Opinion | India An Oasis In The Desert Of A Fractured World: 2026 Economic Survey

India has truly been an oasis of economic performance in the global scenario. We recently signed the ‘mother of all deals’, i.e., India-EU Free Trade Agreement, and also negotiated around seven such deals with other nations in the last five years, and eight others are under negotiation.

While this sends an important signal to distorted global order, let us look at the recently launched Economic Survey 2025-26 by our Chief Economic Adviser (CEA). An Economic Survey is a document to look back, on our finances, on our growth and on our fiscal vision for the upcoming year. This year, we are back to basics — manufacturing, MSMEs and skilling. But also looking forward to urbanisation, AI and nuclear energy.

We will continue to be the world’s fastest

growing economy with GDP growth rate projected to be 6.8-7.2 per cent. From Covid year FY21’s fiscal deficit of 9.2 per cent, we have come down to nearly half at 4.4 per cent this FY26. How could we do this? By increasing tax buoyancy and improving quality of expenditure (capital expenditure).

Rupee is not at its best health, but it will improve as we would have better forex reserves. The flow of resources to the commercial sector has been positive, which should be the focus as private players march towards investments in the economy. We need to generate more investor interest and export earnings.

Inflation has been headlined as ‘tamed’ and ‘anchored’ with Consumer Price Index (CPI) reaching a historic low averaging 1.7 per cent during the first nine months of the fiscal year, positioning the Indian economy in a “Goldilocks” phase where growth is hot but prices are not.

While we have to acknowledge that the “base effect” (comparing today to the wild price spikes of the post-pandemic years) makes these numbers look extra impressive, the real win is that we’ve finally broken the cycle of high volatility and entered a phase of stable deflationary trend.

A striking highlight of the survey is the shift in the rural-urban inflation dynamic; for the first time in recent years, rural inflation has fallen below urban inflation.

On a broader structural level, the Survey credits the anchoring of inflation expectations to the credibility of India’s inflation-targeting framework and consistent monetary policy actions. That said, we can’t afford to be complacent. With global politics as messy as they are, external shocks remain our biggest “wild card.” Staying an economic leader will depend on how well we can shield our domestic progress from global chaos.

Speaking of social sectors like healthcare and education, we are improving but there are also good gaps to fulfill. The Survey says that 81 per cent of rural households have tap water, it should be 100 per cent in the next five years or so. We are a big nation, and big enough to be noticed for our poverty and economic status.

While we strike big deals, it is important to take care of our population across our nook and corner. Through housing and credit schemes too, social welfare is working in favour of our people, which is welcome.

In the healthcare sector, responses on the U-win portal have been positive for immunising our population; the Survey also highlights success of Ayushman Bharat programme. Interestingly, it also mentions banning online gaming in the healthcare chapter, as CEA spoke that online gaming affects mental health of our population.

In education, focus is on enrollment, inclusivity, equity and performance. A welcome move is 100 per cent FDI in the education sector and it is expected that 15 foreign institutions would set up a campus in India.

While there is debate nowadays on banning social media for children under 16, the Survey did mention safe internet guidelines for schools, focus on screen timing, online gaming regulations, online safety, mental health and related helplines, etc. which are forward looking initiatives.

Implementation of labour codes could result in creation of additional 77 lakh jobs for India, an SBI statistics shows, as per November 2025. This is interesting to see, that legal codification is also proportional to ease in doing business, and promoting employment opportunities.

Welcome initiatives in industry and skilling includes, focus on care economy, Anganwadi centres, provision of creches, etc, and promotion of women labour workforce amidst conventional taboo across various sectors.

Increased urban mobility, women safety would encourage women workforce as well. Upgradation of 1,000 ITIs shows that skilling is not a mere buzz word. Industrial skilling is going to improve the state of the economy and is a necessity rather than an alternative. Innovative financing models for skill development are also welcome.

Energy is a global debate. Every country is running after energy. It is a crucial time that we have decided to include nuclear energy in our energy mix. Sustainable Harnessing and Advancement of Nuclear Energy for Transforming India (SHANTI) Act would promote nuclear energy as it is one of the cleanest forms of energy and would overcome issues of intermittency and energy security for us.

A separate chapter on Artificial Intelligence (AI) portrays government’s priority and curiosity to understand the trade-offs. One of the the trade-offs, therefore, is between expending scarce resources to chase frontier-scale models or deploying those resources more effectively.

My concern is that this chapter still debates on various policy choices that India has to take, and there is no clear position. On the other hand, countries like the US, China have already dominated technologies, and AI models which we are yet to even adapt. Our technological push has to be proactive and not reactive.

The urbanisation chapter also catches my eye. Making cities that are innovative and promotes design thinking, cities that inspire imagination is such a need. Imagine a city, where an individual is inspired to take a morning walk because the streets are clean, roads are smooth, and walls reflect the prowess of our great civilisation coupled with modernity.

There is no mention of promoting civilisation though. Amidst all announcements, how do we solve the traffic jam problem in Delhi, Bangalore, Mumbai, etc, that should be primary.

The other chapters mean what they are meant to be — statistics. The economic survey is a pre-budget document that has shown us what the vision of the government is on the fiscal side, which is promising but should not be a mere lip service.