India’s Parliament has acknowledged that economic growth in today’s world will be slower, riskier, and more contested than in the past. This explainer examines how lawmakers see India’s growth prospects amid global trade fragmentation, tariff uncertainty, energy transition pressures, fiscal constraints, and technological disruption—and where the roadmap still falls short of execution.
New Delhi (ABC Live): India’s Parliament is not reading growth as a straight-line story. Instead, the Standing Committee on Finance frames India’s next decade as a test of resilience—because global trade is fragmenting, tariffs are rising, supply chains are re-wiring, and climate and technology shocks are tightening policy choices. In that setting, Indian Parliament economic growth fractured global order becomes less about headline GDP and more about the plumbing: investment, credit-deposit stability, energy security, MSME competitiveness, jobs, and the capacity to innovate at scale.
This report-based explainer reads the Committee’s “roadmap” as Parliament’s attempt to convert uncertainty into a domestic-growth strategy.
However, it also flags where the roadmap stays descriptive, where it turns prescriptive, and where implementation risk can quietly dilute outcomes.
Data Box: Parliament’s Growth Snapshot
- FY2024–25 GDP (current prices): ₹330.68 lakh crore
- FY2024–25 real GDP growth: 6.5%
- Private consumption share of nominal GDP: 60.2% → 61.4% (FY2023–24 to FY2024–25)
- Investment (GFCF) growth (constant prices): 7.1% (FY2024–25)
Why it matters: Parliament is implicitly betting that a large domestic market can absorb external shocks—if jobs, credit stability, and energy reliability keep pace.
1) What Parliament Is Actually Saying
The Committee’s core message is simple: the world that enabled older “export escalator” stories has weakened. Consequently, India’s roadmap must anchor on domestic demand, stronger macro fundamentals, and execution-heavy reforms across land–labour–capital and regulation. At the same time, the report accepts a hard constraint: faster growth needs higher investment, but higher investment can widen external financing needs in a world that is less predictable.
identifies system bottlenecks (credit-deposit gap, storage costs, MSME liquidity). It is weaker where it relies on scheme lists without hard delivery metrics.
2) Trade in a Tariff World: Opportunity, but Not a Free Lunch
The report treats trade uncertainty as structural, not temporary. It points to shifting tariff regimes, retaliatory dynamics, and supply-chain reconfiguration. Therefore, it positions India as a “balanced” economy: not over-dependent on exports, yet capable of capturing relocation opportunities in select sectors such as electronics and pharma.
For a deeper ABC Live trade context, see:
Explained: India’s Trade Performance 2025
.
For the original parliamentary report listing, see:
Sansad eLibrary record
.
Table: Top Export Destinations (FY2024–25, Provisional)
| Rank | Destination | Exports (US$ bn) | YoY Growth (%) | Share (%) |
|---|---|---|---|---|
| 1 | USA | 86.51 | 11.59 | 19.78 |
| 2 | UAE | 36.64 | 2.84 | 8.38 |
| 3 | Netherlands | 22.76 | 1.75 | 5.20 |
| 4 | UK | 14.55 | 12.08 | 3.33 |
| 5 | China | 14.25 | -14.49 | 3.26 |
alone accounts for ~one-fifth of exports. Therefore, diversification and competitiveness matter more than celebratory “all-time highs.”
3) Fiscal Strategy: Capex Push, but States Carry Hidden Pressure
The report repeatedly links growth to investment quality. It highlights capex expansion and the use of Special Assistance to States for Capital Investment (SASCI). At the same time, it acknowledges a real constraint: debt paths and fiscal rules can narrow room for error if a shock hits.
Table: SASCI Releases to States (₹ crore)
| Year | Amount |
|---|---|
| 2020–21 | 11,830 |
| 2021–22 | 14,186 |
| 2022–23 | 81,195 |
| 2023–24 | 1,09,554 |
| 2024–25 | 1,49,484 |
| 2025–26 (BE) | 1,50,000 |
project selection, land clearances, and state capacity lag. Therefore, the next policy upgrade must treat execution as the binding constraint.
4) Banking & Credit: Parliament Flags a Quiet Liquidity Risk
One of the sharpest parts of the Committee’s recommendations targets a structural mismatch: credit growth can outpace deposit mobilisation.
Even when liquidity ratios remain above regulatory minimums, the funding gap can raise costs, push banks towards expensive wholesale funding,and create asset–liability stress over time.
Data Box: Credit–Deposit Gap (SCBs)
- YoY credit growth: 11.0%
- YoY deposit growth: 10.7%
- LCR: 132.6% (above 100% minimum)
- NSFR: 126.3% (above 100% minimum)
Parliament’s warning: the gap can become a medium-term risk even when current ratios look comfortable.
What the Committee Recommends
- Boost deposit mobilisation using digital initiatives and innovative savings products.
- Strengthen risk management for FX exposure, ECB risks, and cyber vulnerabilities.
- Expand scenario stress testing to NBFCs and cooperative banks for system-wide resilience.
5) Energy Transition: Parliament Treats Storage and Minerals as Growth Constraints
The Committee supports a calibrated transition: expand renewables, but do not ignore intermittency, storage costs, and critical mineral concentration. Therefore, it pushes a diversified strategy—renewables plus nuclear (including SMRs), green hydrogen, and faster storage buildout through BESS and pumped storage projects.
