Fri Jan 31 15:00:00 IST 2025: ## India’s Economic Growth Projected to Slow to 6.3-6.8% in FY26: Economic Survey

**New Delhi** – India’s economy is expected to slow down in the upcoming fiscal year, according to the Economic Survey 2024-25 presented to Parliament today by Finance Minister Nirmala Sitharaman. The survey projects a growth rate of between 6.3% and 6.8% for FY26 (2025-26), marking the lowest rate since the COVID-19 impacted FY21.

While acknowledging robust domestic fundamentals including a strong external account and stable private consumption, the survey points to global uncertainties and geopolitical headwinds as potential dampeners on growth. The projected growth is significantly lower than the 8.2% recorded in FY24, 7% in FY23, and 9.7% in FY22.

The survey highlights several key factors:

* **Inflation:** Food inflation is expected to ease in the final quarter of FY25 due to seasonal factors. However, geopolitical tensions remain a risk.
* **Global Competitiveness:** The survey emphasizes the need for further structural reforms and deregulation to boost India’s global competitiveness.
* **Technological Risks:** The report warns of potential misuse of Artificial Intelligence without a proper governance framework.
* **Financial Markets:** Concerns were raised about the impact of a potential market correction on India, particularly given increased retail investor participation. The survey also identified challenges in boosting liquidity in the corporate bond market.

The survey’s projection precedes the Union Budget 2025-26, which Finance Minister Sitharaman will present on Saturday. The government will likely use the budget to address the challenges highlighted in the survey and maintain economic momentum despite global headwinds.

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