Economic Survey 2025 Highlights: Deregulation key to India’s growth, push for EoDB 2.0 gains momentum

Under ease of doing business for exporters, an important area of focus is enhancing logistics efficiency to strengthen India’s manufacturing and export capabilities. The development of logistics hubs, investments in infrastructure, and policy reforms to improve supply chain efficiency are measures in this direction, according to the Economic Survey 2024-25.

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Citing rising protectionism and increased geo-political uncertainties as growing challenges, the Economic Survey suggested framing of a new strategic trade roadmap focussing on improved export competitiveness.

“The evolving global trade dynamics, marked by gradual shifts towards greater protectionism, require assessing the situation and developing a forward looking strategic trade roadmap. By adapting to these trends and leveraging its strengths, India can accelerate its growth and enhance its presence in global trade,” the survey tabled in Parliament on January 31 noted.

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The Economic Survey 2024-25 has said retail onion prices witnessed a significant surge in 2024, surpassing ₹60 per kg in October-November. The Survey highlights that onion prices remain elevated, reflecting growing concerns over inflationary pressures, supply chain disruptions, and increased demand.

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To promote domestic tourism, India has approved interest-free loans to 40 projects across 23 states for 50 years worth ₹3,295.8 crore under the special assistance to states for capital investment, said the Economic Survey FY2024-25.

As per the Economic Survey FY25, which was tabled in Parliament on Friday, the initiative aims to create “iconic tourist centres of global standards” by supporting their development and marketing

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Given India’s size and limited land availability, public transportation emerges as an efficient alternative for sustainable energy transition, Chief Economic Advisor V Anantha Nageswaran stated in the Economic Survey 2024-25 preface. He called for national-level policies and local initiatives that promote and facilitate use of public transport, going beyond the traditional focus on tail-pipe emissions from private vehicles.

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The floriculture industry has grown into a high-performing sector, earning status as a “sunrise industry” with a 100 per cent export orientation, The Economic Survey 2024-25 said.

Driven by a growing global demand for flowers, floriculture has evolved into a key commercial venture within agriculture. Commercial floriculture is particularly lucrative, offering higher returns per unit area than many traditional field crops, it observed.

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Criticising the developed countries for failing to meet their “commitments” at the COP 29, the Economic Survey on Friday opined that COP 30 could witness an impact on climate targets due to a “funding shortfall”.

It also highlighted that the lack of commitment and insufficient delivery of the means of implementation, as mandated in the Paris Agreement, will make the low-carbon transition in developing countries more challenging.

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The Economic Survey 2024-25 has proposed to reduce the regulatory compliance burden discouraging women’s participation in factory work, as the top 10 most-populous states impose 139 prohibitions on engaging women in specific processes.

The states justify the prohibitions owing to the dangerous nature of the processes, the Economic Survey stated in Chapter 5, titled ‘Medium Term Outlook: Deregulation Drives Growth’. However, the “inter-State comparison and scientific literature indicate that these prohibitions are enforced without evidence of special health risks to women workers,” it observed.

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Artificial intelligence (AI) should be able to help rather than replace jobs, the Economic Survey 2024-25 said on Friday. It said that some of the fears about AI being hugely disruptive to employment might be “misplaced”. 

It said that for India, a services-driven economy with a youthful and adaptable workforce, the adoption of AI offers the potential to support economic growth and improve labour market outcomes.

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The EU’s Carbon Border Adjustment Mechanism and EU-Deforestation Regulation (EUDR) are non-tariff barriers in the garb of climate protection measures and can potentially hit an estimated $9.5 billion of Indian exports to the bloc, the Economic Survey has said.

“..it is hard to shake off the conclusion that both CBAM and EUDR are trade protection measures garbed in the language of climate and environment. The game and the end goals are the same, but the tactics keep changing. Labour standards, gender, democracy, emissions and deforestation, the innovative list will keep evolving with time,” the Eco Survey noted.

