|Economic Survey 2026 Live Updates: Domestic Demand Continues To Anchors India’s Growth, ..Says CEA Nageswara
Nirmala Sitharaman presents the Economic Survey for FY26 in Parliament, with V. Anantha Nageswaran set to brief media on key findings ahead of the Union Budget 2026–27.
Ahead of the Union Budget 2026–27, Finance Minister Nirmala Sitharaman has tabled the Economic Survey for FY26 in the Parliament. The Survey will present a comprehensive review of the Indian economy, covering trends in growth, inflation, fiscal position, employment, credit, trade and the external sector, and is expected to shape the policy direction of the upcoming Budget.
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Economic Survey: Digital addiction, for the first time has been elevated to a national public‑health concern. The document warns that India is witnessing a surge in behavioural‑health risks linked to excessive screen time, social‑media overuse, and technology‑driven compulsions—especially among adolescents.
What exactly is the Economic Survey?
The Economic Survey is an annual publication prepared by the Department of Economic Affairs in the Ministry of Finance, under the guidance of India’s Chief Economic Adviser (CEA). It takes a deep dive into how the Indian economy fared in the previous financial year, backed by data, trends, and analysis.
Who Prepares the Economic Survey?
The Economic Survey is prepared by the Economic Division of the Department of Economic Affairs, Ministry of Finance, under the guidance of the Chief Economic Advisor (CEA) to the Government of India.
It represents the official institutional assessment of the economy and reflects the Government’s macroeconomic thinking, policy priorities, and reform philosophy.
Why the Economic Survey 2026 Matters?
The Economic Survey 2026 occupies a unique place in India’s policy ecosystem because it
Provides an authoritative overview of the Indian economy
Explains why certain policy choices are being made
Flags structural bottlenecks and reform needs
Economic Survey 2026 Live Updates
Ahead of the Union Budget 2026-27, Sitharaman will table the Economic Survey 2025-26 in Parliament today
mmmmmCredit flows from non-bank financial companies (NBFCs) (net of bank borrowings), to the commercial sector grew at a robust compound annual growth rate (CAGR) of 43.3 per cent during FY20 to FY25, significantly outpacing the 25 per cent CAGR recorded for non-food bank credit over the same period.4
This evolving landscape has been further strengthened by the growing role of Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs), which are enabling long-term institutional capital to participate in infrastructure assets.
Credit flows from non-bank financial companies (NBFCs) (net of bank borrowings), to the commercial sector grew at a robust compound annual growth rate (CAGR) of 43.3 per cent during FY20 to FY25, significantly outpacing the 25 per cent CAGR recorded for non-food bank credit over the same period.4
This evolving landscape has been further strengthened by the growing role of Infrastructure Investment Trusts (InvITs) and Real Estate Investment Trusts (REITs), which are enabling long-term institutional capital to participate in infrastructure assets.
The Centre has significantly strengthened the
regulatory enforcement framework for the insurance sector by raising the maximum penalty for violations by insurers tenfold, from Rs 1 crore to Rs 10 crore, while also empowering the regulator to order disgorgement of wrongful gains, according to the Economic Survey 2025-26.
In 2025, gold was not just a hedge; it was an outperformer. While equities rose and credit stress eased, gold delivered superior returns, underscoring its role as the preferred asset when investors stayed cautious despite calmer bond markets.
Manoj Mishra, Partner and Tax Controversy Management Leader, Grant Thornton Bharat, said: “The Economic Survey 2025–26 reinforces the growing maturity of indirect taxes, with GST firmly established as a stable and growth-aligned revenue pillar. Gross GST collections of INR 17.4 lakh crore during April–December 2025, with a 6.7% YoY growth, underscore revenue resilience despite lower inflation and calibrated rate rationalisation, driven largely by compliance-led buoyancy.
The expansion of the taxpayer base to over 1.5 crore and a 21% YoY growth in e-way bill volumes reflect deeper formalisation of the economy. On customs front, 7.3% YoY moderation in collections mirrors calibrated duty reductions on raw materials and essential goods to support domestic manufacturing and manage input costs, while excise duty collections have moderated to about 0.9% of GDP due to conscious policy choices on petroleum taxation.
Importantly, the survey clearly outlines the next wave of GST reforms reimagining the e-way bill system as a facilitator of seamless logistics rather than a pure enforcement tool. A shift towards trust-based, technology-driven compliance, including risk-based checks, use of e-seals and vehicle-tracking technologies, could significantly deregulate logistics, reduce trade friction, and enhance ease of doing business without compromising tax oversight.”
Economic Survey 2026 News: The Government of India’s capital outlay has increased by nearly 89 per cent, from ₹5.92 lakh crore in FY22 to a budgeted allocation of ₹11.21 lakh crore for FY26, recognising the strong multiplier effects that infrastructure generates on the economy.
CEA said core inflation remains under control after excluding gold and silver, and benign price trends are likely to persist next year as well.
