (CRAR)," the report said.

"The formal sector in India has seen significant growth, with net Employees’ Provident Fund Organisation (EPFO) subscriptions more than doubling from 61 lakh in FY19 to 131 lakh in FY24. In April -November 2024, net additions reached 95.6 lakh, driven largely by youth. Workers aged 18-25 years contributed to 47% of the net payroll additions," the Economic Survey said.

This indicates a growing trend towards formal employment, which enhances workers' access to social security and stability.

The pre-Budget document said that the country's banking and financial sector remains stable and well-capitalised, and is catering to the financing needs of the economy.

"While credit disbursal by scheduled commercial banks (SCBs) is growing in double-digits, there has been a moderation in the growth in recent months. This is on the back of a high base and also due to regulatory tightening in sectors where high growth was observed, the Economic Survey said.

According to Economic Survey, the slowdown in investment activity is likely temporary. The document said that green shoots in capital formation are visible.

"Union government capex is up 8.2% in July – November 2024 and is expected to pick up further pace," the report said.

The industrial sector grew by 6% in the first half of FY25. The first quarter saw a strong growth of 8.3%, but growth moderated in Q2 due to three key factors;

• Manufacturing exports slowed significantly due to weak demand from destination countries, and aggressive trade and industrial policies in major trading nations.
• Above-average monsoon had mixed effects - while it replenished reservoirs and supported agriculture, it also disrupted sectors like mining, construction, and, to some extent, manufacturing.
• The variation in the timing of festivities between September and October in the previous and current years led to a modest growth slowdown in Q2 FY25.

The Economic Survey noted that agriculture growth remained steady in the first half of the financial year 2024-25, with the second quarter recording a growth of 3.5%, reflecting an improvement over the previous four quarters.

"As per the first advance estimates released by the National Statistical Office, Ministry of Statistics & Programme Implementation (MoSPI), the real gross domestic product (GDP) growth for FY25 is estimated to be 6.4 per cent. From the angle of aggregate demand in the economy, private final consumption expenditure at constant prices is estimated to grow by 7.3 per cent, driven by a rebound in rural demand. PFCE as a share of GDP (at current prices) is estimated to increase from 60.3 per cent in FY24 to 61.8 per cent in FY25. This share is the highest since FY03. Gross fixed capital formation (GFCF) (at constant prices) is estimated to grow by 6.4 per cent," the Economic Survey said.

According to Economic Survey, in the global context, India displayed steady economic growth.

"As per the first advance estimates of national accounts, India’s real GDP is estimated to grow by 6.4 per cent in FY25. Growth in the first half of FY25 was supported by agriculture and services, with rural demand improving on the back of record Kharif production and favourable agricultural conditions. The manufacturing sector faced pressures due to weak global demand and domestic seasonal conditions. Private consumption remained stable, reflecting steady domestic demand. Fiscal discipline and strong external balance supported by a services trade surplus and healthy remittance growth contributed to macroeconomic stability. Together, these factors provided a solid foundation for sustained growth amid external uncertainties.," the document said.

According to the Economic Survey, the government focused on infrastructure development in the last five years. The capex on key infrastructure sectors grew at the rate of 38.8% from FY20 to FY24. In the current fiscal, after the electoral process, capital expenditure picked up momentum between July and November 2024, as per the Economic Survey.

NIFTY50 surged 1.1% to 23,504, while SENSEX gained 0.93% to 77,467 as Finance Minister Nirmala Sitharaman tabled Economic Survey 2025 in Parliament on Friday.

As per the Economic Survey, the inflation softened to 4.9% in April-December period of the financial year 2024-25.

According to the Economic Survey 2025, the near-term global growth is likely to be a bit lower than the trend level.

The global commodity prices are also expected to decrease, potentially easing core and food inflation.

Finance Minister Nirmala Sitharaman has tabled the Economic Survey 2025 in Rajya Sabha.

Lok Sabha, the lower House of Parliament, adjourned till 11 am on Saturday, February 1, 2025.

The Economic Survey projects India's gross domestic product (GDP) growth for the financial year 2025-26 between 6.3% and 6.8%.

FM Nirmala Sitharaman has tabled the Economic Survey 2025 in Lok Sabha. The presentation will begin shortly.

Madan Sabnavis, Chief Economist of Bank of Baroda, hopes the forthcoming budget will prioritise reducing the fiscal deficit to around 4.3% to 4.4% of GDP for the next fiscal year, a 0.5% decrease.

"As we look forward to the Union Budget of India 2025, Insta Food is optimistic about the potential for growth within the ready-to-cook food sector. We hope the budget will focus on policies that encourage innovation in food processing, streamline supply chains, and boost local sourcing," Piyush Sheta, CEO, Insta Food, said, adding, "Investments in digital infrastructure and technology will enable us to better serve our customers and expand our reach. Additionally, incentives for sustainable packaging and environmentally friendly practices will be key to supporting our commitment to both quality and sustainability. With these initiatives, Insta Food is poised to play a leading role in shaping India’s evolving food landscape."

The Economic Survey is expected to project a 6.3% to 6.8% GDP growth for the financial year 2025-26, sources told news agency PTI.

The Survey 2024-25, authored by Chief Economic Advisor of India V Anantha Nageshwaran and his team, will be presented in Parliament this afternoon.

"Rooftop solar systems are being installed at a cost of ₹75,000 crore under the PM Surya Ghar Free Electricity Scheme," President Droupadi Murmu said.

"My government has ensured Dalits, STs and OBCs become biggest beneficiaries of our initiatives and schemes," President Murmu said.

Addressing Parliament, President Droupadi Murmu said, "Reform, perform and transform have become strong pillars of India's governance model."

President Droupadi Murmu said, "The government has taken historic steps to protect the country's borders and ensure internal security."

"PM Suraj Yojana has been expanded to provide easy loans to backward classes of society and sanitation workers," President Murmu said.

"For a weather-ready and climate-smart India, my government has started 'Mission Mausam' at a cost of ₹2,000 crore, which will also benefit our farmers," President Droupadi Murmu said.

President Droupadi Murmu noted that India's aviation sector is progressing rapidly. She said that airline companies in the country have placed orders for 1700 new aircraft.

• India's metro network has now crossed the one thousand kilometre milestone.
• The Udhampur-Srinagar-Baramulla rail link project has been completed and now the country will be connected by railway line from Kashmir to Kanyakumari.

President Droupadi Murmu said, "Today, several Vande Bharat, Amrit Bharat, and Namo Bharat trains are being operated. In the last six months, 17 new Vande Bharat trains and one Namo train have been introduced. The government is working rapidly in the direction of One Nation, One Election and Waqf (Amendment) Bill. In the last one decade, my government has given new energy to the journey of 'Viksit Bharat'."

"My Government has used digital technology as a tool for social justice and equality. Digital payments are not limited to some people or some groups." the President of India, Droupadi Murmu, said.

Addressing Parliament, President Droupadi Murmu said, "My government has taken several important steps to promote ease of doing business."

"My government believes in empowering country under leadership of women," President Droupadi Murmu said on Friday, January 31.