India’s Economic Survey 2024-25 Highlights Growth Amid Challenges

Why in the news?

The Economic Survey 2024-25 was tabled by Finance Minister Nirmala Sitharaman, outlining India’s steady economic growth amidst global uncertainties, with recommendations for deregulation and business-friendly reforms to boost consumption, employment, and innovation.

India's Economic Survey 2024-25 Highlights Growth Amid Challenges

Global Economic Concerns:

  • The 2024-25 Economic Survey highlights the unfavorable global economic environment.
  • Global trade and investment have slowed, and the shift from globalization to trade protectionism is increasing uncertainty.
  • Concerns about China’s dominance in global manufacturing are noted, with China accounting for one-third of global production.
  • The global economy shows signs of secular stagnation, impacting global trade growth.

State of the Indian Economy:

  • India’s GDP growth is steady despite global uncertainties, with a projected growth rate of 33% to 6.82% in FY25.
  • Private consumption in India is increasing, projected to rise to 8% of GDP in FY25.
  • The Gross Value Added (GVA) surpasses pre-pandemic trends, signaling positive economic growth.
  • Inflation is moderating due to reduced core inflation, though food inflation has increased, driven by supply chain disruptions and weather-related issues.
  • The employment sector shows improvement, with better metrics for unemployment, labor force participation, and worker-to-population ratios.

Survey Recommendations and Government Actions:

  • The Chief Economic Advisor (CEA) recommends deregulation to boost economic growth by simplifying business regulations.
  • The Survey emphasizes the need for business-friendly reforms and increased employment generation to boost consumption.
  • Despite India’s post-pandemic recovery, the Survey warns about limitations in producing critical goods needed for infrastructure and investment.
  • The focus should be on innovation, competitiveness, and reducing government barriers to foster growth and job creation.

Sources Referred:

PIB, The Hindu, Indian Express, Hindustan Times