He added that India’s growth performance stands out compared with other major economies globally.
On the external front, the CEA noted that India’s import cover has risen to nearly one year, the current account balance remains comfortable, and external debt has declined to 19.2% from 23.8% last year.
CEA: The flow of resources to the non-government or the
commercial sector, including households and businesses remain adequate. The annual growth rate in the last five years has been 29%, that is ample resource availability in the system for economic activity and investment spend.
CEA: The banning of online gaming does matter for mental health and also for your wallets health.
CEA: The next wave of GST reforms could, therefore, focus on reimagining the e-Way Bill system as a facilitator of smooth logistics rather than only as a tool for enforcement and control, in line with the changing needs of businesses and supply chains.
In FY26, FDI has been on the weaker side, partly because of profit taking by investors who have invested in the earlier decades.
Because of the compulsion that Indian businesses face to invest overseas.
So as a result, net FDI numbers are not where you would want them to be.
CEA: Geopolitical tensions are inevitable. Uncertainties are higher now since the start of the millennium. Gold prices are not only responding to global uncertainties, but also the value of Fiat currency
Madhavi Arora, Chief Economist, Emkay Global Financial Services said that the FY26 Economic Survey focuses on sustaining high growth through fiscal consolidation, contained inflation, and financial-sector resilience, while flagging external vulnerabilities arising from current account deficits and currency pressures.
“The Survey emphasises the need for manufacturing-led exports, deeper integration into global value chains, and lower structural cost of capital to strengthen external resilience. It also stresses infrastructure expansion, deregulation, and enhanced state capacity—an “entrepreneurial state”—alongside priorities on skilling, employment, climate-resilient growth, and AI-led transformation to raise India’s potential growth to around 7%.”
Growth holding up but risks are elevated” CEA V. Anantha Nageswaran said. He added that investor reluctance to commit to India warrants examination
United States President Donald Trump is at loggerheads with Federal Reserve Chair Jerome Powell, the latter of whom has now been subpoenaed by the Justice Department (DoJ).
However, he also argued that the investigation must be understood within the broader political context of ongoing pressure from the White House over interest rates and control of monetary policy.
“But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure” for lower interest rates and greater influence over the Fed, Powell said.
He went further, asserting that the focus on his congressional testimony and the renovation project was not the real motivation behind the subpoenas.
At the centre of the controversy is Powell’s testimony to the Senate Banking Committee regarding the Federal Reserve’s $2.5 billion renovation of two office buildings in Washington, DC.
The grand jury subpoenas issued have been linked to that testimony, a move Powell has described as an attempt to pressure the Fed into following the White House’s preferred monetary policy.
“On Friday [January 9, 2026], the Department of Justice served the Federal Reserve with grand jury subpoenas, threatening a criminal indictment related to my testimony before the Senate Banking Committee last June,” Powell said.
The testimony in question addressed cost overruns in a $2.5 billion project to renovate two Federal Reserve office buildings in Washington. Trump has repeatedly criticised the project, describing it as excessive.
Powell highlighted that he respects legal oversight and accountability, stating, “I have deep respect for the rule of law and for accountability in our democracy. No one — certainly not the chair of the Federal Reserve — is above the law.”
However, he also argued that the investigation must be understood within the broader political context of ongoing pressure from the White House over interest rates and control of monetary policy.
“But this unprecedented action should be seen in the broader context of the administration’s threats and ongoing pressure” for lower interest rates and greater influence over the Fed, Powell said.
He went further, asserting that the focus on his congressional testimony and the renovation project was not the real motivation behind the subpoenas.
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“This new threat is not about my testimony last June or about the renovation of the Federal Reserve buildings. It is not about Congress’s oversight role…Those are pretexts. The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”
“The Attorney General has instructed her US Attorneys to prioritise investigating any abuse of taxpayer dollars,” a DoJ spokesperson said.
How Trump has been targeting Powell
Trump publicly distanced himself from the Justice Department’s actions, saying he was unaware of the subpoenas issued to the Fed.
“I don’t know anything about it, but he’s certainly not very good at the Fed, and he’s not very good at building buildings,” Trump said in an interview with NBC News.
When asked whether the investigation was intended to pressure Powell on interest rates, Trump replied, “No. I wouldn’t even think of doing it that way.”
Despite this denial, Trump has long criticised Powell’s leadership of the Federal Reserve and has repeatedly called for deeper and faster interest-rate cuts.
A Yars intercontinental ballistic missile is launched during a test from the Plesetsk Cosmodrome in the Northern Arkhangelsk region, Russia. (Representative Image, Credit: Reuters)
Since returning to office an year ago Trump has argued that the Fed’s policies have constrained economic growth and kept borrowing costs higher than necessary.
Trump has also publicly floated the idea of firing Powell, despite legal protections designed to shield the Fed chair from political dismissal.
