New Delhi

India’s potential growth rate could accelerate to 7.5 per cent in the coming years if the country focuses on strengthening manufacturing, boosting exports, and implementing process reforms, Chief Economic Advisor V Anantha Nageswaran said on Thursday.

The Economic Survey 2025‑26, presented in Parliament, revised the medium-term potential growth forecast from 6.5 per cent, projected three years ago, to 7 per cent. Nageswaran noted that with further improvements in manufacturing competitiveness, export performance, land and cost reforms, and reduced production costs, growth could reach 7.5‑8 per cent.

“The reform momentum over the past three years, across manufacturing, logistics, infrastructure, and regulatory processes, has strengthened the foundation for medium-term growth,” he added.

The Survey highlighted initiatives such as Production-Linked Incentive (PLI) schemes, FDI liberalisation, logistics reforms, and sustained public investment in physical and digital infrastructure, which together support capacity creation. Simplified tax laws, regulatory committees, and measures for MSMEs—including expanded credit guarantees, TReDS, and the Unified Lending Interface—have further eased business operations.

For the next fiscal year, the Economic Survey projects GDP growth in the range of 6.8‑7.2 per cent, slightly lower than the estimated 7.4 per cent in the current fiscal, reflecting the cumulative impact of reforms.

Commenting on the rupee, the Survey noted that recent depreciation does not accurately reflect India’s strong economic fundamentals. While a weaker rupee offsets some impact of higher US tariffs, it has caused investors to be cautious, requiring careful examination.

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The FY27 growth projections in the Survey are higher than estimates from international agencies, with the IMF forecasting 6.4 per cent, and the World Bank and Asian Development Bank projecting 6.5 per cent.