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The Economic Survey has projected the gold prices to decline on the back of expected fall in inflation and silver prices to gain in the coming fiscal on back of industrial demand. 

Based on the World Bank’s Commodity Markets Outlook released last October, the Economic Survey expects commodity prices to decrease by 5 per cent in 2025 and 2 per cent in 2026.

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The India data centre market is expected to grow to $11.6 billion by 2032, growing annually at 10.98 per cent, the Economic Survey FY25 said, noting that the segment was seeing significant growth “fuelled by the expansion of infrastructure and a rising demand for digital services.”

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Criticising the developed countries for failing to meet their “commitments” at the COP 29, the Economic Survey on Friday opined that COP 30 could witness an impact on climate targets due to a “funding shortfall”.

It also highlighted that the lack of commitment and insufficient delivery of the means of implementation, as mandated in the Paris Agreement, will make the low-carbon transition in developing countries more challenging.

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At a time when insurance penetration is showing a downward trend, insurers can tap into new customer segments and stimulate growth by targeting tier 2 and 3 cities to increase penetration, according to the Economic Survey. 

The total premium grew by 7.7 per cent in FY24, reaching Rs 11.2 lakh crore, despite a slight decline in insurance penetration from 4 per cent in FY23 to 3.7 per cent in FY24. 

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Tamil Nadu’s strategic initiatives to foster footwear manufacturing growth and the State’s Illam Thedi Kalvi (Education at Doorstep): Innovation in public education were two major highlights of the State in the Economic Survey 2024-25.

Tamil Nadu (TN) is a leader in the traditional leather sector and is now championing the growth of non-leather footwear. The State contributes 38 per cent of India’s footwear and leather products output, and about 47 per cent India’s total leather exports. The sector generates more than 2 lakh employment.

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The Economic Survey 2024-25 has stressed the need for explicit guidelines on vertical gardens to support the implementation of energy-efficient and environmentally sustainable building practices in the country.

The Survey said rapid urbanisation has intensified environmental challenges, including the urban heat island effect, increasing carbon emissions, and heightened air pollution.

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Export-oriented agriculture, a focus on technology, and collective efforts have helped Maharashtra emerge as a major contributor to the country’s grape production, and as a major export commodity.

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In the context of global turmoil, India displayed steady economic growth and the Economic Survey credited projection of India’s real GDP growth at 6.4 per cent in FY25 to agriculture (and also services), with rural demand improving on the back of record Kharif production and favourable agricultural conditions. The agriculture sector is expected to rebound and grow by 3.8 per cent in FY25 against 5.4 per cent in FY24.

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India’s airport capital expenditure programme which s being pursued by private and public sector (without budgetary support) has achieved 91 per cent of the planned outlay of over Rs 91,000 crore from FY20 to FY25, revealed the Economic Survey FY25 which was tabled in the Parliament on Friday. 

The survey said new airports and improved regional connectivity under the Ude Desh ka Aam Naagrik (UDAN) scheme has improved air connectivity considerably. 

“Under the regional connectivity scheme (UDAN), 619 routes connecting 88 airports, including two water aerodromes and 13 heliports, have been operationalised so far,” said the survey tabled by the Finance Minister Nirmala Sitharaman. 

Besides, the survey document showed that airport’s cargo handling capacity has been gradually increasing, reaching eight million MT in FY24. In FY23, airport’s cargo handling capacity had grown to 7.5 million MT.

India constructed 5,853 km of national highway (NH) during FY25 (April-Dec), revealed the Economic Survey FY25 which was tabled in the Parliament on Friday. In FY24 (April-Dec) India had constructed 6,215 km of national highways.

According to survey, tabled by the Finance Minister Nirmala Sitharaman, India has a total road network of 63.4 lakh km, including national highway (NH) network of 146,195 km. 

“NH network forms the arterial backbone of road transport network as even though it comprises only 2 per cent of total road network yet it carries about 40 per cent of the overall road freight traffic,” the survey said.

