India's GDP Grows 7.7% in 2025-26, Q4 Shows 7.8% Increase

The Indian economy has witnessed significant growth, with the gross domestic product (GDP) expected to expand by 7.7% in the financial year 2025-26. According to recent data released by the Ministry of Statistics and Programme Implementation, growth for the fourth quarter of the same year is estimated at 7.8%. This marks an increase from a growth rate of 7.1% recorded in the previous financial year, 2024-25.

These figures indicate that the growth trajectory is slightly above the 7.6% estimate announced previously in February 2026. The data comes at a crucial time as the Reserve Bank of India Governor Sanjay Malhotra recently projected that GDP growth for the ongoing financial year 2026-27 may decelerate to 6.6%.

Chief Economic Advisor V. Anantha Nageswaran noted in a press conference that he finds the Reserve Bank of India's projections on GDP and inflation to be reasonable and believes there is no need for further speculation.

In response to the favourable data, Indian Prime Minister Narendra Modi lauded the growth figures on social media, crediting the inherent strengths of the nation’s economy, along with the success of reforms and the efforts of the Indian populace. He stated, "We shall leave no stone unturned to further 'Ease of Living,' 'Ease of Doing Business,' and increase opportunities for our youth."

Finance Minister Nirmala Sitharaman highlighted that several sectors, including manufacturing, trade, and services, have shown double-digit growth rates at both constant and current prices during 2025-26. Specifically, the manufacturing sector experienced a growth of 10.7%, compared to 9.3% in the first revised estimates for 2024-25. In the fourth quarter, the manufacturing sector grew at 7.3%, down from 11.8% during the same period in the previous year.

The sector covering trade, repair, hotels, transport, communication, and related broadcasting services reported a significant growth rate of 11% in 2025-26, a rise from 6.6% in the previous year. In the fourth quarter, this sector accelerated to 12.4%, improving from 6.3% in Q4 of 2024-25.

However, the agriculture sector is projected to experience slower growth, expected to reach 3% in 2025-26 down from 4.2% in the previous year. The growth in Q4 is also expected to decelerate to 3.6% compared to 3.8% in the same quarter of 2024-25.

Private final consumption expenditure (PFCE) has also seen an increase, estimated to grow by 7.7% in 2025-26, compared to 5.8% in the prior year. The gross fixed capital formation, a measure of asset creation and investment, is projected to rise by 8.2%, up from 6.4% in 2024-25.

Looking forward, economists have cautioned that the growth rate in 2026-27 is likely to decline due to demand pressures and inflationary impacts arising from the ongoing crisis in West Asia, as well as expectations of below-normal monsoon rains.