Economic Survey: India's Growth Momentum Strong, Deregulation Crucial for Long-Term Success

• The Economic Survey projects India's GDP growth between 6.8-7.2% for FY 2026/27, showing strong momentum in services and manufacturing.
• It emphasizes deregulation—easing laws and processes—as key to fueling India's long-term growth, a term used 35 times in the survey.
• Challenges include states' worsening fiscal math due to unconditional cash transfers and falling revenue receipts, leading to higher combined government debt (81%).
• Rigid labor codes and inefficient liquidation laws are identified as major hurdles, hindering firm scaling-up and innovation.
• The survey highlights misallocation of capital, with consumer loans rising and industrial loans falling, impacting productivity.

Why It Matters: India shows strong growth, but deregulation, labor reforms, and capital reallocation are vital for sustained long-term prosperity.