P.Chidambaram writes says “Nobody trusts this government and its weaponised agencies -- not business, not academics, not professionals, not farmers, not workers, not teachers, not students, not the middle class, and not the poor. Congratulations, Mr CEA! And thank you Honourable Finance Minister for letting the CEA speak his mind frankly”

It is a concentrated impact of a couple or 3-4 items which lead to higher food inflation. If we remove these items it will be close to target from 8 per cent.

If social impact of technological deployment has social impact in terms of jobs. Then there will be calls for regulations in countries. On the issue of taxing private companies on job loss, CEA says, Not reached that point and so not getting into specifics

One of the biggest magnets for FDI is prospects of profitable returns which India is providing. Government taking several measures. Tariffs and VISA policies: Govt is responding FDI numbers should be looked at from the perspective of global developments

“Do not want to talk on speculative scenarios. Whatever policy measures need to be taken in anticipation of some changes are being taken by Ministries,” says CEA

Recommendation made to Union Government and to states is to take steps to boost employment and therefore consumption. By enabling ease of doing business and reducing fixed costs will lead to employment generation which in turn will boost consumption, says CEA

we see this as a protectionist means. It will only shift carbon emissions. How much emissions will be stopped there are many studies that not much gain will happen, CEA media briefing

Also, shift away from money lenders towards institutional lending. Working capital requirement has been helped by credit schemes. Private sector needs to invest

Small Modular nuclear reactors will also help in energy security for India’s growth, says CEA

We have built several elements of solar energy supply chain in India. At the same time dependence has been there. We need to adopt multiple approaches to handling this

Small businesses do get seasonal surges in orders. It will be good for them to have flexibility for working limits that can be scaled up or down depending on orders, says CEA on Factory Act amendment

This is speaking about importance of domestic growth drivers and supply chain resilience

Core inflation is below 4 per cent. Tomato onion and potatos have high inflation, says CEA

He adds, private consumption share has increased. Govt expenditure has come down compared to FY18. Exports share has gone up. Inflationary pressures have come down barring a few items

Energy Transition: Net Zero goals: Green public transport is a very good avenue for green energy transition, says CEA

India’s use of coal has not impacted its NDCs Country needs to generate more adaptation finances

if you want to purse and be competitive than a lot of subsidisation has to happen... Net Zero goals: adaptation is very important, says CEA

If consumption of ultra processed foods is high, low exercise will impact mental health. It is a global finding. It impacts work productivity. Ultra processed food can lead to diseases such as cancer. Labelling of processed foods is important. Fair disclosure is needed.

CEA says, “Private sector has to do more in terms of spends on R&D sector”

CEA says,” Careful deployment over a long horizon is important,”

. Growth in employment compensation has huge disparity : CEA

They can be scaled up. Can be considered as possible models to implement in other areas : CEA

We have done at the general government level in developing infrastructure, particularly primary health and education.

Falling data costs. Turnaround in logistics costs and they have come down. Lower time taken to pass tolls on highways. Public Transport needs to play a bigger role in energy transition goals : CEA

Bring more area under irrigation, land pooling, freedom to farmers to sell their produce. These can unlock up to 1 per cent of incremental growth: CEA

We continue to focus on augmenting internal capacities for growth. There is enough scope to raise Agri contribution to 1 per cent of GDP growth: CEA

States with Business Reform action plans have better positive industrial activity. Working hours needs to be flexible, and Industries should make a decision on the working hours: CEA

We have to raise our game of domestic growth through De-regulation for growth, role of private sector in nation building and energy transition based on India’s priorities: CEA

Generate about 8 million jobs per year. Plug India business in global supply chain

Going forward, policies for electric vehicles must focus on de-risking supply chains by promoting a more self-reliant ecosystem powered by increased R&D in advanced battery technologies, such as Sodium-ion and Solid-State Batteries. 

