Economic survey 2024-25:- 20 most important highlights

 

The Economic Survey for the fiscal year 2024-25 was presented in the Indian Parliament on January 31, 2025, by Finance Minister Nirmala Sitharaman. Authored by Chief Economic Adviser V. Anantha Nageswaran, the survey projects India's economy to grow between 6.3% and 6.8% in the fiscal year 2025-26. This projection follows an anticipated growth of 6.4% for 2024-25, marking a four-year low. 

Here are 20 most important highlights of economic survey 2024-25 you need to know:

1. GDP Growth Projection: The economy is expected to grow between 6.5% and 7% in FY25, slightly below the Reserve Bank of India's 7.2% forecast.

2. Employment Generation: To accommodate the expanding workforce, India needs to create approximately 7.85 million non-farm jobs annually until 2030.

3. Inflation Trends: Retail inflation decreased to 5.4% in FY24 from 6.7% in FY23, attributed to effective policy measures.

4. Foreign Direct Investment (FDI): FDI inflows slightly declined to $45.8 billion in FY24 from $47.6 billion in FY23, reflecting global economic trends.

5. Sectoral Performance:

   • Services: Expanded by 7.6% in FY24.
   • Agriculture: Achieved a 4.18% growth over the past five years.

6. Core Inflation: Remains elevated due to persistent services inflation and a robust labor market, particularly in Asia.

7. Inequality Concerns: The top 1% of Indians earn 6-7% of total incomes, while the top 10% account for one-third. The government aims to address this through job creation and integrating the informal sector.

8. Fiscal Deficit: Globally, the general government fiscal deficit rose by 1.6 percentage points in 2023. In contrast, India's focus on capital expenditure and private investment led to a 9% real-term growth in Gross Fixed Capital Formation in 2023-24.

9. Current Account Deficit (CAD): Improved to 0.7% of GDP in FY24 from 2.0% in FY23, aided by strong services exports despite subdued global goods demand.

10. Private Investment: The government's emphasis on capital expenditure and robust private investment has bolstered capital formation.

11. Global Economic Environment: The survey cautions about the challenging global environment, emphasizing the need for domestic efforts to sustain recovery.

12. Banking Sector Resilience: The Gross Non-Performing Assets (GNPA) ratio of Scheduled Commercial Banks (SCBs) has been declining, reflecting improved asset quality. Additionally, the Return on Assets (RoA) of SCBs is rising, signaling enhanced profitability and stability in the banking sector.

13. Structural Reforms: Initiatives like the Goods and Services Tax (GST) and the Insolvency and Bankruptcy Code (IBC) are maturing and yielding anticipated results.

14. Private Capital Formation: After significant growth in recent years, there may be caution due to concerns over cheaper imports from countries with excess capacity.

15. Financial Markets: Global financial markets have reached new heights, but potential corrections could impact household finances and corporate valuations, posing risks to growth prospects.

16. IT Sector Employment: Hiring in the IT sector slowed in FY24 and is unlikely to see a significant uptick in the near term.

17. Policy Recommendations: The survey suggests focusing on boosting private investment, supporting MSME growth, unlocking agricultural potential, securing financing for green transitions, bridging the education-employment gap, and enhancing state capacity.

18. Global Trade Outlook: While there's optimism for global trade in 2024, risks like geopolitical fragmentation and protectionism could affect merchandise trade growth, impacting India's external sector.

19. Agricultural Sector: Recognized as a potential engine for future growth, with a call to remove policy impediments to fully harness its capabilities

20. Environmental Progress: As per the Forest Survey of India 2024, India has created an additional carbon sink of 2.29 billion tonnes CO₂ equivalent between 2005 and 2023, advancing its commitment to climate goals under the Paris Agreement.

21. Healthcare Accessibility: Government health expenditure has increased from 29.0% to 48.0% of total health spending, reducing the share of out-of-pocket expenses from 62.6% to 39.4%, alleviating financial stress on households and improving healthcare affordability.

22. Sustained Economic Growth: To achieve Viksit Bharat by 2047, India must sustain an 8% growth rate at constant prices for one to two decades, requiring strategic investments in infrastructure, technology, and human capital.

These insights from the Economic Survey 2024-25 provide a clear snapshot of India's current economic status and future trajectory.