Economic Survey 205: Finance Minister Nirmala Sitharaman introduced the Economic Survey in Parliament on Friday, 31 January. According to the survey, India’s GDP growth may be 6.3-6.8% in FY 2025-26. Between global uncertainty, inflation is expected to be controlled and consumption stable. There is also a possibility of improvement in rural demand. The last economic survey was introduced after the general election in July 2024.
Economic survey is a compilation of the progress of the Indian economy, government policies and the approach to the next financial year. It is prepared by the Economic Branch of the Department of Economic Affairs, which is the main Chief Economic Advisor (CEA). Presently V. Anant Nageswaran, the Chief Economic Advisor to the Government of India.
Learn 10 main things of Economic Survey 2025
1. Indian economy will remain stable
India’s actual GDP growth in FY25 will be 6.4%, which is close to decades. In FY26 it is likely to live between 6.3% to 6.8%. GVA is also estimated to increase 6.4%.
2. Decline in retail inflation: Government’s efforts and weather challenges
Retail inflation in FY24 in India has come down from 5.4% to 4.9% in FY25 (April-December). The main reason for this decline in inflation is a decrease of 0.9% in core inflation, which is mainly associated with the fall in core services and fuel prices. Steps such as the government strengthening buffer stocks, release in open market and relaxation of imports have been important under inflation control. The FY25 (April-December) contributed 32.3% of the total food inflation of vegetables and pulses. The main reason for the increase in prices of vegetables is meteorological problems such as floods, droughts, and storms that hinders supply. FY24 and FY25 remained due to a decrease in pressure production in FY24 and FY25, while tomato prices remain higher than FY23, as it is a quick deterioration product and its production is concentrated in a few states. To increase the production of pulses, oil seeds, tomatoes and onions, research and farmers need to be trained on anti-climatic crops. To ensure the supply of toor dal, the government set up a stock limit and imported 7.7 lakh tonnes to FY24. The RBI and IMF estimate that inflation rates may come close to 4% by FY26. IMF has estimated 4.4% in FY25 and 4.1% in FY26. According to the World Bank, the prices of commodity are expected to fall by 5.1% in 2025, which can provide relief in India’s domestic inflation.
3. India’s agriculture sector showed strength: Economic Survey
According to the Economic Survey 2024-25, the agricultural sector of India has recorded an average annual growth rate between FY 2017 and 2023. In the second quarter of 2024-25, the growth rate of the agricultural sector was 3.5%. The gross value of agriculture and related sectors increased from 24.38% of FY15 to 30.23% in FY23. Kharif crop production is estimated to be 1,647.05 lakh metric tonnes in 2024, which is 89.37 lakh metric tonnes more than last year.
The government is running several schemes to increase farmers’ income and strengthen agriculture, including Digital Agricultural Mission, E-NAM and PM-Kisan. The minimum support price (MSP) has been fixed 1.5 times the cost of production, with a huge increase on crops such as pigeonpea, millet, lentils and mustard. For irrigation, 95.58 lakh hectares of land has been covered between FY16 and FY25 under the ‘Drop Peacock Crop’ scheme.
Animal husbandry sector is also developing rapidly, which contributes 5.5% to GVA. In FY23, the total value of animal husbandry reached ₹ 17.25 lakh crore, of which ₹ 11.16 lakhs came from milk production alone. Fish production also increased to 184.02 lakh tonnes in FY23, which was 95.79 lakh tonnes in FY14. Export of marine products reached ₹ 60,524 crore in FY24.
Flower cultivation is considered an emerging industry, where the first half of FY25 recorded an increase of 14.55% in exports. The export of fruits like grapes has also increased, where ₹ 3,460.70 crore was exported in FY24.
The food processing sector has also seen a boom. The export of agricultural-food products in FY24 reached USD 46.44 billion, with processed food products to be 23.4%. The government is also providing loan facility to farmers on storage of crops through E-NWR and is working towards implementing 100% E-KYC in the Public Distribution System (PDS). The purpose of all these efforts is to modernize the agriculture sector and increase the income of farmers.
4. Fast speed of service sector: tremendous boom in export, employment and digital consumption
According to the Economic Survey 2024-25, the total gross value of services in FY14 contributed to 50.6%, which has increased to 55.3% in FY25 to 55.3%. The growth rate of Service Sector between FY23 and FY25 was 8.3%, which played an important role in strengthening the country’s GDP. During April to November FY25, the export of services recorded a rapid increase of 12.8%. The availability of skilled workers, simplifying procedures and improving regulations have been described as important for manufacturing and services progression. 19 lakh professionals have got employment through the Global Capability Center. At the same time, average monthly data consumption has also increased from 12.1 GB to 19.3 GB in FY24, which reflects an increase in digital use.
