India Sustains Robust Economic Growth Amidst Global Turbulence, Reports Standing Committee on Finance

Parliamentary Committee Affirms Strong Economic Performance

The Standing Committee on Finance recently presented its 29th report to the Lok Sabha, confirming that India is maintaining robust economic growth. The report, titled 'Roadmap for Indian Economic Growth in Light of Global Economic and Geopolitical Circumstances,' was tabled by Arun Bharti of LJP (R) on February 12, 2026. It highlighted that India's real Gross Domestic Product (GDP) expanded by 6.5% in the fiscal year 2024-25, a significant achievement given the prevailing global economic uncertainties.

Key Drivers and Growth Projections

India's sustained growth is primarily attributed to strong domestic demand and robust investment. While the 6.5% real GDP growth for 2024-25 is a notable figure, various estimates and projections offer further insight into the country's economic trajectory. The Ministry of Statistics and Programme Implementation also projected India's real GDP to grow by 6.5% in 2024-25. Looking ahead, a realistic GDP growth projection for 2025-26 is 6.5%, supported by stable investment levels and improved capital efficiency. Some forecasts even suggest a rise to 7.4% in FY 2025-26. The services sector continues to be a significant contributor to India's economic expansion.

Navigating a Turbulent Global Landscape

The Committee's report explicitly acknowledged a 'turbulent global economy marked by geopolitical tensions.' This context underscores India's resilience, as global economic growth forecasts from institutions like the IMF project a more modest 3.2% for 2024 and 3.3% for 2025. Factors such as persistent inflation in major economies, the trajectory of interest rate cuts, and ongoing trade tensions contribute to the global uncertainty. Despite these external headwinds, India has managed to maintain its position as the fastest-growing major economy.

Recommendations for Future Prosperity

To achieve sustained prosperity, the Standing Committee on Finance emphasized the need for India's economy to grow by 8% in real terms annually for at least a decade. This ambitious target necessitates an increase in the investment rate from the current 31% to approximately 35% of GDP. The Committee also identified several key areas for focus:

• Enhancing manufacturing competitiveness and diversification.
• Increasing investment in research and development.
• Negotiating bilateral and regional trade agreements.
• Expanding support for high-technology sectors under Production Linked Incentive (PLI) schemes.
• Diversifying the investor base and promoting strategic sectors to attract Foreign Direct Investment (FDI).

Furthermore, the report noted the positive trend of rising credit flow in the Micro, Small, and Medium Enterprises (MSME) sector and highlighted the strength and capitalization of the banking sector. Inflation has also shown a downward trend, reducing from an average of 6.7% in 2022-23 to 4.6% in 2024-25. These measures, alongside a well-regulated financial system and a credible inflation-targeting regime, are deemed crucial for India to continue its strong growth momentum and achieve its long-term economic aspirations.