New Delhi | January 29, 2026India’s economy is projected to grow between 6.8 per cent and 7.2 per cent in the financial year 2026–27, according to the Economic Survey tabled in the Lok Sabha on Thursday. The forecast is marginally lower than the 7.4 per cent growth estimated for the current fiscal year, reflecting a cautious outlook amid persistent global headwinds.
Presenting a measured assessment of the macroeconomic environment, the Survey stated that India’s growth trajectory remains steady despite external uncertainties. “The outlook, therefore, is one of steady growth amid global uncertainty, requiring caution, but not pessimism,” the pre-Budget document said.
Reform Momentum Lifts Medium-Term Growth Potential
The Survey noted that the growth projection factors in the cumulative impact of structural and policy reforms undertaken over the past several years, which appear to have strengthened India’s medium-term growth potential to around 7 per cent.
Key reforms in areas such as infrastructure development, manufacturing incentives, digital public infrastructure, financial sector stability and ease of doing business have helped reinforce domestic growth drivers, the document observed.
Domestic Demand to Remain the Growth Engine
According to the Economic Survey, domestic demand will continue to play a dominant role in supporting economic expansion, even as global trade and financial conditions remain volatile.
“With domestic drivers playing a dominant role and macroeconomic stability well anchored, the balance of risks around growth remains broadly even,” it said, indicating that India is relatively better positioned than many peer economies to absorb external shocks.
Macroeconomic Stability Anchors Outlook
The Survey underlined that India’s macroeconomic fundamentals — including manageable inflation, stable fiscal consolidation, adequate foreign exchange reserves and a resilient banking system — provide a strong foundation for sustained growth.
While global risks such as geopolitical tensions, supply-chain disruptions and monetary tightening in advanced economies persist, the Survey suggested that India’s policy buffers and reform-driven growth model would help maintain momentum.
Cautious Optimism Ahead of Union Budget
The Economic Survey, released ahead of the Union Budget 2026–27, sets the tone for fiscal policy deliberations, emphasizing the need to balance growth support with macroeconomic prudence.
It concluded that while challenges remain in the global environment, India’s growth story continues to be underpinned by strong domestic fundamentals, reform continuity and rising productivity.
(Economy India)
