India’s economy is estimated to have expanded at 7.4% in real terms in the financial year 2025-26, the highest level in two years, according to the First Advance Estimates released by the Ministry of Statistics on Wednesday. The growth rate was 6.5% during FY25 and 9.2% in FY24.
The nominal GDP, which accounts for inflation, is estimated to grow at 8% in the current fiscal.
The government said buoyant growth in services sector has been found to be a major driver in India’s resilient economic expansion in the face of external pressures like the US tariffs and geopolitical uncertainty. Tertiary activities is projected to grow 7.3%.
Manufacturing and construction in the secondary sector has been estimated to achieve a growth rate of 7% despite trade pressures.
Agriculture and allied sector growth is expected to have slowed to 3.1% from 4.6% last year.
Private consumption, which fuels over half of the Indian economy, has been estimated to attain a growth rate of 7%, compared to 7.2% in the previous fiscal.
Gross Fixed Capital Formation, which measures the level of new investments, is projected at 7.8% growth rate, higher than 7.1% last year.
Export growth was marginally higher at 6.4% (from 6.3%), while imports rose 14.4% compared to a 3.7% decline in the previous year.
Real Gross Value Added (GVA), which measures the supply-side contribution in the economy, is projected to grow at 7.3%. Nominal GVA may grow at 7.7%.
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