Union Finance Minister Nirmala Sitharaman presented the Economic Survey on July 22, revealing that India’s real GDP is projected to grow between 6.5% and 7% for the fiscal year 2024-25. This forecast aligns with the International Monetary Fund’s estimate of 7% and reflects a balanced outlook, considering both optimistic and cautious economic scenarios. The survey, presented a day before the Budget announcement, indicates that while market expectations are higher, the projection conservatively accounts for potential risks.
The Economic Survey outlines several key highlights, including the RBI and IMF’s predictions that India’s consumer price inflation will align with the inflation target by FY26, assuming normal monsoon conditions and no additional external shocks. The survey also projects a 3.7% increase in remittances to USD 124 billion in 2024 and a 4% increase to USD 129 billion in 2025. Additionally, it highlights the importance of transitioning towards a balanced diet to address the 54% disease burden from unhealthy diets and suggests that increased FDI inflows from China could boost India’s global supply chain participation and exports.
Other significant points include the potential impact of Artificial Intelligence on workers, the resilience of India’s capital markets amid global shocks, and the transformation of the financial sector. The survey notes improvements in tax compliance, expenditure restraint, and digitization contributing to balanced fiscal management. It also highlights the stellar performance of India’s banking and financial sectors in FY24 and the maintenance of retail inflation at 5.4%, the lowest since the pandemic, driven by decreases in core inflation for goods and services.
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