5. New jump of economic strength
According to the Economic Survey 2024-25, credit growth in the Indian economy remains stable, which has increased the profiteering of banks and declines in NPA. The quality of property of rural financial institutions has improved, where pure NPA has come down from 3.2% (FY23) to 2.4% (FY24). The credit-detachment ratio of regional rural banks increased from 67.5% in March 2023 to 71.2% in March 2024.
Monetary policy has ensured sustainable development and liquidity while maintaining price stability. The number of investors in the Indian capital market has exceeded double in the last four years to 4.9 crore (FY20) to 13.2 crore (2024). The Primary Market (Equity and Date) raised a resource of ₹ 11.1 lakh crore between April and December 2024, which is 5% higher than the previous year.
The insurance sector has also performed well, where the total insurance premium in FY24 increased by 7.7% to ₹ 11.2 lakh crore. The pension market continued to rise, and the number of total pension subscribers reached 783.4 lakhs in September 2024. The Financial Inclusion Index has increased from 53.9 in March 2021 to 64.2 in March 2024. The Economic Survey also states that institutionaling regulatory impact evaluation in independent regulatory institutions is necessary for the strengthening of the financial sector.
6. Infrastructure development will gain momentum by increasing private investment
India needs continuous investment in infrastructure for sharp growth in the next 20 years. In the last 5 years, the government has focused on physical, digital and social infrastructure. Public funding will not fulfill these needs alone, so private sector participation will have to be increased. For this, improvement in cases like project planning, risk and revenue sharing, contract management and dispute is necessary.
Projects have been supported by schemes such as National Infrastructure Pipeline, PM-Gatti Shakti, but private investment in many core sectors is low. Capital expenses in Q1Fy25 slowed down due to elections and poor monsoon, but in July-November 2024 it gained gains and 60% budget has been spent. The next months are expected to raise further.
7. Revolution in farming: New flight of irrigation, organic farming and cooperative development
The irrigation sector between FY16 to FY21 has increased rapidly, where it increased from 49.3% to 55%. Under the ‘Drop More Crop’ scheme, ₹ 21,968.75 crore was released to the states, causing micro irrigation coverage in an area of 95.58 lakh hectare between FY16 and FY25. Loans of ₹ 4,709 crore were approved from Micro-Inargation Fund, out of which ₹ 3,640 crore was distributed. Organic farming was promoted in 14.99 lakh hectares through the Traditional Agricultural Development Scheme and 25.30 lakh farmers were motivated for this. Also, more than 9,000 new primary agricultural credit committees, dairy and fisheries were established, while 35,293 PACS were developed as Prime Minister Kisan Samriddhi Center.
8. Kisan Credit, Subsidy, and Schemes Strengthen rural economy
As of March 2024, 7.75 crore Kisan Credit Cards are active. 5.9 crore farmers got benefits from the revised interest subsidy scheme and claims more than Rs 1 lakh crore. At the ground level, the agricultural credit increased from ₹ 8.45 lakh crore (2014-15) to ₹ 25.48 lakh crore (2023-24). The share of small and marginal farmers has increased from 41% to 57%.
In FY 2023-24, the number of farmers increased by 26% in the PM Crop Insurance Scheme. The PM-Kisan Yojana benefited more than 11 crore farmers, while 23.61 lakh farmers joined the PM Kisan Maandhan Yojana. 15,000 women self -help groups will get drones for agricultural work.
So far, 48,611 storage projects have been approved and a subsidy of ₹ 4,795.47 crore has been released. Two-thirds of the country’s population has been covered under the National Food Security Act. The government has also started the process of making smart warehouses.
9. Extension of technology and innovation in India’s education system
According to the Economic Survey 2024-25, 24.8 crore students are studying in 14.72 lakh schools in India and 98 lakh teachers are deployed for their education. Computer availability in schools has increased from 38.5% to 57.2% in 2023-24 as compared to 2019-20, while the percentage of schools with internet facility has increased from 22.3% to 53.9%. The rate of students leaving school has also declined, with a rate of 1.9% at primary level, 5.2% at upper primary level and 14.1% at secondary level. The report states that to meet the changing needs of the education system, it is necessary to include artificial intelligence and technology. The number of higher education institutions has also increased by 13.8%, which was 51,534 in 2014-15 and increased to 58,643 in 2022-23. In addition, innovations such as peer teaching have also been prominently highlighted in the economic survey to achieve financial literary and nomarasi targets.
10. Climate action and attention on mental health for India’s economic progress
Economic Survey 2024-25 has described targeted policy, financeing and large grid infrastructure in order to deal with climate change. Considering nuclear energy as an alternative to fossil fuels, there is an emphasis on research in low-emission technology and battery storage. ‘Mission Life’ is said to have a need for awareness campaign to make public movement. The survey on mental health states that excessive intake of poor lifestyle, social media and junk food increases mental problems. Mental health can be improved by spending time with family and friends and physical activities.