When Union Finance Minister Nirmala Sitharaman tabled the Economic Survey for FY26, she did more than present a government report card. She laid out a data-backed rebuttal to a growing chorus of geopolitical grumbling—much of it emanating from Washington—that would have the world believe India’s economy is somehow “dead.” The Survey’s numbers tell a very different story: one of resilience, reform, and a country steadily consolidating its position as the world’s fastest-growing major economy. Let’s begin with the facts. The Survey revises India’s medium-term growth potential upward to 7%, from the earlier 6.5%. Real GDP growth for FY26 is pegged at 7.4%, marking the fourth consecutive year India has led the global growth league among major economies. Domestic demand remains the backbone of this expansion, with private consumption accounting for 61.5% of GDP—the highest share since FY12. Investment, too, is holding firm, with Gross Fixed Capital Formation steady at 30% of GDP, driven by record public capital expenditure and a long-awaited revival in private sector confidence. Contrast this with the United States, currently trudging along at under 2% growth, grappling with stubborn inflation, fiscal stress, and political uncertainty. Yet it is from this position of economic deceleration that President Donald Trump chose to brand India a “dead economy”—a line as dramatic as it is detached from reality. The timing of that outburst was hardly coincidental. It followed India’s firm refusal to accept external mediation in the aftermath of the Pahalgam terror attack, which claimed the lives of 26 innocent tourists, including a newly married couple on their honeymoon. Operation Sindhoor, the three-day military response that followed, dismantled 11 terror hideouts, struck two major terror group headquarters, and targeted key Pakistan Air Force facilities. The strikes reportedly extended to sites alleged to be linked to strategic nuclear assets—facilities believed by many analysts to be part of a broader US geopolitical architecture in the region, aimed at counterbalancing China and Russia. In that context, the “dead economy” jibe appears less like an economic assessment and more like a geopolitical retort—frustration wrapped in rhetoric. What is more puzzling, and frankly more troubling, is the eagerness with which this narrative was echoed at home. Rahul Gandhi, the Congress party’s leader in the Lok Sabha, chose to parrot the same phrase, lending domestic political voice to an external talking point that runs counter to virtually every credible global financial forecast. When opposition leaders align themselves with foreign derision rather than national data, the question that arises is not about dissent—it is about discernment.
The Economic Survey’s fiscal and monetary indicators further weaken the “dead economy” claim. Inflation has been tamed, with headline CPI dropping to a record low of 1.7% between April and December 2025, largely due to falling food prices. The Reserve Bank of India, responding to easing price pressures, cut the repo rate by 125 basis points since February 2025, supporting growth without stoking inflationary fears. On the fiscal front, the government has walked the talk of consolidation. The fiscal deficit has been brought down to 4.8% of GDP in FY25, with a target of 4.4% for FY26—effectively halving the gap from its pandemic-era peak. Global rating agencies have taken note. S&P upgraded India to BBB, alongside positive moves by Morningstar, DBRS, and R&I, marking the first major upgrade in nearly two decades. These are not symbolic gestures; they reflect international confidence in India’s macroeconomic management. The Survey is not blind to risks. It outlines scenarios ranging from “managed disorder” in a volatile global order to a low-probability but high-impact systemic shock. It flags vulnerabilities in capital flows, currency pressures from rising imports as incomes grow, and the dangers of monetary divergence in advanced economies. But even here, the conclusion is telling. Across all scenarios, India is positioned better than its Asian peers and the G7, anchored by a vast domestic market and stable foreign exchange reserves. This is not the language of economic decay. It is the language of cautious confidence. Economics, like geopolitics, is often a battlefield of narratives. Numbers, however, remain stubbornly apolitical. Growth rates, investment cycles, inflation trends, and sovereign ratings do not bend to presidential rhetoric or partisan echo chambers. They respond to policy, performance, and perception in global markets. India today stands at an inflection point—assertive in its security posture, ambitious in its economic reforms, and increasingly unwilling to outsource its strategic decisions. The Economic Survey for FY26 reflects that reality: a nation navigating external turbulence with internal strength. In that light, the real question is not whether India’s economy is “dead.” It is why, in the face of robust data and global validation, some are so invested in declaring it so.
