India’s GDP Grows 7.8% In Q1 FY26, Beats Market Expectations

New Delhi: India's economy grew by 7.8 percent in the first quarter of FY 2025-26, surpassing analysts' expectations. Strong performance in services and manufacturing sectors helped boost growth, signaling continued momentum despite global uncertainties and inflationary pressures.

India's Economic Growth Beats Expectations in April–June Quarter

India’s economy grew by 7.8 percent in the first quarter (April–June) of the financial year 2025-26, as per data from the National Statistics Office (NSO) released on Friday. This is a strong improvement compared to the 6.5 percent growth seen during the same time last year.

In terms of actual numbers, real GDP (which accounts for inflation) rose to Rs 47.89 lakh crore, up from Rs 44.42 lakh crore in the April–June quarter of 2024.

Meanwhile, nominal GDP (which includes the impact of inflation) stood at Rs 86.05 lakh crore, an 8.8 percent increase from Rs 79.08 lakh crore in the same quarter last year.

This positive data shows that India’s economy is moving strongly despite global challenges.

Agriculture sector grew by 3.7 percent

One of the biggest reasons for this higher growth was the strong performance of the agriculture sector, which grew by 3.7 percent. This is a sharp improvement from the 1.5 percent growth seen in the farming sector during the April-June quarter of the previous year. Good output from farming and related activities helped boost rural income and support the broader economy.

Fastest-growing major economy in the world

India has also kept its spot as the fastest-growing major economy in the world. For instance, China’s economy grew by only 5.2 percent during the same time, which is much slower than India’s 7.8 percent. This highlights India’s strong economic momentum even amid global uncertainties.

Manufacturing sector performed steadily

The manufacturing sector, another key part of the economy, also performed steadily. It grew by 7.7 percent, slightly better than the 7.6 percent growth recorded in the April-June period of the previous year. Although the improvement is small, it signals that production activity is holding up well.

Growth figure is better than earlier prediction

Growth figure is much better than what was earlier predicted. The Reserve Bank of India (RBI) had forecasted a 6.5 percent GDP growth for Q1 of FY 2025–26. It had also predicted 6.7 percent for Q2, 6.6 percent for Q3, and 6.3 percent for Q4. But the actual performance in Q1 has already beaten expectations, offering a strong start to the fiscal year.

Despite upcoming challenges like global trade tensions and US tariffs, this data shows that India’s economy remains resilient, driven by agriculture and steady manufacturing, and continues to outperform its global peers.