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 03-Feb-2025

Economic Survey 2024-2025

Economics

Why in News ? 

Finance Minister Nirmala Sitharaman presented the Economic Survey 2024-25 in Parliament, outlining key reforms and growth strategies ahead of the Union Budget 2025. 

What is the Economic Survey? 

  • An annual report presented before the Union Budget to assess India’s economic health. 
  • Prepared by the Economic Division of the Ministry of Finance under the Chief Economic Adviser’s guidance. 
  • Tabled in both houses of Parliament by the Union Finance Minister. 
  • Evaluates economic performance, highlights sectoral progress, identifies challenges, and provides a future outlook. 
  • First presented in 1950-51 and became an independent document in 1964, released a day before the budget.

Key Highlights of Economic Survey 2024-2025 

  • Global Economy: Global growth at 3.2 % in 2024. Inflation easing, but geopolitical risks (Russia-Ukraine conflict) affecting trade and costs. 
  • India’s Economy: Projected GDP growth of 6.3-6.8% in FY26. Agriculture grew by 3.8%, industry by 6.2%, and services by 7.2% in FY25. 
  • Monetary and Financial Developments: Non-Performing Assets (NPAs) hit a 12-year low. Repo rate at 6.5%, with rising liquidity and strong capital market mobilization. 
  • External Sector: Exports grew 6% while imports increased 6.9%, widening the trade deficit. Foreign Exchange Reserves USD 640.3 billion. 
  • Inflation: Retail inflation eased to 4.9% in FY25, but food inflation rose to 8.4%. 
  • Medium-Term Outlook: India projected to be a USD 5 trillion economy by FY28. Real GDP growth estimated at 6.5% annually. 
  • Key Developments: Infrastructure: 2031 km railway expansion, 17 new Vande Bharat trains, 6,215 km highways built. Renewable energy accounts for 47% of installed capacity. 
  • Social Sector: Education spending grew, improving enrollment rates and reducing dropout rates. Healthcare spending surged to Rs 6.1 lakh crore. 
  • Employment and Skill Development: Unemployment dropped to 3.2%, with female participation rising to 41.7%. Focus on AI-based skill development and job creation. 
  • Challenges: Geopolitical risks, inflation, and trade uncertainties. High logistics costs and slow urbanization planning hinder growth.