As 2025 draws to a close, many will ring in the New Year at grand parties, while battling coughs from toxic air—a fitting metaphor for the year itself. This is the story of 2025: transformative developments shadowed by turbulent regression. An economy posting respectable growth, but the poor and vulnerable continue to get a bad deal. The same pattern mars infrastructure, justice delivery, environmental policy and reform implementation. The duality is particularly galling across several critical sectors.
Infrastructure: Grand Plans, Deadly Failures
India's infrastructure development swung between ambition and fragility. On paper, the achievements are formidable: 10,000km-12,000km (kilometres) of national highways added; expanded expressway networks, tunnels, flyovers; and built a showpiece coastal road on reclaimed land.
Yet, NH66, which connects Mumbai and Goa, remains nightmarish for over a decade, causing deaths and killing tourism. When court orders failed, young engineer Chaitanya Patil embarked on a ‘Road Satyagraha’ to document the terrible road conditions and prepare a report.
More worrying are repeated structural failures. Across states, bridges and flyovers collapsed or developed serious cracks within months of inauguration, resulting in deaths and disruption. A defining feature was the complete lack of accountability, with only cosmetic action like temporary suspensions, promised audits and pretended inquiries with little evidence of criminal liability or blacklisting the contractors.
Indeed, investigative reports reveal that contractors implicated in failed projects continue to win new projects due to political proximity or generous donations to ruling parties. Political parties remain sanguine that public outrage over deaths is temporary and fizzles out.
Aviation: The IndiGo Meltdown
The biggest blow to the Viksit Bharat narrative was the IndiGo meltdown in early-December. Tens of thousands of helpless flyers were stranded as India's largest airline, with a 60% market share, cancelled thousands of flights after a self-made disaster, fuelled by arrogance and misplaced confidence about regulatory capture. (Read: Too Big To Ground: How IndiGo Forced a Safety Compromise )
Coming after the catastrophic crash of Air India's Ahmedabad-London flight in June which killed 241 people, it highlighted long-standing weaknesses in Indian aviation policy. Excessive concentration of business leads to systemic risk; a lesson that policy-makers failed to learn after the collapse of Jet Airways and Kingfisher Airlines. Even today, the aviation ministry and its regulator, director general of civil aviation (DGCA), remain largely reactive.
There is no attempt to fix underlying issues such as high airport charges, steep taxes on aviation fuel and the impact of a depreciating rupee on airline viability. Without addressing these, repeated failures and flight cancellations may remain regular features, especially to non-metro destinations.
The UDAN scheme, to connect smaller towns and remote areas to bigger cities, by making air travel affordable and accessible for common people, captures the broader contradiction. Instead of focusing on airline viability, India went on a politically-dictated airport building spree; most of them remain idle or under-served because unreasonable fare caps and policy rigidity deter airlines.
India's aviation crisis is really about bad policy, regulatory capture and failure to understand viability concerns necessary to make the system work. That is why no other airline has been able to capitalise on the multiple issues faced by IndiGo as well as Air India.
Aravalli and Environment: Public Pressure Works
Large-scale public protests over destruction of the Aravalli hills exposed weaknesses in India's environmental jurisprudence and our inability to balance development with protecting the environment. Since the mid-1980s, the apex court had repeatedly intervened to restrict mining and construction in the Aravalli range, recognised as a groundwater recharge zone and critical ecological barrier protecting the national capital region (NCR) from unprecedented air pollution.
In November 2025, the mining lobby scored when the Supreme Court (SC) accepted a technical definition based on height and contiguity criteria recommended by the environment ministry. The ruling effectively stripped protection from vast ecologically contiguous areas earlier considered part of the Aravalli system, legitimising mining and real estate projects in fragile zones under the guise of definitional clarity.
The backlash was unprecedented. Protests across Rajasthan and Haryana were so huge that they forced government as well as courts to roll back. On 29th December, SC stayed its own order and initiated a fresh review, effectively acknowledging that the legal and scientific basis of its decision required reconsideration.
This exposes a deep duality. While people look to the judiciary as defender of environmental protection, courts increasingly rely on technical inputs bearing the mark of corporate lobbies to dismiss environmental opposition as anti-development, until public protests force a rethink.
Labour Reforms: Will Ambition Meet Execution?
On 21st November, the government finally notified four consolidated labour codes replacing 29 Central laws. They simplify compliance, introduce uniform wage definitions and mandatory social security for gig workers, while giving employers flexibility to hire and fire. The move triggered massive backlash; a joint forum of trade unions and farmer groups held a massive bandh and threatened strikes.