Securing intellectual property in this domain can prove invaluable. Additionally, facilitating investment in battery recycling infrastructure can yield greater long-term gains for the Indian automotive sector. In the interim, PLI Schemes can also reward the making of EV cells (Lithium-ion cells), as most manufacturing and value addition happens up to the cell-making stage. India must aim to establish technology transfer agreements with other nations that are also seeking to diversify their supply chains. Partnerships with other aspiring nations can help distribute the high costs of securing a comparative advantage in the global market.

The pursuit of India’s vision to decarbonise road transportation has been accompanied by impressive strides in the promotion of domestic manufacturing facilitated by schemes such as FAME India, the Production Linked Incentive (PLI) Scheme for Auto Components, and the Scheme for Promotion of Manufacturing of Electric Passenger Cars in India (SPMEPCI) among others. 

Critical Minerals : These schemes demonstrate the Government of India’s awareness of the need to build domestic supply chains. These are good foundations. Future policies will have to broaden their scope of coverage in a manner that adapts to the growing needs of the EV industry. 

As demand for EVs is expected to grow, dependence on imported components such as DC motors, e-motor magnets, and other electrical parts will likely rise. Leading EV manufacturers have noted an increasing proportion of Chinese imports in their total material expenditures, reflecting a significant dependence on China for certain resources and technical knowhow.

Across key commodities such as Nickel, Cobalt, and Lithium, China alone is responsible for processing 65 per cent, 68 per cent and 60 per cent of the global output, respectively 26.

Similarly, in the case of Rare Earth Minerals, China contributes to 63 per cent of global mining and 90 per cent of global processing output.

Electric mobility is an important element in India’s path to Net Zero. India has made impressive strides in promoting the domestic manufacture of Electric Vehicles (EV). However, to sustain the growth momentum, there are some important considerations to keep in mind. 

For instance, manufacturing an EV, relative to a conventional car, requires nearly 6 times more minerals to produce, most of which are utilised in producing the EV battery. This is an important consideration as many minerals crucial to EV manufacturing are scarcely available or processed in India while simultaneously being concentrated in very few countries. 

The Ministry of Mines has analysed the 33 critical minerals vital to India’s economic security and found that 24 are currently at high risk of supply disruptions.

Indian labour market indicators have improved in the last seven years, with the unemployment rate declining to 3.2 per cent in 2023-24 (July-June) from 6.0 per cent in 2017-18 (July-June).

This is particularly evident in sectors like aerospace, defence, and semiconductors, where companies are advancing their engineering efforts to focus on next-generation platforms, products, and technologies. 

Over the last five years, the setup rate of engineering research & development GCCs has grown 1.3 times faster than the overall GCC setup, highlighting a continued shift towards high-value-added work.

In the next phase of EoDB, States must work on liberalising standards and controls, setting legal safeguards for enforcement, reducing tariffs and fees, and applying risk-based regulation.

Strategic and systematic deregulation can catalyse growth, innovation, and competitiveness and is critical to encourage innovation for creation of a viable Mittelstand

Similarly, the corporate sector must act responsibly, handling the introduction of AI with sensitivity to India’s needs. A collaborative effort between government, private sector, and academia is essential minimise the adverse societal effects of AI-driven transformation and deliver inclusive growth

Leading organisations are centralising their tech ecosystems in India. This is particularly evident in sectors like aerospace, defence, and semiconductors, where companies are advancing their engineering efforts to focus on next-generation platforms, products, and technologies. 

Over the last five years, the setup rate of engineering research & development GCCs has grown 1.3 times faster than the overall GCC setup, highlighting a continued shift towards high-value-added work

India’s Global Capability Centres (GCCs) are emerging as strategic hubs reshaping the Indian corporate landscape while influencing global business dynamics. 

The number of GCCs in India has grown from approximately 1430 in FY19 to over 1700 in FY24. As of FY24, GCCs in India employ nearly 1.9 million professionals. 

