New Delhi, Feb 27 (PTI) The economic growth projection for next fiscal year is revised upwards by 20 basis points to 7-7.4 per cent and the GDP size will comfortably cross USD 4 trillion-mark during the year, Chief Economic Advisor V Anantha Nageswaran said on Friday.

The Economic Survey presented in Parliament in January had projected a growth rate of 6.8-7.2 per cent for fiscal year 2026-27.

Ministry of Statistics and Programme Implementation (MoSPI) is releasing the new series of annual and quarterly National Accounts Estimates with base year 2022–23, which replaces the previous series with base year of 2011–12.

"...we are improving our GDP growth outlook for FY27 from 6.8 to 7.2 previously to 7 to 7.4 per cent under the new series...the economy is more likely to achieve a number closer to 7.4 per cent rather than 7 per cent," Nageswaran said while addressing a press conference on the release of new series of national accounts or GDP.

He also said that based on current indicators, nominal GDP growth would be close to 11 per cent and the size of the economy would comfortably cross USD 4 trillion-mark in the next financial year.

Nageswaran also asserted that the Indian economy continues to maintain strong growth momentum, supported by broad-based activities.

As per the new series, GDP is likely to grow at 7.6 per cent during 2025-26, up from 7.1 per cent in the previous fiscal.

MoSPI Secretary Saurabh Garg said the main reason to change the base year was that the number of data sources has increased, and there was a need to properly incorporate these new data sources into GDP calculations.

Additionally, he said, there have been structural changes in the economy over the past 10 years, with significant growth in the digital economy, leading to the availability of various new data sources, such as GST and vehicle-related data.

"There have also been certain methodological changes. With the objective of 'data for development’, this base revision has been undertaken to ensure that the picture we present of the economy is accurate and reflects our progress correctly,” he said.

Speaking about the March quarter GDP growth, Nageswaran said, momentum in the economy is good enough to give a growth rate of 7.3 per cent or more during the period.

As per the second advance estimates, the Indian economy witnessed a growth rate of 6.7 per cent in Q1, 8.4 per cent in Q2 and 7.8 per cent in Q3.

All parameters are good enough to give growth rate of 7.6 per cent in FY26 as per the new series, he said, adding, most of high frequency data are maintaining good momentum.

On external side, he said, there in merchandise export in January reflecting the US trade related uncertainties.

Overall, he said, the outlook for the economy continues to maintain strong growth supported by broad-based activity.

Favourable supply-side conditions, including robust Rabi sowing, comfortable foodgrain stock and easing global commodity prices, are expected to keep inflation low and stable, he said.

He further said fiscal consolidation will be on track in the light of 2022-23 base year GDP revision.

With the nominal GDP being lower by roughly Rs 12 lakh crore, the estimated fiscal deficit for 2025-26 will now be 4.5 per cent, but other indicators, such as primary deficit, revenue deficit or effective capital expenditure or capital expenditure to GDP ratios are expected to remain unchanged.

The Budget presented earlier this month had projected fiscal deficit to be 4.4 per cent of the GDP for the current financial year ending March.

He hoped that successful trade agreements, including India-US and India-EU, will support exports and capital flows.

Nageswaran said that the per capita income has grown by 6.3-6.4 per cent in real terms in last three years. In nominal term, the growth rate would be about 3 percentage point higher.

Observing that India has recorded consecutive years of over 7 per cent GDP growth, he said the country has outperformed many economies facing high debt and slower expansion in the post COVID period.

Manufacturing has shown strong growth, agriculture’s share has edged up, and services have moderated slightly, he said, adding, investment remains resilient, private consumption is steady with strong rural demand, and the investment ratio has improved.

"Capital formation is robust, with machinery and equipment investment growing strongly, including over 10 per cent growth among unincorporated enterprises. With solid momentum in the first three quarters, achieving 7.6 per cent full year growth appears feasible," he added. PTI DP NKD DP ANU ANU