India’s economic activity demonstrated resilience in April, with both the industrial and services sectors maintaining strength in various segments despite global uncertainties, as per the RBI’s monthly bulletin. The bulletin noted that listed private non-financial companies in Q4:2025-26 showed improved business performance, with double-digit growth in aggregate sales and operating profit.
In the agriculture sector, rapid progress in summer sowing was aided by above-normal pre-monsoon rainfall and sufficient reservoir storage levels. However, risks to harvesting rabi crops exist due to the probability of above-normal minimum temperatures and unseasonal rains in some regions. Public foodgrain stocks are above buffer norms, ensuring domestic food security.
Net foreign direct investment remained positive for the second consecutive month in March. Despite foreign portfolio investors being net sellers in April and May, the pace of outflows slowed down, according to the bulletin.
CPI inflation increased to 3.5% in April, primarily due to food inflation, while core inflation remained stable, indicating limited pass-through of higher input costs. The bulletin emphasized the need to monitor the pass-through to domestic prices, although headline inflation remains within the tolerance band.
The RBI bulletin highlighted that the conflict in West Asia continues to impact commodity markets, global trade flows, and supply chains, leading to financial market volatility. India, with its macroeconomic strength, faces challenges from financial conditions, crude oil prices, and capital flows. However, robust services exports, positive net FDI flows, foreign exchange reserves, and proactive policy measures by the Government and the Reserve Bank are expected to safeguard the Indian economy against external pressures.