Over the past five years, India has remained at the forefront of the global GCC expansion strategy, with more than 400 new GCCs and around 1100 new units established.

As history also shows us, through careful integration and institutional support, automation brought along with it a rise in the employment-to-population ratio over the 20th century. In this context, the future of work revolves around ‘Augmented Intelligence’, where the workforce integrates both human and machine capabilities. This approach aims to enhance human potential and improve overall efficiency in job performance, ultimately benefiting society as a whole.

AI and Challenges: Practicality and reliability are core issues that need to be addressed by developers. AI also needs significant infrastructure for scaling, which takes time to build. Lastly, AI models have to target efficiency gains without compromising on performance. Addressing these challenges requires a non-trivial amount of time, which in turn provides India a window of opportunity to act.

This would make the country’s transfer pricing regime more attractive and competitive, boost IT exports, and ease business for Global Capability Centres and the IT services industry. Other reforms include the abolition of the 2 per cent equalisation levy, reduction in tax deduction at source on payment made by e-commerce operators to e-commerce participants, relief from GST on data centre exports, reduction of rate of tax collection at source to be collected by e-commerce operators etc.

Tech exports reached nearly $200 billion, reflecting a growth of 3.3 per cent, while the domestic market is expected to expand by 5.9 per cent, crossing $54 billion in FY24. 

The sector maintained its position as a net hirer, adding 60,000 employees to reach a workforce of 5.43 million in FY24. 

The abolition of the angel tax (on investments made by investors in startups) is expected to boost the country’s global innovation and entrepreneurial competitiveness.

Fears of adverse effects of large-scale AI adoption may not seem as far-fetched when viewed in the context of previous industrial and technological revolutions. As illustrated by Andrew Haldane, the former Chief Economist of the Bank of England, previous industrial and technological revolutions have been ‘painful’, characterized by widespread economic hardships, protracted unemployment for those displaced and widening income inequalities. 

Therefore, as policymakers, the possibility of such an outcome materialising must be taken very seriously, especially for a country like India. India’s economy is predominantly service-oriented, with a large portion of its IT workforce engaged in low-value-added services. These roles are particularly vulnerable to automation, as companies may replace labor with technology to reduce costs.

Developers of Artificial Intelligence promise to usher in a new age, one where a bulk of the economically valuable work is automated. AI is anticipated to surpass human performance in critical decision-making across various fields, including healthcare, research, criminal justice, education, business, and financial services. This can result in large scale labour displacement, especially at the middle- and lower-quartiles of the wage distribution.

Electronics Goods: The country reduced its dependence on smartphone imports, with 99 per cent now manufactured domestically.

It has successfully established an installed electricity generation capacity of 2,13,701 megawatts from non-fossil fuel sources, which accounts for 46.8 per cent of the total capacity as of 30 November 2024 against the updated NDC target of reaching 50 per cent by 2030. Further, as per the latest Forest Survey of India 2024, as compared to 2005, when the carbon sink was estimated to be 28.14 billion tonnes of CO2 equivalent, an additional carbon sink of 2.29 billion tonnes CO2 equivalent has been created between 2005 and 2023 against the NDC target 2.5 to 3 billion tonnes by 2030.

The sustained growth in steel sector is fuelled by ongoing development projects and increased public spending in key infrastructure industries.

ONDC : The Open Network for Digital Commerce (ONDC) represents a paradigm shift, promoting a democratic and interoperable digital commerce ecosystem thus fostering inclusivity and equity. ONDC recorded more than 14 million transactions in the month of November 2024 across 1100+ cities. 

Seven-lakh+ sellers and service providers are active on the ONDC network spread across 600+ cities and towns across India and 190+ network participants are live on the network. 

Presently, over 7000 farmer producer organisations (FPOs) have registered to be a part of the ONDC network through various seller network participants.

