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‘Weak rupee does not cause any harm to the economy…’ Finance Minister presented Economic Survey in Lok Sabha
Sandy Verma | January 30, 2026 2:24 AM CST

Economic Survey 2025-26 : Union Finance Minister Nirmala Sitharaman presented the Economic Survey 2025-26 in the Lok Sabha on Thursday. The Economic Survey is an annual document presented by the government to review the state of the country’s economy before the Union Budget. It also gives an overview of the short- to medium-term prospects of the economy. The Economic Survey is prepared by the Economic Division of the Department of Economic Affairs, Ministry of Finance under the supervision of the Chief Economic Adviser.

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According to the Economic Survey, GST changes and reforms turned global uncertainty into opportunity; FY27 will be a year of adjustment as the economy adapts to these changes. The Economic Survey calls for a deeper system-level institutional capacity to take into account the geopolitical implications of India’s rise. The survey said that if the AI ​​boom does not deliver productivity gains as expected, there will be a correction in overly optimistic asset valuations. The rupee’s valuation does not properly reflect India’s excellent economic fundamentals.

According to the Economic Survey, the rupee weakened as foreign capital inflows dried up; Indian currency performed poorly in 2025. FTA with Europe will strengthen India’s manufacturing competitiveness, export strength and strategic capability. In an uncertain global environment, India needs to prioritize domestic growth; For this, more emphasis is needed on buffer and liquidity. The Economic Survey said on the many FTA deals signed, “India needs to produce competitively to realize the potential of the trade agreement.”

The survey said that India’s economy will grow at the rate of 6.8 to 7.2% in FY 27. The Economic Survey on January 29 projected GDP growth at 6.8 to 7.2 percent in 2026-27, slightly lower than the estimated 7.4 percent in the current fiscal year. “Therefore, there is a possibility of stable growth amid global uncertainty, which calls for caution, but not pessimism,” the pre-Budget document tabled in the Lok Sabha said.

The growth projections take into account the aggregate impact of policy reforms in recent years, which has brought the economy’s medium-term growth potential closer to 7 per cent. “Domestic factors play a key role and macroeconomic stability is well maintained, so the balance of risks to growth remains broadly even,” the survey said.

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As per Economic Outlook 2025-26, the ongoing trade talks with the US are expected to end this year. The ongoing negotiations for a trade deal with the US are expected to conclude this year, which may help reduce uncertainty on the external front. It said that for India, global conditions immediately translate into external uncertainties rather than macroeconomic tensions.

Slow growth in key trading partners, trade barriers due to tariffs and volatility in capital flows could weigh on exports and investor sentiment from time to time, the survey said. “Also, the ongoing trade talks with the United States are expected to conclude this year, which may help reduce uncertainty on the external front,” it said.

The Economic Survey reported that India’s medium-term growth potential has increased to about 7% due to the mixed impact of policy reforms in recent years. India is in a better position than most other countries due to its strong macro fundamentals. A strong, stable currency is essential to achieve the goal of a developed India and global influence. The Economic Survey says there is no scope for pessimism, but there is a need to be cautious amid global uncertainty.

The document further said that a weak rupee does not cause any harm as it mitigates the impact of high US tariffs on Indian goods to some extent. The potential emergence of multiple global crises presents an opportunity for India to play a role in shaping the global order. The government is well on its fiscal consolidation path, aiming to achieve a fiscal deficit target of 4.4% of GDP in FY26.

The Economic Survey says – The slow pace of core inflation indicates strengthening of supply-side conditions in the economy. The survey advocates a policy to renegotiate the working conditions for gig workers.

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