5 min readJan 30, 2026 10:11 AM IST
First published on: Jan 30, 2026 at 07:34 AM IST
Economic Surveys (ES), prepared under the leadership of the Chief Economic Advisor (CEA), are meant to inform policymakers, businessmen and citizens on three key aspects of the government’s role in the economy and society, and in global economic engagement. First, a fair and objective assessment of the economy’s performance, both macroeconomic and sectoral. Second, a critical diagnostic of key issues facing the economy and suggested policy solutions. Third, an honest critique of budget performance, offering choices for course-correction.
Every CEA decides how much importance to give these objectives, adopting broadly one of three approaches: Objective, critical or propagandist. Arvind Subramanian introduced a new volume to present a critique on major issues. The government did away with it two years after he left. Krishnamurthy Subramanian’s surveys echoed the government, with a sprinkling of objective analysis.
V Anantha Nageswaran’s surveys have been more objective and balanced, albeit with a bias that shows the government in a better light; the 2025-26 Survey (ES-25) is his fourth. Besides a performance review, it discusses three major issues: The effectiveness of Swadeshi/import substitution strategy; input cost reduction strategy to build competitiveness; and progression to strategic indispensability in a fractured world.
Let’s begin with its take on GDP growth. On top of 7.4 per cent growth in 2025-26 (ES-25 had estimated between 6.3 per cent and 6.8 per cent), ES-26 projects GDP growth between 6.8 per cent and 7.2 per cent (7.0 per cent midway). On the face of it, this is a good performance. There is, however, a sombre side to it. India’s nominal GDP growth for 2025-26 is estimated at just 8 per cent. ES-26 does not explain why the difference between nominal and real is only 0.6 per cent. The worst part is that the rupee has depreciated by more than 6.5 per cent so far. An 8 per cent nominal GDP growth with 6.5 per cent rupee depreciation means dollar GDP growth of only 1.5 per cent!
This is amongst the lowest globally, with India having the highest real GDP and among the lowest levels of dollar GDP growth in the same year. Yet, Nageswaran offers no explanation, despite the jeopardy to the Prime Minister’s guarantee of making India the third-largest economy before the next Lok Sabha elections. He dismisses rupee depreciation as a “wrinkle in the ointment”, characterising India as a “victim of geopolitics and a strategic power gap”.
While Nageswaran rightly underlines the importance of analysing and learning from failures in Chapter 16, the ES-26 offers no analysis of even one government policy or programme failure. The government had announced three employment-linked -incentive schemes (ELIs) in the 2024-25 Budget to create more than 2 crore jobs and an ambitious incentive scheme for 1 crore internships. The internship scheme has been an abject failure with less than 10,000 youth interning in the last 18 months. ELIs are also creating questionable jobs. Nageswaran’s Survey offers neither a diagnostic nor advice for course-correction.
Manufacturing has been a major bugbear for India, stagnating at around 12-13 per cent despite programmes like Make In India, production-linked incentives (PLIs), etc. ES-26 only offers a static and favourable description of various programmes. PLIs have been hailed without explaining why they have not disbursed even 10 per cent in four years (out of their six years’ life) and why some big ones have not even started disbursing (e.g. ACC batteries, IT Hardware and automobiles).
The government’s fiscal performance came under stress in 2025-26, thanks to decisions like making incomes up to Rs 12 lakh tax-free and sacrificing GST by reducing tax rates on automobiles and consumer durables. The government has been restricting refunds to make tax growth not look too bad. ES-26 describes fiscal performance at great length but offers no insights on tougher issues.
Last year, Nageswaran offered sensible advice to policymakers to open up Chinese investment, at least in areas where Chinese companies have exclusive or predominant technological advantage, like solar cells. The advice was ignored. This year, he has couched similar advice in more arcane language: India needs to move from import substitution to strategic indispensability via strategic resilience. This would be easier to ignore, as no one will really understand what he is talking about. The fate of other advice he offers will be similar.
ES-26 will adorn bookshelves, instead of being read and discussed.
The writer is former Finance and Economic Affairs Secretary