As Debashis Basu wrote in these columns, India's regulatory ambition usually outruns practical capabilities (Read: India’s New Labour Codes: Policy Vs Execution). Reform needed to spur economic growth is marked by India's chronic execution failures caused by bureaucratic inefficiency, corruption and absence of proper digital infrastructure on which the labour codes also rely.
Electricity Amendment Bill: Reform Meets Reality
The Electricity Amendment Bill offered another illustration of the limits of market-led in essential services. It sought to de-licence power distribution, allowing multiple distributors in the same area. This was a long-pending reform for improving efficiency and breaking the grip of State-owned discoms. Instead, it triggered intense political resistance as farmer groups, state governments and trade unions warned that de-licencing would enable private monopolies to ‘cherry-pick’ profitable urban consumers leading to sharp tariff hikes for rural and agricultural users.
The flashpoint was routing subsidies through direct benefit transfers (DBT). These have lost credibility over time, leading to concerns that vulnerable consumers would face billing shocks, payment delays, arbitrary disconnections and poor redress, especially in states with patchy administrative capability. Protests led to a partial rollback, underlining a recurring pattern: ambitious structural reform announced at the Centre that is diluted when it collides with ground realities and electoral risk.
The bigger issue was that de-licencing was presented as a cure without first fixing regulatory capacity, tariff rationalisation, or the financial rot in State discoms. Without credible regulators, enforceable service obligations and clear safeguards against concentration, competition risks becoming cosmetic. Once again, ambitious reform was borrowed from developed markets without accounting for corruption, institutional weakness and poor administration.
Bankruptcy Reform: A Faltering Promise?
The Insolvency and Bankruptcy Code, overhauled in its 10th year, is another study in contrasts. Hailed as landmark reform that reshaped corporate insolvency and resolved 30,000 cases worth ₹3.5 lakh crore, it was hamstrung by structural flaws and implementation bottlenecks. Initially successful, it was soon marred by poor recovery outcomes, especially for politically powerful defaulters. Time-bound resolution has been frustrated and it seemed to discriminate against stakeholders like bona-fide home-buyers. High-profile reversals, like in Bhushan Power, have rattled investor confidence.
Amendments have codified the ‘Clean Slate’ doctrine to guarantee finality and resolution of all claims. Yet, experts argue that unless ambiguous definitions and implementation challenges are resolved and independence of Insolvency Professionals restored, the law may drift from its original promise. Rulings like the SC’s order in Sterling Biotech involving the fugitive Sandesara family, especially when contrasted with the Vijay Mallya case, continue undermining confidence in enforcement. (Two Indias Insolvency: Small Borrowers Lose Their Lives, Big Defaulters Get ‘One-time’ Pardons)
AI and Digital Fraud: Progress and Peril
Artificial intelligence (AI) stopped being a buzzword in 2025, reshaping searches to homework, analytics to customer support. Simultaneously, it exacerbated AI-enabled cyber threats and weaponised digital fraud. The year recorded a scary AI-driven corporate heist where a multinational's Indian subsidiary transferred ₹200 crore following a ‘deepfake’ video call from their global chief financial officer (CFO), leading to new mandatory verification protocols and increased cybersecurity costs.
For ordinary people, 'digital arrest' has been the most lethal scam with fraudsters impersonating law enforcement and even judges to coerce hefty payments from scared, hapless people. The fraud's effectiveness is itself a telling reflection on distrust of government agencies and fairness of processes or hope of timely legal redress.
Courts: The Finality Problem
This brings us to the underlying theme of 2025: failure of effective, timely legal redress and finality of judgements. We saw repeated cases of the Supreme Court revisiting and overturning its own judgements within weeks and months. Long before r it stayed the Aravalli hills judgement, SC had back-pedalled on stray dogs, recalled its order liquidating Bhushan Steel after resolution (Read: Supreme Court Upholds JSW Resolution Plan for Bhushan Power and Steel) and walked back its May 2025 Vanashakti decision (Supreme Court's U-turn in Review Raises Fundamental Questions about Development and Environmental Governance), effectively paving the way for retrospective environmental clearances. This growing trend has generated concern about legal certainty and public confidence.
While the Court itself has expressed concern over reopening cases undermining its authority, the trend continued into the last week when it stayed the Aravalli judgement. While judicial review and correction are legitimate parts of a dynamic legal system, the frequency and speed of these reversals in 2025 are unusual, raising fears that the last hope of finality after long and expensive litigation will remain permanently open.
As 2026 begins, India stands at a critical juncture. The aspiration is clear—infrastructure expansion, aviation growth, environmental protection, labour reform, power sector modernisation, bankruptcy resolution and digital transformation. The execution, however, remains consistently troubled. Can India build the institutional capacity and have the political will to implement reforms without dilution? Or will we see more of the same in 2026?
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