India’s real GDP growth rate is expected to reach 7.4% in the fiscal year 2025-26, up from 6.5% in the previous fiscal year, as per advanced estimates released by the Ministry of Statistics. The services sector, including financial services, real estate, professional services, and public administration, is a key driver with a robust growth of 9.9% in FY 2025-26.
The trade, hotels, transport, and communication sectors are estimated to grow by 7.5%, while manufacturing and construction are projected to achieve a growth rate of 7% in the secondary sector. The agriculture sector’s growth rate is estimated at 3.1%.
Real Private Final Consumption Expenditure (PFCE) is expected to grow by 7% in FY 2025-26, supported by income tax exemptions and GST rate cuts. Gross Fixed Capital Formation (GFCF) is estimated to grow by 7.8% at Constant Prices during the same period.
In the second quarter of the current financial year, India’s GDP growth accelerated to 8.2%, driven by the secondary and tertiary sectors with growth rates of 8.1% and 9.2% respectively. The manufacturing sector saw a growth rate of 9.1%, while the construction segment grew at 7.2%.
The growth rate of financial, real estate, and professional services in the tertiary sector surged by 10.2% in the second quarter. The agriculture sector posted a 3.5% growth, and the electricity, gas, water supply, and other utility services sector grew by 4.4%.
Real PFCE increased by 7.9% in the second quarter compared to the previous year, reflecting higher incomes and employment. The first half of the fiscal year 2025-26 recorded an impressive 8% growth rate, making India the world’s fastest-growing major economy.