Developing countries such as India have to bear a disproportionate burden of climate change and have no choice but to face the climate change consequence of historical emissions. Hence, India needs to undertake climate adaptation on an urgent footing as this has a direct impact on lives, livelihoods and the economy.The ongoing works on the preparation of India’s National Adaptation Plan (NAP), therefore, aims to develop a comprehensive and inclusive NAP that aligns with sustainable development goals and ensures climate resilience for all regions and sectors.

The recent outcome of the New Collective Quantified Goal (NCQG) at CoP29 on finance presents little optimism about the possibility of support to developing countries.

Establishing a small mobilisation target of USD 300 billion annually by 2035 as the NCQG is a fraction of the estimated requirement of USD 5.1-6.8 trillion by 2030. The goal contravenes equity and the principle of common but differentiated responsibility in the global climate response by disproportionately placing the burdens of addressing climate change on those nations that have not historically contributed to the crisis.

C-DoT has developed the SAMVAD app to provide secure call and chat for sharing text, image, audio, and video files and deployed in strategic organizations. 

Uplifting domestic telecom ecosystem: Through its CCRP (C-DOT Collaborative Research Programme), C-DOT fosters indigenous telecom innovation by partnering with industry players. This initiative strengthens India’s telecom research ecosystem, with C-DOT offering funding and expertise to help companies develop advanced technologies. 

C-DOT also supports startups incubated under the CCRP framework. The national initiative for developing and harnessing innovations (NIDHI) and Avishkar programme have been launched by the government to nurture innovations and ideas into startups.

4G and 5G core networks: C-DOT has been instrumental in developing indigenous 4G and 5G core solutions, reducing reliance on global vendors and helping in reduction of telecom imports. Its innovations support the deployment of secure, scalable networks tailored to India’s needs.

Quantum communication systems: Recognising the rising importance of cybersecurity, C-DOT has developed quantum encryption solutions, ensuring secure communication for government and strategic sectors. Cybersecurity and resilience: As telecom infrastructure evolves, so do the threats. C-DOT has developed indigenous cybersecurity tools that monitor and protect critical infrastructure.

Karnataka, Maharashtra, Tamil Nadu, Uttar Pradesh, and Gujarat together contribute over 50 per cent of the service sector GSVA. According to the Annual Survey of Unincorporated Sector Enterprises 2022-23, the estimated number of unincorporated sector enterprises is 6.5 crore, with 72.6 per cent operating in the service sector.

Services: The service sector’s contribution to total GVA has risen from 50.6 per cent in FY14 to 55.3 per cent in FY25 (First Advance Estimates). Services 

India has an overall teledensity of 84 per cent and 941 million broadband users as of 31st October, 2024. The country also leads in mobile data consumption per subscriber and offers the world’s most affordable data rates. India’s achievement of the fastest 5G rollout globally highlights its technological prowess in the telecom sector.

Pharmaceuticals: The total annual turnover of pharmaceuticals in FY24 was ₹4.17 lakh crore, growing at an average rate of 10.1 per cent in the last five years. 

Government introduced the Kisan Credit Card (KCC) and Modified Interest Subvention Scheme (MISS), among other steps, to enable farmers to meet their short-term working capital requirements.

Among these, the fisheries sector has shown the highest compound annual growth rate (CAGR) of 8.7 per cent, followed by livestock with a CAGR of 5.8 per cent.

The rollout of 5G services, along with the introduction of new policies aimed at enhancing telecommunications infrastructure and user experience, has played a crucial

role in digital connectivity. By October 31, 2024, 5G services were launched in all states

and union territories. Currently, 5G services are available in 779 out of 783 districts10.

Over 4.6 lakh 5G Base Transceiver Stations (BTSs) have been installed nationwide.

Gross FDI inflows recorded a revival in FY25, increasing from $47.2 billion in the first eight months of FY24 to $ 55.6 billion in the same period of FY25, growing 17.9 per cent

It represents an increase of 8.94 MT from the previous year, positively impacting food security.

