Virendra Pandit

New Delhi: Seven weeks before tabling her next Budget for the fiscal year 2026-27 in the Lok Sabha on February 1, 2026, Finance Minister Nirmala Sitharaman on Saturday said the government expects the Indian economy to expand by at least 7 percent in the current financial year (FY26).

Chief Economic Advisor Dr. Anantha Nageswaran had also upgraded his forecast in November to at least 7 percent after data showed the economy grew at 8.2 percent in the second quarter (July-September 2025). Economists also revised their predictions upward from 7 percent to 7.5 percent.

Speaking at an event in New Delhi, Sitharaman said India’s growth momentum is set to continue, the media reported.

The NDA government, led by Prime Minister Narendra Modi, had earlier projected 6.3 percent to 6.8 percent growth for 2025-26.

“We saw the growth numbers for the second quarter,” Sitharaman said, adding, “I think that will sustain, and, overall, this year’s growth numbers will be 7 percent or beyond it as well.”

She acknowledged that some degree of price rises was necessary to stimulate growth.

The Reserve Bank of India (RBI) cut the interest rate by 25 basis points to 5.25 percent on Friday and lowered its inflation forecast for the fiscal year from 2.6 percent to 2 percent, while raising its growth projection from 6.8 percent to 7.3 percent.

India also plans a complete overhaul of its customs duty structure, the FM said. “We need to have customs that is a lot more simplified for people to feel it is not too cumbersome to comply with the rules,” she said, adding that the rules should be more transparent.

Sitharaman, however, did not want to be drawn into the value of the rupee, which fell to a record of above 90 per US dollar this week, calling the topic “too sensitive.”

The currency will “have to find its own level,” she said.