Amid the evolving global developments and the recent trade and tariff-related uncertainties, India’s domestic economy continues to show signs of stability and resilience, said the Finance Ministry’s review for March.
Key indicators such as higher GST collections and increased E-way bill generation in Q4 FY25 suggest steady growth in economic activity, said the report.
“Consumer sentiment has shown improvement, with RBI’s latest survey reflecting a more positive outlook on current conditions and future expectations. Rural demand remains steady, with the majority of households surveyed by NABARD reporting increased consumption over the past year. The manufacturing sector is also seeing a revival.”
As things stand, as per the report, geopolitical tensions, disruptions to supply chains, tariffs, and trade-related uncertainties are posing downside risks to global growth.
The escalating trade tensions and tariff wars have led to “apprehensions” of the global economy facing higher inflation and lower economic growth in the near term, the report said.
“Amidst this turbulence, it is imperative for India to nurture domestic policy and regulatory environments that is conducive for capital formation, hiring and output growth.”
The Finance Ministry said, despite the risk posed by global headwinds, the domestic economy continues to show signs of resilience backed by domestic drivers.”High-frequency indicators suggest the domestic economy’s robust performance in the last quarter of FY25. Gross GST collection jumped to 1.96 lakh crore in March 2025 on the back of buoyant economic activity. GST collection rose to ₹22.1 lakh crore in FY25 (Apr-Mar), compared to ₹20.2 lakh crore in FY24, recording a year-on-year (YoY) growth of 9.4 per cent. Complementing this, the E-way bill generation recorded growth of 20.2 per cent in March 2025.”
India’s manufacturing Purchasing Managers’ Index (PMI) reached its highest mark in eight months in March 2025, signalling a substantial improvement in the sector, noted the ministry.
“Overall demand momentum remained robust, and the new orders index also recorded an eight-month high. Business expectations remained fairly optimistic, with around 30 per cent of survey participants foreseeing greater output volumes in the year ahead.”
The Ministry in it report further said, private consumption is gaining strength, with rural demand emerging as a key driver. As per Neilsen IQ, during Q3 of FY25, fast-moving consumer goods posted volume growth of 9.9 per cent in rural India as compared to 5.7 per cent in Q2 of FY25. Urban consumption also picked up pace, with volume growth rising to 5.0 per cent in Q3 FY25.
