Highlights of the Economic Survey 2024-25

State of the Economy: Getting Back into the Fast Lane

1. According to the latest economic survey, India’s real GDP growth is estimated at 6.4 per cent in FY25 (as per first advance estimates of national income). This equates nearly to its decadal average.
2. Real gross value added (GVA) is also estimated to grow by 6.4 per cent FY25.
3. The global economy grew by 3.3 per cent in 2023. This was markedly against the IMF projection of 3.2 per cent growth in the next five years, highlighting differences in their economic survey data.
4. The real GDP growth in FY26 is expected to grow between 6.3 and 6.8 per cent. This consideration takes into account the upsides and downsides to growth.
5. Thrust on grassroots-level structural reforms and deregulation to reinforce the medium-term growth potential and boost global competitiveness of Indian economy.
6. Geopolitical tensions, ongoing conflicts and global trade policy risks continue to pose significant challenges to the global economic outlook.
7. Retail headline inflation has softened from 5.4 per cent in FY24 to 4.9 per cent in April –December 2024.
8. Capital expenditure (CAPEX) improved continuously from FY21 to FY24. Post general elections, CAPEX grew YOY by 8.2 per cent during July –November 2024.
9. India accounts for seventh-largest share in global services exports, underscoring India’s global competitiveness in the sector.
10. During April to December 2024, non-Petroleum and non-Gems & Jewellery exports went up by 9.1 per cent. It reflects the resilience of India’s merchandise exports amid volatile global conditions as outlined in the economic survey.

Monetary and Financial Sector Developments: The Card and the Horse

1. Bank credit has grown at a steady rate with credit growth converging towards deposit growth.
2. Profitability of Scheduled Commercial Banks improved. Consequently, this reflects in a fall in gross non-performing assets (GNPAs) and rise in capital to risk weighted asset ratio (CRAR).
3. Credit growth outpaced nominal GDP growth for two successive years. The credit-GDP gap narrowed to (-) 0.3 per cent in Q1 of FY25 from (-) 10.3 per cent in Q1 of FY23. This indicates sustainable bank credit growth.
4. Banking sector exhibits improvement in asset quality, robust capital buffers, and strong operational performance.
5. The gross non-performing assets (GNPAs) of Scheduled Commercial Banks declined to a 12-year low of 2.6 per cent of gross loans and advances. This was at the end of September 2024.
6. Under the Insolvency and Bankruptcy Code, INR3.6 lakh crore has been realized in resolution of 1,068 plans till September 2024. This amounts to 161 per cent against the liquidation value and 86.1 per cent of the fair value of the assets involved, reflecting findings from the economic survey.
7. Indian stock markets outperformed its emerging market peers despite election-driven market volatility challenges.
8. The total resource mobilisation from primary markets (equity and debt) stands at INR11.1 lakh crore from April to December 2024. This is five per cent more than the amount mobilised during FY24.
9. BSE stock market capitalisation to GDP ratio stood at 136 per cent at the end of December 2024. This is far higher than other Emerging Market Economies like China (65 per cent) and Brazil (37 per cent).
10. India’s insurance market continued its upward trajectory. Total insurance premiums grew by 7.7 per cent in FY24, reaching INR11.2 lakh crore. The economic survey notes this positive trend as well.
11. Above all, India’s pension sector experienced significant growth. The total number of pension subscribers grew by 16 per cent (YoY) as of September 2024.

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The Economic Survey 05 Sep’24