NEW DELHI — The real GDP growth for India in FY 2025-26 is projected at 6.5
per cent, with risks evenly balanced, the Reserve Bank of India (RBI) said on
Thursday.
The Indian economy is poised to remain the
fastest-growing major economy this fiscal (FY26) by leveraging its sound
macroeconomic fundamentals, robust financial sector and commitment towards
sustainable growth, said the RBI in its ‘2024-2025 annual report’.
This growth will come despite global financial market
volatility, geopolitical tensions, trade fragmentation, supply chain
disruptions and climate-induced uncertainties which pose downside risks to the
growth outlook and upside risks to the inflation outlook.
The outlook for the Indian economy remains promising in
2025-26, supported by revival in consumption demand, the government’s continued
thrust on capex while adhering to the path of fiscal consolidation, healthy
balance sheets of banks and corporates, easing financial conditions, continuing
resilience of the services sector and strengthening of consumer and business
optimism, besides sound macroeconomic fundamentals.
“The prospects for agriculture sector appear favourable
in 2025-26 on the back of expected above normal south-west monsoon and several
productivity-enhancing government policies. In the Union Budget 2025-26,
various new initiatives have been announced for boosting agriculture sector,”
said the RBI report.
Manufacturing sector is expected to gain further traction
in 2025-26 supported by improvement in domestic demand, higher capacity
utilisation, healthy balance sheets of corporates and banks, and consumer and
business optimism.
The government’s focus on widening the manufacturing base
and the policy support through the ongoing PLI scheme and National
Manufacturing Mission announced in the Union Budget 2025-26 is expected to
further strengthen ‘Make in India’ initiative, according to the RBI annual
report.
The optimism about manufacturing and services sectors is
also reflected in the forward-looking surveys conducted by the Reserve Bank.
In FY 2024-2025, the Indian economy exhibited resilience,
supported by strong macroeconomic fundamentals and proactive policy measures,
amidst protracted geopolitical tensions and geoeconomic fragmentation.
“Amid multiple global headwinds, the Indian financial
markets demonstrated resilience and orderly movements. The central government
sustained its fiscal consolidation efforts, supported by buoyant tax revenues
and prudent expenditure management. On the external front, merchandise trade
deficit was offset by robust services exports and steady remittance inflows,
keeping the CAD at a sustainable level,” said the RBI report.
