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BUDGETING FOR GROWTH
January 18, 2025
|Mint Chennai
FY26 outlook is increasingly uncertain, with sizeable risks from global developments
India's growth outlook has turned less rosy of late, raising expectations around policy support from the Central government, with the Union budget just around the corner.
The First Advance Estimates (FAE) for FY25 released by the National Statistical Office (NSO) pegged GDP expansion at 6.4% for the fiscal. To be fair, this will exceed the growth of most large economies in the world. However, it is substantially lower than the 8.2% logged in FY24, and also a shade below the range of 6.5-7.0% that the Economic Survey had projected. Further, the outlook for FY26 appears increasingly clouded with sizeable risks stemming from global developments.
Given this context, the upcoming budget for FY26 assumes accentuated importance. While expectations will be high for the government to ensure some growth support to the economy, it will be equally critical to demonstrate continued fiscal consolidation.
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