FICCI Survey Predicts India's GDP Growth at 6.5-6.9% for 2025-26

New Delhi, Jan 28 (NationPress) India Inc. remains positive about the economic growth prospects and desires the Union government to maintain its focus on capital expenditure (Capex) in the upcoming Union Budget for 2025-26, as revealed by a survey conducted by the leading business organization FICCI on Tuesday.

The survey indicates that approximately 64 percent of the participants are optimistic about India’s growth trajectory ahead of the Union Budget.

Nearly 60 percent of respondents forecast a GDP growth rate ranging from 6.5 to 6.9 percent for 2025-26.

While these figures reflect a decline from the over 8.0 percent growth experienced in 2023-24, they align with ongoing external challenges.

A significant majority of participants underscored the necessity for sustaining public Capex, with 68 percent advocating for continued investment to maintain growth momentum.

Industry members are anticipating at least a 15 percent increase in Capex allocation for FY 2025-26.

Moreover, over half of the respondents highlighted the need for reforms to enhance the Ease of Doing Business.

Key reforms related to production factors—especially in areas like land acquisition, labour regulations, and power supply—are deemed crucial.

As the previous year's Union Budget laid out a framework for next-generation reforms, industry members are looking forward to further guidance on these matters, as mentioned in the survey.

“The government’s commitment to fiscal consolidation has positioned us well, and survey participants expect the government to remain committed to this approach,” the survey notes.

Approximately 47 percent of participants anticipate the government will achieve the fiscal deficit target of 4.9 percent for FY 2024-25, while another 24 percent believe the government could report an even lower fiscal deficit.

Additionally, concerns were raised regarding the weak demand situation, prompting a call for a review of the direct tax structure.

A reassessment of tax slabs and rates is essential, as this could increase disposable income and stimulate consumption in the economy.

Respondents also urged for a strong policy push to simplify the tax regime, promote green technologies/renewables and EVs, and ease compliance through digitisation.

On the taxation side, ensuring tax certainty, addressing custom duty inversion, and rationalizing TDS provisions were highlighted as significant themes by participants.

Additionally, there was substantial support for a customs amnesty scheme, with 54 percent in favor of its introduction to expedite dispute resolution.

The survey clearly outlined the sectoral focus for the upcoming Union Budget, identifying infrastructure, manufacturing (especially Industry 4.0), and agriculture/rural development as pivotal areas demanding policy attention.

Nearly 40 percent of respondents emphasized the ongoing necessity to support MSMEs, recognizing their critical role in job creation.

Targeted initiatives for MSMEs should ensure streamlined access to credit and support the adoption of new technologies and sustainability measures.

Improving export competitiveness also surfaced as a priority, with respondents advocating for enhanced logistics efficiency and the continuation of interest equalization schemes to boost India’s position in global trade.

This round of the FICCI pre-Budget 2025-26 Survey was conducted between late December 2024 and mid-January 2025, gathering insights from over 150 companies across various sectors.

The survey provides a comprehensive overview of the sentiments within India Inc. amid a backdrop of moderating economic growth.