The Economic Survey 2025-26 was released by the Ministry of Finance ahead of the Union Budget, projecting India's GDP growth at 7.4% for FY 2025-26 — higher than the 6.5% recorded in FY 2024-25 — reaffirming India's status as the world's fastest-growing major economy for the fourth consecutive year. Real GDP growth for FY 2026-27 was projected in the range of 6.8% to 7.2%, with India's medium-term growth potential estimated at 7%. The Survey noted that growth in FY26 was largely driven by domestic demand, with the share of private final consumption expenditure rising to 61.5% — the highest since 2011-12. The industrial sector grew by 7% in the first half of FY26, while manufacturing recovered strongly to 9% growth in Q2 of FY26. The Survey flagged that India concluded three high-profile trade agreements — India-UK CETA, India-Oman CEPA, and India-New Zealand FTA — to diversify trade relationships amid US tariff pressures on Indian MSMEs. Direct tax exemptions for the middle-income class were announced to address consumer stress. GST slab rationalisation was cited as a key demand-boosting reform. Rajasthan's economy is directly impacted by the Economic Survey's findings — the state's key sectors of tourism, mining (stone, marble, non-ferrous metals), agriculture, and MSMEs benefit from central fiscal policies. The Survey's emphasis on rural consumption and agricultural income growth is particularly relevant for Rajasthan, which has one of the largest rural populations among Indian states.
India's Economic Survey 2025-26 Released Ahead of Union Budget: GDP Growth Estimated at 7.4% for FY26, Driven by Domestic Consumption and Manufacturing Recovery
The Economic Survey 2025-26 was released by the Ministry of Finance ahead of the Union Budget, projecting India's GDP growth at 7.4% for FY 2025-26 — higher than the 6.5% recorded in FY 2024-25 — reaffirming India's status as the world's fastest-growing major economy for the fourth consecutive year. Real GDP growth for FY 2026-27 was projected in the range of 6.8% to 7.2%, with India's medium-term growth potential estimated at 7%. The Survey noted that growth in FY26 was largely driven by domestic demand, with the share of private final consumption expenditure rising to 61.5% — the highest since 2011-12. The industrial sector grew by 7% in the first half of FY26, while manufacturing recovered strongly to 9% growth in Q2 of FY26. The Survey flagged that India concluded three high-profile trade agreements — India-UK CETA, India-Oman CEPA, and India-New Zealand FTA — to diversify trade relationships amid US tariff pressures on Indian MSMEs. Direct tax exemptions for the middle-income class were announced to address consumer stress. GST slab rationalisation was cited as a key demand-boosting reform. Rajasthan's economy is directly impacted by the Economic Survey's findings — the state's key sectors of tourism, mining (stone, marble, non-ferrous metals), agriculture, and MSMEs benefit from central fiscal policies. The Survey's emphasis on rural consumption and agricultural income growth is particularly relevant for Rajasthan, which has one of the largest rural populations among Indian states.
Key facts
- Economic Survey 2025-26 projected India's GDP growth at 7.4% for FY26 — world's fastest-growing major economy.
- Private final consumption expenditure rose to 61.5% — highest since 2011-12.
- Manufacturing recovered strongly to 9% growth in Q2 of FY26.
- India concluded three trade agreements: India-UK CETA, India-Oman CEPA and India-New Zealand FTA.
- GST slab rationalisation and direct tax exemptions for middle-income class were key reforms cited.
- Rajasthan's tourism, mining, agriculture and MSMEs directly benefit from central fiscal policies.
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According to the Economic Survey 2025-26, what is India's projected GDP growth for FY 2025-26?
The article states the Economic Survey 2025-26 projects India's GDP growth at 7.4% for FY 2025-26, higher than the 6.5% recorded in FY 2024-25, reaffirming India's status as the fastest-growing major economy.
Source: PIB / PRS India / IBEF / Deloitte India / ClearTax
Frequently asked questions
What GDP growth rate did the Economic Survey 2025-26 project for India in FY26 and what drove it?
The Economic Survey 2025-26 projected India's GDP growth at 7.4% for FY 2025-26, up from 6.5% in FY 2024-25. The growth was driven primarily by domestic consumption — with private final consumption expenditure rising to 61.5% of GDP (highest since 2011-12) — and a strong recovery in the manufacturing sector.
What were India's three major trade agreements mentioned in Economic Survey 2025-26?
The Economic Survey 2025-26 highlighted three significant trade agreements concluded by India: the India-UK Comprehensive Economic and Trade Agreement (CETA), the India-Oman Comprehensive Economic Partnership Agreement (CEPA), and the India-New Zealand Free Trade Agreement (FTA). These agreements are expected to expand India's export markets and attract foreign investment.
What is the significance of the private final consumption expenditure figure cited in Economic Survey 2025-26?
Private final consumption expenditure rose to 61.5% of GDP in FY26 — the highest proportion since 2011-12 — indicating a robust recovery in household spending. This figure is significant as domestic consumption is the largest driver of India's GDP, and its resurgence signals broad-based economic recovery across income groups.
What growth rate did India's manufacturing sector record in Q2 of FY26 as per the Economic Survey?
India's manufacturing sector recovered strongly to record 9% growth in Q2 of FY 2025-26. This rebound followed a period of moderation and was attributed to increased domestic demand, export growth, and policy measures under the Production Linked Incentive (PLI) scheme supporting key manufacturing industries.
How does the Economic Survey 2025-26 relate to the Union Budget and what is Rajasthan's stake in central fiscal policies?
The Economic Survey is presented by the Chief Economic Adviser on behalf of the Finance Ministry on the day before the Union Budget, providing an independent assessment of India's economic performance and outlook. For Rajasthan, central fiscal policies directly impact the state's tourism, mining, agriculture, and MSME sectors, which are key pillars of the state economy.
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