AFP
India’s economy is set to power ahead in the next fiscal year despite bruising US tariffs and a jittery global outlook, a government report said Thursday.
Growth is expected in the range of 6.8 and 7.2 percent in the financial year beginning April 1, according to the government’s annual Economic Survey tabled in parliament.
It is a shade softer than this year’s projected 7.4 percent but still outpacing estimates by global institutions such as the World Bank.
“The outlook… is one of steady growth amid global uncertainty, requiring caution, but not pessimism,” said the report, authored by the chief economic adviser’s office, striking a measured but upbeat tone.
The survey flagged “tariff-induced disruptions” that could sap exports and unsettle investors, but said ongoing talks with Washington were likely to conclude in the coming year, which could “help reduce uncertainty on the external front”.
Despite being one of the first governments to start trade negotiations with the Trump administration, New Delhi remains one of the few big economies yet to clinch a deal.
Crucially, the survey argues that years of policy overhauls, from tax reforms to infrastructure push, have nudged India’s medium-term growth potential closer to 7 percent.
New Delhi has cut taxes and trimmed interest rates while also using the US tariff crisis as an opportunity to push through a labour law reform.
But the trade uncertainty has led to labour-intensive export sectors staring at job losses, foreign investors offloading Indian equities and the rupee hitting new record lows over the last few months.
The survey comes ahead of Sunday’s annual budget, which will outline how Prime Minister Narendra Modi’s government plans to steer the economy through choppy global waters.
Analysts expect a fresh burst of government capital spending, tempered by an effort to maintain fiscal discipline.
Barclays economists said the budget was likely to double down on “de-regulation” and improving the “ease of doing business” to spur private investment and revive manufacturing, which has remained stubbornly below expectations.
“We expect the FY26-27 union budget to focus on building a ladder to reach the top of the tree, having plucked the low hanging fruits,” they noted.
AFP
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