Chief Economic Advisor V. Anantha Nageswaran
Union Finance Minister Nirmala Sitharaman on Friday (January 31, 2025) tabled the Economic Survey for the year 2024-25 in Parliament. Along with the Union budget to be tabled on February 1, the document aims to provide an overview of the Indian economy by looking at indicators like Gross Domestic Product (GDP), government expenditure and incomes, fiscal deficit, capital expenditure, debt, industry, services and more. Here is the key takeaways from the Economic Survey 2024-25:
Real GDP
Despite global uncertainty, India has maintained steady economic growth, according to the Economic Survey 2024-25. The Survey reports that India’s real GDP growth of 6.4% in FY25 remains close to the decadal average and projects real GDP growth for FY26 to range between 6.3% and 6.8%.
FDI inflow
FDI indicates the amount of money invested in Indian companies by foreign investors. These inflows also regulate balance of payments and the rupee’s strength. Net FDI inflows have fallen during the first eight months of FY25 due to a rise in repatriation/disinvestment, according to the Survey. For the overall financial year, FY24 saw a drop in FDI compared to previous years.
Inflation
The Economic Survey 2024-25 reports that food inflation, measured by the Consumer Food Price Index (CFPI), rose from 7.5% in FY24 to 8.4% in FY25 (April-December), driven mainly by rising prices of vegetables and pulses.
Retail inflation, tracked by the Consumer Price Index (CPI), averaged 5.4% during the same period. While this remained within the Reserve Bank of India’s (RBI) upper tolerance limit, it exceeded the central bank’s 4% comfort level. Food inflation, in particular, crossed 8% multiple times, largely due to supply disruptions affecting key commodities like onions, tomatoes, and pulses.
Manufacturing PMI
The manufacturing sector, while steadily recovering, remains slightly below its pre-pandemic trajectory as it recovers from slowing global demand and supply chain disruptions, according to the Economic Survey 2024-25.
Foreign Exchange Reserves
The country’s foreign exchange reserves act as a means to service external debt and imports, maintain liquidity and plays an important role in monetary policy. As of December 2024, the reserve stood at 640.3 billion U.S. dollars as per the Survey. This amount will cover 90% of India’s external debt of 711.8 billion dollars as of September 2024, as per the document.
Employment indicators
India’s labour market has expanded in recent years, driven by post-pandemic recovery and greater formalisation, according to the Economic Survey 2024-25. The 2023-24 annual Periodic Labour Force Survey (PLFS) report shows that the unemployment rate for individuals aged 15 and above has declined steadily from 6% in 2017-18 to 3.2% in 2023-24.
Trade
The value of exports and imports fell by 0.1% and 2.3% in FY24 when compared to FY23. But they have seen a rise in FY25 (April to December) by a 6.6% and 3%.
UPI payments
UPI payments have seen an exponential growth since it was launched in FY2016. The total value of UPI payments almost touched ₹2 lakh billion in FY24, and it has already surpassed ₹1.9 lakh billion from April to December in FY25.
Published – January 31, 2025 03:57 PM is
