India's Chief Economic Adviser V. Anantha Nageswaran
Credit: Reuters Photo
New Delhi: Days ahead of the presentation of the Union Budget the central government on Thursday claimed that India will maintain its position as the fastest growing major economies with medium-term growth potential accelerating to 7% from 6.5% three years back.
As per the Economic Survey 2025-26 tabled in Parliament by Union Finance Minister Nirmala Sitharaman, India’s gross domestic product (GDP) is expected to grow in the range of 6.8 to 7.2% in the financial year 2026-27.
Though the midpoint projected growth of 7% for the next financial year beginning April 2026 is lower than the estimated growth of 7.4% in the current fiscal, the Survey projection is higher.
For the current financial year the last year’s Economic Survey had pegged the GDP growth in the range of 6.3 to 6.8%, with a midpoint of around 6.5%. In the first half of the year the growth stood at 8% and as per the first advance estimate released by the National Statistics Office (NSO) the full year growth is likely to be 7.4%. With around 7% estimated growth in 2026-27, India is set to maintain its position as the fastest-growing major economy for the fourth consecutive year.
Chief Economic Adviser V. Anantha Nageswaran said that higher than anticipated growth in the current financial year is because of the sustained domestic reforms and public investment.
“India is indeed an oasis of macro stability in an otherwise turbulent world. Numbers speak for themselves,” Nageswaran told reporters.
“If we are able to achieve manufacturing and export competitiveness and pursue further process reforms in the areas of land and cost subsidisation and bring down the cost of manufacturing, the potential 7% growth can even rise to 7.5% and 8% in the next few years," he said.
The Economic Survey, prepared by the Department of Economic Affairs under the supervision of the Chief Economic Adviser, offers the central government’s official assessment of the state of the economy and an outlook for the coming fiscal year.
The report underlined that in 2025-26 heightened uncertainty in global trade and the imposition of high and penal tariffs by the United States created stress for manufacturers, particularly exporters, and affected business confidence.
The government responded by using this crisis as an opportunity to push through key measures such as GST rationalisation, faster progress on deregulation, and further simplification of compliance requirements across sectors, it said.
“The cumulative impact of policy reforms over recent years appears to have lifted the economy’s medium-term growth potential closer to 7%. With domestic drivers playing a dominant role and macroeconomic stability well anchored, the balance of risks around growth remains broadly even,” the report said.
The annual Survey report, released ahead of the presentation of the Union Budget, noted that demand-led growth in the economy has unfolded alongside a marked easing of inflation, which has improved real purchasing power and supported consumption.
“The Economic Survey tabled today presents a comprehensive picture of India’s Reform Express, reflecting steady progress in a challenging global environment,” Prime Minister Narendra Modi said in a post on X.
Modi added that the Survey underscores the importance of inclusive development, with focused attention on farmers, MSMEs, youth employment and social welfare.
“Our macroeconomic fundamentals are stronger than ever. We have successfully navigated global headwinds to place India on a high-growth trajectory, improving our potential GDP growth to 7%,” Finance Minister Sitharaman wrote on X.