Data Box: Energy Transition — Parliament’s Priority Stack
- Problem: Intermittency + high storage costs + concentrated critical minerals.
- Supply security: Strengthen mineral supply chains through NCMM and partnerships.
- Grid reliability: Scale BESS via VGF and accelerate PSP development.
- Firm clean power: Move nuclear (SMRs) and green hydrogen from “plans” to execution pipelines.
Critical reading: Parliament is quietly redefining energy policy as industrial policy. If storage and minerals remain fragile,
then electrification, EV scaling, and clean manufacturing can face bottlenecks. Therefore, the growth story now depends on supply-chain statecraft as much as on megawatts.
6) MSMEs & Jobs: The Committee Moves from Praise to Pressure
The report calls MSMEs the backbone of the economy, but it also identifies a real failure mode: liquidity stress, delayed payments, and compliance burdens can kill smaller firms quietly. Consequently, Parliament’s recommendations focus on cheaper working capital, smarter rules, and digital market access.
Data Box: MSME Credit Signal (Banking)
- Share of MSME credit in non-food bank credit: 17.7% (as of March 2025)
- MSME credit growth (FY2024–25): 14.1%
Table: Parliament’s MSME Fix — What Changes if Implemented
| Problem Parliament Flags | Committee Recommendation | Why It Matters |
|---|---|---|
| High-cost liquidity on receivables | Strengthen TReDS/EBF; review high rates (approaching ~18%); raise competition/benchmarks | Working capital decides survival for small firms; lower rates raise productivity |
| Strict NPA norms may hit vulnerable MSMEs | Conduct comparative study: MSMEs vs large corporates; consider differentiated supports | Data-led calibration avoids MSME closures without weakening discipline |
| Weak market access and tech adoption | Scale Udyam/GeM/SAMADHAAN; deepen corporate/export linkages; cluster and e-commerce support | Digitisation can convert “small” into “scalable,” improving exports and jobs |
| Few SMEs list and scale via markets | Encourage SME IPOs with simpler norms, better post-listing liquidity, and awareness programs | Patient capital supports manufacturing depth and job creation |
ABC Live take: Parliament’s MSME section matters because it treats employment as a firm-level outcome. If MSMEs cannot finance receivables cheaply, then “Make in India” becomes a slogan without balance-sheet oxygen.
7) Labour, Skilling, and AI: Parliament Adds a New Risk Lens
Parliament acknowledges rising female participation and expands the discussion to AI disruption. Consequently, it pushes for a Labour Market Information System (LMIS), benchmarks for LFPR aligned to “Viksit Bharat 2047,” and agile, modular skilling that industry co-designs.
Data Box: Female Labour Force Participation
FLFPR increased from 23.3% (2017–18) to 41.7% (2023–24). Parliament credits a mix of credit, skilling,
enterprise, and mission-mode schemes—and then asks for deeper institutional support.
What Parliament Wants Next
- Upgrade ITIs and skill centres in Tier-2 and Tier-3 cities, and align curriculum with real labour demand.
- Build AI skilling that is multilingual and access-aware, so it reduces disparities instead of widening them.
- Create an LMIS to close the “jobs data gap” that weakens policy targeting.
8) Innovation: Parliament Admits India Under-Spends on R&D
The report makes an unusually blunt admission: India’s R&D spending is far below global levels. Therefore, Parliament highlights a large RDI push with a ₹1 lakh crore allocation to crowd in private research, fund higher-TRL projects, and seed deep-tech financing.
Data Box: R&D Gap
- Global R&D spend: ~2.7% of world GDP
- India R&D spend: ~0.65% of GDP
- RDI scheme scale: ₹1 lakh crore (strategic and sunrise domains)
Critical reading: Parliament is right to treat R&D as economic security. Yet, money alone is not enough. India also needs faster
procurement, better IP-to-market pipelines, and predictable regulation so deep-tech can scale without policy whiplash.
ABC Live Editorial Note
Parliamentary reports often read like “policy catalogues.” ABC Live treats this one differently: it is a map of what the State thinks can break first in a fractured global order—liquidity, storage, MSME cashflow, and jobs under AI shock. The strongest value here is not the scheme list. It is the Committee’s insistence on system fixes: deposit mobilisation, BESS/PSP execution, receivables financing reform, and measurable labour-market intelligence. If Ministries convert these into delivery dashboards with deadlines, the roadmap becomes actionable. If they do not, the roadmap risks staying aspirational.
Conclusion: Parliament’s Roadmap Is a Resilience Test
Parliament’s reading is clear: India can sustain high growth even when the world fragments—if the economy solves internal constraints faster than external risks grow. Therefore, the real test is execution discipline: stable funding for credit, reliable energy storage, cheaper MSME liquidity, and skills that match the next labour market.
problem—and that framing is the most important takeaway.
Verified Sources
- Standing Committee on Finance (2024–25), Twenty-Sixth Report:
Sansad eLibrary record - ABC Live internal explainer:
Explained: India’s Trade Performance 2025
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