India expects strong 7.4% GDP growth, but tax revenue lags behind

Business Jan 13, 2026

India's economy is set to grow by 7.4% in 2025-26, according to the government—an improvement over last year's pace.
But there's a catch: tax collections have dropped by 3.4% through November and haven't even reached half of what was planned for the year.

Why does it matter?

Even though both RBI and MoSPI back up these optimistic growth numbers, the tax shortfall puts real pressure on government spending—especially for things like infrastructure and rural jobs that many people rely on.
With US tariffs still high and banks wary after recent cash crunches, India faces some tough choices balancing growth with financial stability.
A new way of measuring GDP is expected soon, which could help clear up some of these challenges.