On January 28, 2026, four days before the 2026 Union budget, the All-India Congress Committee (AICC) released a report titled the ‘Real State of the Economy’. The report provided an important counterpoint to the government’s statistical projections on the economy, and laid out a template for the opposition’s interventions during the ongoing budget session. The AICC report echoes the Nav Sankalp economic policy outlined in the 2024 Lok Sabha election manifesto of the Indian National Congress. The Nav Sankalp policy called for an economic reset focussed on work, wealth, and welfare. It declared a strong opposition to crony capitalism, monopolies and oligopolies. The ‘Real State of the Economy’ report carries forward those ideas. The report is an important addition to the work being done by social movements, trade unions, and civil society, to re-create a critical public discourse on economic questions. Inequality and unemployment as lived experiences The pre-budget Economic Survey, published a couple of days after the release of the AICC report, claims that the Indian economy has been progressing at a rapid pace: India’s real GDP has been growing at 7.4% for Financial Year (FY) 2026; domestic demand – supported by capital formation – has continued to anchor growth; manufacturing activity has gained traction; services are driving expansion; trade, transport, financial and professional services are showing steady performance.Anticipating the government’s claims, the AICC report laid down an important marker on the question of data. It correctly identifies that ‘macroeconomic indicators and people’s lived realities do not align with these statistics.’ Indeed, inequality, unemployment, underemployment, precarity and economic insecurities are too visible all around to ignore. The government has consistently tried to project a feel-good state of affairs through selective projection of data, but the reality is quite grim. The AICC report reminds us of a recent evaluation of national account statistics by the International Monetary Fund (IMF) which raised concerns regarding the veracity of official data. Drawing upon alternative data sets, the report questions the government’s persistent claims on economic growth, claims which have subsequently been reiterated in the 2026 budget presented on February 1. The authors point out that whereas ideally growth propels investments, this has not been the case. Gross fixed capital formation has been hovering around the 30% of GDP mark. In four of the 10 months of 2025, net Foreign Direct Investment was negative. Net financial savings have improved only slightly after their historic fall in FY23. The average debt amount has increased 40% since March 2021, creating serious concerns regarding the economy falling into a debt trap. Government policies and their roles The report argues that the economic difficulties we face today are the result of policy choices. This observation is worrying, but also promising, since it implies that course correction is possible through a reconfiguration of policies. The authors have identified unequal tax burden, policy failures in creating stable jobs, divergence between corporate profits and job creation, and sector specific shortcomings, as the main reasons behind problems plaguing the domestic economy. The important observations in the report are summarised below. Corporations have received tax cuts while the common masses have been burdened with consumption taxes through higher excise on fuel, high GST rates, etc.Government employability schemes such as the Make in India, Smart Cities, PM Kaushal Vikas Yojana, and Employment Linked Incentive Schemes have fallen short of their targets. Manufacturing and services have stopped absorbing workers, pushing more people back into agriculture and self-employment while hiding large-scale disguised unemployment. Thousands of posts in public employment remain vacant.Even among salaried workers, job security is weak. Nearly 40% have no written contract, and more than half receive no paid leave or social security. Work is increasingly informal, insecure, and poorly paid. Young people and women are the worst affected by the poor quality of work. In FY24, profits grew by over 22%, while employment increased by only 1.5%. Growth has benefited companies, not workers. Promises of doubling farmer incomes, assured prices, and risk protection have not translated into structural improvements. Agriculture continues to employ nearly half of India’s workforce while contributing only 16% to GDP, locking millions into low productivity and underemployment. 52% of agricultural households are indebted, 24.6% rely on non-institutional credit, and Kisan Credit Card bad loans rose from Rs 68,547 crore in March 2021 to Rs 97,543 crore in December 2024. During the past year foreign investment have fallen, exports have slowed, India’s dependence on Chinese imports has grown. Tarriff bullying by the United States of America is severely impacting India’s exports. Retreat of welfare The report reiterates a core principle of our constitution: that it is the state’s duty to protect its citizens in times of economic difficulty. Over the years, a range of rights-based legislations had been put in place to strengthen the economic safety net, empower people and decentralise decision-making. Among these, the National Rural Employment Guarantee Act (NREGA) has now been repealed, the National Food Security Act (NFSA) has been increasingly suffocated by the lack of funds, while there has been a general decline in socio-economic support for the needy. The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) was designed to make the right to work a legal entitlement, guaranteeing 100 days of local wage employment to any individual demanding work. Its replacement, the Viksit Bharat Guarantee for Rozgar and Ajeevika Mission (VB-G RAM G), strips rural workers of an enforceable right and reduces livelihood security to a rationed, discretionary promise.Allocations under the National Food Security Act (NFSA), including ICDS, PM POSHAN, and maternity entitlements, have been reduced by nearly 50%, weakening India’s nutrition safety net. Hunger and malnutrition