Key Highlights from the Economic Survey 2024-25
The Economic Survey 2024-25 provides a comprehensive overview of India’s economic trajectory, growth patterns, and policy focus areas for the coming fiscal year. Below are the key highlights:
1. Macroeconomic Overview & Growth Trends
- GDP Growth: India’s real GDP is estimated to grow at 6.4% in FY25. Growth in the first half was supported by agriculture and services, while manufacturing faced headwinds due to weak global demand.
- Domestic Demand: Rural demand saw an improvement, supported by record Kharif production and favorable agricultural conditions. Private consumption remained steady.
- Sectoral Contributions:
- Agriculture: Steady growth in H1 FY25 (3.5% in Q2), with record Kharif food grain production of 1647.05 lakh metric tonnes.
- Manufacturing: Slowed due to global demand challenges and domestic supply chain issues.
- Services: The services sector demonstrated resilience, supporting GDP growth.
2. External Sector & Trade Performance
- Trade Balance: Exports of goods and services increased by 5.6% in H1 FY25, while imports grew at a slower pace of 0.7%, contributing positively to net exports.
- Diversification in Exports: India’s push to new markets saw success in sectors such as pharmaceuticals, machinery, and agricultural products.
- Foreign Exchange Reserves: Reserves stood at USD 640.3 billion as of December 2024, covering 90% of India’s external debt.
3. Fiscal Management & Public Finance
- Fiscal Discipline: The government continued its focus on reducing fiscal deficit, maintaining fiscal prudence despite increased capital expenditure.
- Capital Expenditure Focus: Investments were directed towards infrastructure, defense, and energy to stimulate economic growth.
- Taxation: Gross tax revenues increased by 10.7% YoY, with higher devolution of taxes to states helping them sustain expenditures.
4. Inflation & Monetary Policy
- Inflationary Trends: Inflation remained moderate, with food inflation expected to ease further in Q4 FY25 due to Kharif arrivals.
- RBI’s Policy Stance: The central bank is likely to maintain a balanced approach, ensuring price stability while supporting growth.
5. Employment & Labor Market Trends
- Job Formalization: Net EPFO subscriptions doubled from 61 lakh in FY19 to 131 lakh in FY24, with 47% of new payroll additions coming from workers aged 18-25.
- AI & Workforce: AI-driven employment is expected to reshape the labor market, improving productivity but also necessitating upskilling initiatives.
6. Education & Human Capital Development
- School Enrollment: India’s school system serves 24.8 crore students across 14.72 lakh schools, with efforts to improve gross enrollment ratios at secondary and higher secondary levels.
- Higher Education: The government aims for a 50% Gross Enrollment Ratio (GER) by 2035, with a focus on multidisciplinary education as per the National Education Policy (NEP) 2020.
7. Infrastructure & Investment Focus
- Infrastructure Growth: Key areas include:
- National Highways Expansion – 4,000 km of highways installed with advanced traffic management systems.
- Multi-Modal Logistics Parks – Six key parks awarded in major industrial centers.
- Railways & Metro Development – Increased urban transport investments.
- Airport Expansion: 91,000 crore capital expenditure plan to boost air connectivity.
8. Social Sector & Welfare Programs
- Women Entrepreneurship: Over 73,151 startups with at least one female director have been recognized under the Startup India Initiative.
- Direct Benefit Transfers (DBTs): DBTs are reducing inequality and have improved rural consumption, with bottom 5% of rural population witnessing a 22% rise in income.
9. Agriculture & Food Security
- Rural Economy Growth: Investments in rural housing and infrastructure are driving development.
- Agri-Exports: India’s agricultural exports saw robust growth, with processed foods and floriculture among the fastest-growing segments.
- Technology Adoption in Farming: AI-based solutions and precision farming are being promoted.
10. Sustainability & Climate Goals
- Green Energy Investments: Significant push toward renewable energy projects to reduce carbon emissions.
- EV Policy & Infrastructure: Expansion of electric vehicle (EV) charging stations across major cities.
Likely Shape of Budget 2025
Based on the survey’s findings, Budget 2025 will likely focus on:
- Infrastructure & Public Capex: Continued investments in highways, railways, and airports to drive long-term growth.
- Taxation & Fiscal Deficit Management: Potential tax policy adjustments to boost revenue collection while maintaining fiscal discipline.
- Rural & Agricultural Development: Additional spending on rural employment schemes, housing, and digital infrastructure.
- Skill Development & AI Adoption: Increased allocation to education, skilling, and AI integration in workforce training.
- Green Energy & Sustainability: Expansion of solar, wind, and hydrogen energy projects, along with EV incentives.
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