Economic Survey projects India’s growth at 6.8–7.2%

New Delhi: India’s economy is expected to grow between 6.8 percent and 7.2 percent in 2026–27, maintaining its position as one of the fastest-growing major economies, according to the Economic Survey tabled in Parliament on Thursday by Union Finance Minister Nirmala Sitharaman.

The Survey said the domestic economy remains on a stable footing, though slower growth among key trading partners and tariff-related disruptions could weigh on exports and investor sentiment.

The Survey noted that economic momentum has been sustained, with GDP growth remaining strong in the first quarter and improving further in subsequent quarters. It pegged GDP growth for 2025–26 at 7.4 percent, reflecting resilience in domestic demand, continued public investment, and the impact of structural reforms.

While the economic outlook remains favourable, the Survey cautioned that a global slowdown could lead to weaker export growth, even as free trade agreements (FTAs) are expanding market access for India’s manufactured exports. It emphasised that domestic reforms and sustained public capital expenditure would continue to act as key drivers of growth in the medium term.

Highlighting macroeconomic stability in the post-Covid period, the Survey pointed to supportive monetary conditions, noting that the central bank had cut interest rates aggressively and eased liquidity, aiding recovery and investment.

Inflation management and financial sector stability were also cited as factors underpinning growth.

On the fiscal front, the government’s consolidation path remained on track. The Survey said the Centre achieved a fiscal deficit of 4.8 per cent of GDP, better than the budgeted 4.9%, and announced a target of 4.4 per cent for FY26. This fulfils the commitment made in 2021 to reduce the union fiscal deficit by more than half from 9.2 per cent in FY21.

The Survey also took note of significant tax relief announced for households in the February Budget for FY26, aimed at boosting consumption and supporting growth.

Overall, the Economic Survey concluded that India’s economy retains momentum, and growth is likely to remain robust in FY 2026–27, even as policymakers remain watchful of evolving global risks.