remain widespread. Social security for the elderly remains grossly inadequate. Nearly 78% of elderly Indians receive no pension support. Budgetary allocations for the National Social Assistance Programme (NSAP) declined from 0.6% of the Union Budget in 2014 to just 0.2% in 2025; the latest budget made a nominal increase. Pension amounts have stagnated despite rising living costs. Under NSAP, old-age pensions remain as low as Rs. 200 per month for beneficiaries aged 60-79 and Rs. 500 for those above 80, far below minimum subsistence requirements. In parallel, the minimum EPFO pension has been frozen at Rs. 1,000 since 2014, sharply eroding pensioners’ purchasing power. Pension schemes for informal workers and farmers have recorded extremely low enrolment and high drop-out rates, reflecting weak scheme design and poor implementation. Increasing digitisation has intensified exclusion rather than improving access. Development as a rights-based, holistic process The decade of United Progressive Alliance rule (2004-2014) had witnessed unprecedented collaboration between the government, social movements, trade unions and civil society. This led to the creation of policies and legislations that made citizen’s empowerment and decentralised decision-making integral parts of economic planning. Apart from NREGA and NFSA, there were the Right to Information Act (2005), Forest Rights Act (2006), Right to Education Act (2009). Labour policy was decided through regular meetings of the tripartite Indian Labour Conference (ILC).The AICC report laments that have been a clear political shift in the approach of the government from empowering citizens through law and institutions to managing them through compliance rules, scheme-based welfare, and executive discretion. This is most blatant in the way the new labour codes were passed without consulting the ILC, which has not been convened since 2015. The report recognises that the labour codes do not adequately ensure protections for the largest segments of the Indian workforce. The Social Security Code’s loose definition keeps gig workers outside ‘employee’ status and enforceable labour rights, preserving platforms’ exploitative, cheap, on-demand model. The authors have reiterated the view of all major trade unions that the codes fail to guarantee minimum wages, written contracts, safety, or social security as enforceable rights for the informal workforce. Instead, the codes push workers into databases and scheme-based welfare. These changes are likely to weaken workers’ bargaining power, weaken law enforcement, and pave the way for greater insecurity for workers, especially in the informal economy, where close to 90% of Indians work.The Indian constitution strongly emphasises that economic development is best achieved through the full development of human capability. This is not possible without social development. Ensuring quality and affordable education and healthcare for all is thus a necessary component of economic development. The report criticises what it terms as ‘systematic neglect’ of healthcare and education during the past decade of Bharatiya Janata Party’s (BJP) rule. The authors emphasise that the government’s expenditure on health and education remains ‘abysmally low’ at 0.29% and 0.4% of the GDP, respectively. Both sectors have been opened up for large-scale privatisation, pushing expenses up and negatively affecting inclusion and access. The report draws much needed attention to the public health emergency created by air and water pollution. The government’s response to this emergency has been rather weak and disappointing. On the whole, the report is much more than a critical review of existing government policies. It strongly suggests an alternative policy regime based on long-standing ideological pillars of India’s constitutional democracy: equality, justice, freedom and dignity of the individual, sovereignty of the nation. The report carries echoes of ongoing movements on the ground, not least of the general strike on 12 February against the labour codes. Though rendered invisible by the mainstream media, protests against unemployment, underemployment, and burgeoning inequality have grown. Air pollution and environmental hazards, denial of basic necessities like dignified housing and potable water, and lack of access to affordable education and healthcare, have been the subjects of growing discontent. The BJP is known for propagating a Hindu majoritarian and socially conservative ideology. A clear economic outlook appears to be missing in its political-ideological framework. However, upon a closer look it becomes clear that the economy is actually a major component of its worldview. Leaders like Dattopant Thengadi – who founded important organisations like the Bharatiya Kisan Sangh, Bharatiya Mazdoor Sangh and the Akhil Bharatiya Adhivakta Parishad – spent a lifetime creating an economic doctrine aligned with Hindu majoritarian and socially conservative views. In his book RSS: Aala Mattu Agala, iconic Kannadiga author and intellectual Devanur Mahadeva identified the present moment in Indian history as a battle between the Indian constitution and caste-based inequality and oppression which the constitution sought to undo. A deeply unequal socio-economic structure created and sustained through cronyism dovetail with conservative caste-based worldviews. Swadeshi, self-reliance and emphasis on duties can have varying meanings but these have been craftily mobilised by the BJP to legitimise the economic policies criticised in the AICC report. For example, the Shram Shakti Neeti portrays work as ‘national duty’ rather a value generating activity which gives rise to certain rights. This legitimises the curtailment of workers’ rights through the labor codes. Such narratives draw upon decades of ideological work by Thengadi, Deendayal Upadhyay and other Sangh Parivar stalwarts. The report creates a template for building a counter-narrative based on constitutional values. Dr. Akash Bhattacharya is a historian and trade-unionist based in Delhi. He is affiliated to the All-India Central Council of Trade Unions (AICCTU) which is part of the Joint Platform of Central Trade Unions.