The Indian economy is poised to remain the fastest-growing major economy in FY26 by leveraging its sound macroeconomic fundamentals, robust financial sector and commitment towards sustainable growth, according to a State Bank of India (SBI) report.

With higher anticipated saving based on latest RBI annual report, the domestic finances will be sufficient to finance the anticipated growth and “we do not expect demand induced pressure on prices in FY26,” said Dr Soumya Kanti Ghosh, Group Chief Economic Adviser, SBI.

The downside to growth emanate from external and geopolitical factors, Ghosh added.

From the expenditure side, the GDP growth of 7.4 per cent in Q4 was supported by strong uptick in the capital formation which registered a 9.4 per cent annual growth.

The recovery in capital formation was on account of revival in core sector in Q4 as evident from high frequency indicators. The overall growth in capital formation for FY25 now stands 7.1 per cent.

India’s economy has maintained a steady growth trajectory, with real GDP expanding by 6.5 per cent in FY 2024-25, largely driven by healthy growth in private consumption and capital formation, industry leaders said on Friday.

In nominal terms, GDP grew by 9.8 per cent, highlighting India’s position as one of the fastest-growing major economies globally, said Hemant Jain, President, PHDCCI.

The Private Final Consumption Expenditure (PFCE) increased by 7.2 per cent, while Gross Fixed Capital Formation (GFCF) rose by 7.1 per cent in Q4, reflecting investment-led momentum.

“GVA growth in Q4 was led by 10.8 per cent growth in construction sector followed by public administration and defence-related services at 8.7 per cent,” Jain noted.

At the prestigious Ideas for India Conference 2025 held at the Royal Lancaster London, AAP Rajya Sabha MP Raghav Chadha delivered a blistering address that tore through the global narrative of Pakistan as a victim, declaring it instead as a state sponsor of terror. Invited by the UK-based think tank Bridge India as a featured speaker alongside top Indian business leaders and policymakers, Raghav Chadha used the international stage to demand a decisive shift in global policy: “Diplomacy fails with duplicity, and terror nullifies tolerance,” he declared.

Raghav Chadha warned the global community that continued aid to Pakistan enables violence, not peace. “We offer a hand of friendship—but it can turn into a fist of retribution if provoked,” he said, making clear that India’s patience is not limitless in the face of cross-border aggression.

India's GDP growth accelerated to a robust 7.4 per cent in the fourth quarter of 2024-25, as result of which the growth rate for the full financial year works out to 6.5 per cent on the back of a strong performance of the agriculture, construction, and services sectors, official data released on Friday showed.

The agriculture sector recorded a 4.6 per cent growth rate during 2024-25, up from 2.7 per cent in 2023-24 when an erratic monsoon had damaged crops. During Q4, FY 2024-25, the growth rate of the agriculture sector jumped to 5 per cent compared to 0.8 per cent in Q4 of the previous financial year, figures compiled by the Ministry of Statistics showed.

The construction’ sector is estimated to have registered an impressive growth rate of 9.4 per cent in FY 2024-25, followed by 8.9 per cent growth rate in the ‘Public Administration, Defence & Other Services’ sector while the ‘Financial, Real Estate & Professional Services’ sector posted a 7.2 per cent growth for the financial year.

The Indian stock market closed lower in Friday's trading session. At the end of trading, the Sensex was down 182.01 points or 0.22 per cent at 81,451.01 while the Nifty was down 82.9 points or 0.33 per cent at 24,750.70.

Midcap and smallcap closed almost flat. The Nifty Midcap 100 index closed down 37.25 points at 57,420.00 and the Nifty Smallcap 100 index closed down 6.10 points at 17,883.30.

Metal and IT stocks led the decline. Nifty Metal index closed down by 1.69 per cent and Nifty IT index down by 1.15 per cent. Apart from this, auto, pharma and FMCG sectors also saw a decline. Only PSU bank, financial services and media indices closed in the green.

The Nifty remained volatile with a slightly negative bias on the first day of the June series. On the smaller time frame, the index has formed a bearish moving average crossover.

Net financial savings of India’s household sector may reach Rs 22 lakh crore or 6.5 per cent of gross national disposable income (GNDI) in FY25 based on the current trends, according to an SBI report released on Friday.

With the latest RBI annual report indicating that the household sector showed strong financial resilience, with net savings rising to 5.1 per cent of gross national disposable income (GNDI) in FY24, the SBI report says this growing capital pool remains crucial for funding government and corporate deficits and supporting macroeconomic stability.

Further, as against the increase in household liabilities to 6.1 per cent of GNDI, the gross financial savings of households increased to 11.2 per cent of GNDI in 2023-24 from 10.7 per cent in the previous year.

The Finance Ministry said on Friday it has suggested that the Reserve Bank of India (RBI) should exclude small borrowers of up to Rs 2 lakh from the provisions of its draft directions on lending against gold collateral. The Finance Ministry has also suggested that the implementation of the guidelines be postponed to next year.

“The draft directions on lending against gold collateral issued by the RBI have been examined by the Department of Financial Services (DFS) under the guidance of Finance Minister Nirmala Sitharaman. The DFS has given suggestions to the RBI to ensure that the requirements of the small gold loan borrowers are not adversely affected,” the Finance Ministry said in a statement on X.

DFS has also stated that such guidelines will need time to implement at the field level and hence may be suitable for implementation from January 1, 2026 only, the statement said.

Indian shrimp exporters will see a marginal 2-3 per cent uptick in revenues this fiscal (FY26) on improved realisations stemming from rising prices and currency gains, a Crisil report said on Friday.

Though the low-value-added shrimp exports will likely see increased pressures, Indian exporters have a competitive advantage in the value-added segment over other Asian peers, such as China, Vietnam, Thailand and Indonesia, which face higher tariffs but enjoy over one-third market share in the US.

However, export volumes will be flat because of higher tariffs expected to be imposed by the US and subdued demand in key importer nations as sluggish economic growth affects disposable incomes.

The country’s defence production is expected to surge over six-fold to Rs 8.8 lakh crore in 2047 from Rs 1.46 lakh crore in 2024-25, according to a report compiled by the Confederation of Indian Industry (CII) and KPMG India.

India’s annual defence budget could increase around five-fold to Rs 31.7 lakh crore in 2047, from Rs 6.81 lakh crore currently allocated for financial year 2025-26.

The report — titled “Atmanirbhar, Agrani, and Atulya Bharat 2047” — released at the CII annual business summit here, estimates India’s defence exports to rise to Rs 2.8 lakh crore in 2047, which represents a nearly 12-fold jump compared to the corresponding figure of Rs 24,000 crore for 2024-25.

The report pegs the country’s total defence expenditure at 4.5 per cnet of GDP for 2047, up from 2 per cent of GDP at present.

The domestic benchmark indices opened flat on Friday amid negative Asian cues, as selling was seen in the IT and auto sectors in the early trade.

Stable institutional flows — both FII and DII — are keeping the market steady even in the absence of positive triggers. The ongoing consolidation phase is likely to continue in the near-term, according to analysts.

At around 9.29 am, Sensex was trading 11.77 points or 0.01 per cent up at 81,644.79 while the Nifty added 13.20 point or 0.05 per cent at 24,846.80.

Nifty Bank was up 81.20 points or 0.15 per cent at 55,627.25. The Nifty Midcap 100 index was trading at 57,707.65 after rising 250.40 points or 0.44 per cent. Nifty Smallcap 100 index was at 17,927.15 after climbing 37.75 points or 0.21 per cent.