The government’s digital connectivity initiatives have also gained traction, particularly with the rollout of 5G services across all states and union territories by October 2024. Efforts to provide 4G mobile services to remote areas under the Universal Service Obligation Fund (now Digital Bharat Nidhi) have made significant strides, with over 10,700 villages covered by December 2024. 

Under Phase II of the Swachh Bharat Mission-Grameen, during April to November 2024, 1.92 lakh villages were incrementally declared ODF Plus under the model category, taking the total number of ODF Plus villages to 3.64 lakh.

City transportation network is expanding rapidly, with metro and rapid rail systems operational or under construction in 29 cities, covering over 1,000 kilometers.

The government has also launched the National Industrial Corridor Development Programme to create advanced industrial cities across India. In phase 1, a total of 383 plots covering 3788 acres have been allotted for industrial use for various sectors.

Port capacity improved significantly in FY25, leading to improvements in operational efficiency and reduction in average container turnaround time in major ports from 48.1 hours in FY24 to 30.4 hours during FY25 (Apr-Nov).

In the power sector, the capacity addition in solar and wind power has lead to a 15.8 per cent year-on-year increase in renewable energy capacity by December 2024.

The share of renewable energy in India’s total installed capacity now stands at 47 per cent. Meanwhile, the government’s schemes like the DDUGJY and the SAUBHAGYA have improved electricity access in rural areas, electrifying 18,374 villages and providing electricity to 2.9 crore households.

Public sector investment alone cannot meet the requirements of infrastructure, and private sector participation will be crucial to bridge the gap. 

Under railway connectivity, 2,031 km of railway network was commissioned between April and November 2024, and 17 new pairs of Vande Bharat trains were introduced between April and October 2024. In FY25 (April-Dec), 5,853 km of National Highways constructed.

Digital connectivity has made major advancements in digital inclusion, technological innovation, and regulatory reforms this fiscal year, all in line with the government’s vision for a Digital India

India’s current account deficit stood at 1.2 per cent of GDP in Q2 of FY25, supported by rising net services receipts and an increase in private transfer receipts.

1. The social services expenditure of the government (combined for centre and states) has increased at a compound annual growth rate of 15% from FY 21 to FY 25. 

2. The Gini coefficient, a measure of inequality in consumption expenditure, has been declining in recent years (For rural areas it declined to 0.237 in 2023-24 from 0.266 in 2022-23 and for urban areas, it fell to 0.284 in 2023-24 from 0.314 in 2022-23), aided by various fiscal policies of the government which are reshaping income distribution.

3. On the school education front, the government is working toward meeting the objectives of National Education Policy 2020 through a range of programmes and schemes. This inter-alia includes the Samagra Shiksha Abhiyan, DIKSHA, STARS, PARAKH, PM SHRI, ULLAS, PM POSHAN, etc.

4. In the total health expenditure of the country between FY15 and FY22, the share of government health expenditure has increased from 29.0 per cent to 48.0 per cent. During the same period, the share of out-of-pocket expenditure in total health expenditure declined from 62.6 per cent to 39.4 per cent.

5. The increase in government spending on health has an important implication for the reduction of financial hardship endured by households. The Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB PM-JAY) has played a decisive role in the significant reductions observed in the out-of-pocket expenditure with over ₹1.25 lakh crore in savings recorded.

6. The government is committed to enhancing the quality of life in rural areas to promote more equitable and inclusive development. There is considerable progress in development of rural infrastructure including road, housing, water bodies, health infrastructure, drinking water, sanitation etc.

7. The strategy of “Localisation of Sustainable Development Goals (SDGs)” has been adopted to ensure that budgets at the gram panchayat levels align with the SDG objectives. The focus is on improving quality of life through the provision of basic necessities of housing, sanitation, education, water supply, electrification, etc.

India’s foreign exchange reserves stood at $640.3 billion as of the end of December 2024, sufficient to cover 10.9 months of imports and approximately 90% of the country’s external debt, reflecting strong buffer against external vulnerabilities.