How Trump has been building a case against Powell
The dispute between Trump and Powell did not emerge suddenly. Trump appointed Powell as Fed chair during his first term, and Powell later received a second appointment under US President Joe Biden. Powell
has led the central bank since 2018.
During Trump’s second term, the relationship deteriorated as inflation pressures and economic conditions shaped the Fed’s policy decisions. Trump has consistently pushed for sharper rate reductions, arguing that lower borrowing costs would support economic growth, housing affordability, and business investment.
The Federal Reserve, however, has maintained that interest-rate decisions must be guided by economic data, inflation trends, and employment conditions rather than political demands.
Powell pointed this out in his recent remarks, saying, “The threat of criminal charges is a consequence of the Federal Reserve setting interest rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”
“This is about whether the Fed will be able to continue to set interest rates based on evidence and economic conditions — or whether instead monetary policy will be directed by political pressure or intimidation.”
Earlier in the year, the Fed had taken a more cautious approach in responding to Trump’s criticism, largely avoiding direct confrontation.
In some cases, it even adjusted its policy focus, including scaling back efforts to incorporate climate-change risks into banking supervision — a move that aligned with the administration’s priorities.
Even if Powell is replaced as chair, he can remain on the Fed’s Board of Governors until 2028, preserving his influence over monetary policy.
How US lawmakers & economists have reacted
The Justice Department’s involvement in the dispute has alarmed some members of Congress, including Republican Senator Thom Tillis, who sits on the Senate Banking Committee.
Tillis said the threatened indictment raised serious questions about the Justice Department’s credibility and political neutrality. In response, he announced that he would block any Trump nominees to the Federal Reserve — including a future chair — until the legal matter involving Powell is resolved.
The Senate Banking Committee plays a key role in vetting presidential nominees to the Federal Reserve, giving Tillis and his colleagues significant influence over the central bank’s future leadership.
Peter Conti-Brown, a Federal Reserve historian at the University of Pennsylvania, told Reuters,
“The inquiry into Powell is a low point in Trump’s presidency and a low point in the history of central banking in America.”
“Congress did not design the Fed to reflect the president’s daily fluctuations, and because the Fed has rebuffed President Trump’s efforts to take the Fed down he is launching the full weight of American criminal law against its Chair.”
The Federal Reserve was structured to operate independently from day-to-day political influence so that interest-rate decisions could focus on long-term economic stability, inflation control, and employment conditions rather than electoral considerations.
The current conflict has raised questions about whether those institutional safeguards are being tested more severely than at any point in recent history.
How markets reacted
In the United States, futures contracts pointed to a weaker open, with the S&P 500 down 0.6 per cent, the Dow Jones Industrial Average off 0.5 per cent, and the Nasdaq composite falling 0.9 per cent.
Asian markets, however, moved higher on Monday. Hong Kong’s Hang Seng Index rose 1.2 per cent to 26,547.64, while China’s Shanghai Composite climbed 1 per cent to 4,163.11 after reports that Chinese leaders were preparing additional economic support measures.
South Korea’s Kospi gained 0.8 per cent to 4,624.79, Australia’s S&P/ASX 200 advanced 0.5 per cent to 8,759.40, and Taiwan’s Taiex rose 0.9 per cent. Tokyo’s stock market was closed for a holiday.
Currency movements were modest. The US dollar remained near 158.02 yen against the Japanese currency, while the euro strengthened to $1.1671 from $1.1635.
Commodities saw sharper shifts. Gold prices climbed 1.9 per cent, silver surged 6.4 per cent, and copper gained 1.4 per cent, reflecting increased demand for assets traditionally viewed as hedges during periods of uncertainty.
US crude oil rose to $59.20 per barrel, while Brent crude increased to $63.43.
Despite the political drama, US markets had ended the previous week at record highs. The US Labour Department reported that employers hired fewer workers in December than economists had expected, while the unemployment rate improved.
How Trump is also vying to remove Cook
Parallel to the Powell controversy is Trump’s effort to remove Fed Governor Lisa Cook — a move without precedent in modern US history.
Cook
has challenged her dismissal in court, and judges have ruled that she can remain in her position while the case proceeds. The Supreme Court is scheduled to hear arguments on January 21.
The timing is significant. Powell disclosed the subpoenas roughly two weeks before the Supreme Court is set to consider Cook’s case.
Federal Reserve Board of Governors member Lisa Cook, right, talks with Federal Reserve Chairman Jerome Powell before an open meeting of the Board of Governors at the Federal Reserve, June 25, 2025, in Washington. File Image/AP
Trump’s efforts against both Powell and Cook have reinforced concerns that the Federal Reserve’s leadership is being targeted for resisting political influence over monetary policy.
The Federal Reserve’s influence extends far beyond the United States. Its interest-rate decisions shape global capital flows, currency markets, and borrowing costs worldwide.
Concerns that the Fed’s independence could be compromised may affect investor confidence in US Treasury securities, which are widely viewed as one of the safest assets in the world.
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