January 29, 2026: Ahead of the Union Budget 2026, Finance Minister Nirmala Sitharaman presented the Economic Survey 2025-26 in the parliament today. First Advance Estimate projects real GDP growth to 7.4% and GVA growth to 7.3% for FY 2026 as per the survey. India’s potential growth is estimated at around 7% and real GDP growth is projected between 6.8- 7.2% for FY27, supported by strong macro fundamentals and various regulatory reforms.
Bringing focus on the present scenario, the Economic Survey 2025-26 mentioned that the global environment remains fragile with growth holding up better than expected but risks elevated amid intensifying geopolitical tensions, trade fragmentation and financial vulnerabilities. The impact of these shocks may still surface with a lag. Against this backdrop, India’s performance stands out.
As per the survey, Private Final Consumption Expenditure grew by 7.0% in FY26, reaching 61.5% of GDP, the highest since 2012 (FY23 also recorded 61.5% share). This growth is led by low inflation, stable employment and increasing real purchasing power. Domestic inflation averaged 1.7% for April-December, 2025, marking the lowest inflation rate since the beginning of the CPI series, it stated.
Investment activity strengthened in FY26, with Gross Fixed Capital Formation growing by 7.8% and its share remaining steady at 30% of GDP, backed by sustained public capital expenditure and a revival in private investment activity, as evident from corporate announcements. The survey also mentioned a key milestone for India with unique investors crossing the 12-crore mark in September 2025 and nearly a fourth of them being women.
Focusing on India’s infrastructure as a key growth driver, the survey mentioned that India’s capital expenditure has increased nearly 4.2 times, from Rs 2.63 lakh crore in FY18 to Rs 11.21 lakh crore in FY26 (BE), while effective capital expenditure in FY26 (BE) is Rs 15.48 lakh crore.
Economic Survey is an annual document prepared by the Department of Economic Affairs under the Ministry of Finance, under the guidance of the Chief Economic Adviser V.A. Anantha Nageswaran. It provides a review of the Indian economy and its performance in the past year with a key outlook for the coming year. The Union Budget will be presented by the Finance Minister on February 1, 2026.