Agriculture: The development of climate-resilient crop varieties and enhanced farming practices are essential to mitigate the effects of extreme weather events and reduce volatility in food prices.

India’s external sector continues to display resilience amidst global uncertainties and headwinds. Overall exports (merchandise + services) have grown steadily in the first nine months of FY25, witnessing a YoY growth of 6 per cent. This demonstrates the resilience of the export sector, which has been building on a steady upward trend in recent years despite global economic challenges.

The Reserve Bank of India and the International Monetary Fund project that India’s consumer price inflation will gradually align with the target of around 4 per cent in FY26.

Monetary and Finacial Sector: It has resulted in creditors realising ₹3.6 lakh crore, which is 161 per cent against the liquidation value and 86.1 per cent of the fair value of the assets involved.

Services Export: India’s robust services exports have propelled the country to secure the seventh-largest share in global services exports, underscoring its competitiveness in this critical sector.

Inflation: In India, retail inflation saw a reduction from 5.4 per cent in FY24 to 4.9 per cent in FY25 (April-December), aided by various government initiatives and monetary policy measures.

It is 5 per cent more than the amount mobilised during FY24

Monetary and Financial Sector: India’s insurance market has continued its upward trajectory, with total insurance premiums growing by 7.7 per cent in FY24, reaching ₹11.2 lakh crore.

Monetary and Financial Sector: BSE stock market capitalisation to GDP ratio stood at 136 per cent at the end of December 2024, rising significantly over the last 10 years, far higher than other Emerging Market Economies like China (65 per cent) and Brazil (37 per cent).

Export performance: A decline in global commodity prices affected India’s merchandise exports. However, during April - December 2024, nonpetroleum and non-gems and jewellery exports were up by 9.1 per cent: Economic Survey 2025

With credit growth outpacing nominal GDP growth for two successive years, the credit-GDP gap narrowed to (-) 0.3 per cent in Q1 of FY25 from (-) 10.3 per cent in Q1 of FY23, indicating that the recent growth in bank credit is sustainable.

The Gross Non-Performing Assets ratio of Scheduled Commercial Banks has declined consistently from its peak in FY18 to a low of 2.6 per cent at the end of September 2024.

The agriculture sector remains strong, consistently operating well above trend levels. The industrial sector has also found its footing above the pre-pandemic trajectory. The robust rate of growth in recent years has taken the services sector close to its trend levels.

The gross non-performing assets (NPAs) in the banking system have declined to a 12-year low of 2.6 per cent of gross loans and advances.

India’s robust services exports have propelled the country to secure the seventh-largest share in global services exports, underscoring its competitiveness in this critical sector.

A decline in global commodity prices affected India’s merchandise exports. However, during April - December 2024, nonpetroleum and non-gems and jewellery exports were up by 9.1 per cent.

After the general elections, union government capex has grown by 8.2 per cent during July – November 2024 year-on-year

Taking stock of the steep decline in inflation, major central banks have been reducing policy rates.

The IMF projects global growth to average around 3.2 per cent over the next five years, which is modest by historical standards. While the overall global outlook remains steady, growth varies across different regions: Economic Survey

Rajya Sabha adjourns till 1 hour after the Union Budget is tabled in Parliament on February 1, 2025 by the Finance Minister

Lok Sabha adjourns till 11 AM, February 1, 2025.

The forecast suggests economic conditions will remain sluggish next year. Growth is expected to slip to 6.4% in the current financial year - the slowest in four years - from 8.2% last year.

Please click here to follow all the updates regarding the Union Budget 2025.

Innovation, inclusion, investment basis of our roadmap for economic activities: PM Modi ahead of Budget session.

The Economic Survey document, prepared by the Economic Division of the Department of Economic Affairs in the Ministry of Finance and formulated under the supervision of the chief economic adviser, gives insights into the state of the economy and various indicators of 2024-25 (April-March) and some outlook for the next fiscal.