What are the latest updates on India's GDP growth and economic forecasts?

Q1 FY 2026–27 GDP Performance

India’s economy began FY 2026–27 on a strong note, recording a real GDP growth rate of 7.8% in the first quarter (Q1: April–June 2026) to reach ₹81.36 lakh crore. This outcome surpassed the Reserve Bank of India’s (RBI) quarterly projection of 7.0% and accelerated from the 6.9% growth recorded in Q1 FY 2025–26.

Nominal GDP: Reached ₹88.27 lakh crore, marking a 10.3% year-on-year increase.

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Gross Value Added (GVA): Real GVA expanded by 8.2% (₹73.82 lakh crore), while nominal GVA grew by 11.5% (₹80.53 lakh crore).

Demand Components: Expansion was supported by an 11.9% surge in Gross Fixed Capital Formation (GFCF/investments), a 12.0% growth in exports, and a 7.1% rise in Private Final Consumption Expenditure (PFCE).

Sector-Wise Breakdown

Services (Tertiary Sector): Leading overall economic activity, real GVA in services grew by 10.0%, propelled by financial, real estate, IT, and professional services, which expanded by 12.1%.

Secondary Sector: Grew by 8.6%, supported by robust manufacturing output which rose by 9.2%.

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Primary Sector: Recorded a 2.9% expansion, with agriculture and allied activities growing by 3.6%. Mining and quarrying contracted by 2.4% in real GVA terms, despite registering a high nominal GVA growth of 22.3% owing to significant price rises in crude oil and metal ores.

Updated Base Year & Revised Estimates

The Ministry of Statistics and Programme Implementation (MoSPI) rolled out a updated measurement framework with 2022–23 as the new base year (replacing the earlier 2011–12 series). This framework incorporates the Producer Price Index (PPI), Banking Services Price Index (BkSPI), an updated IIP index, and the Double Deflation method for manufacturing GVA estimation.

Under this new base year, MoSPI updated annual real GDP growth estimates for previous financial years:

FY 2023–24: Revised upward to 7.3% (from 7.2%).

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FY 2024–25: Revised upward to 7.2% (from 7.1%).

FY 2025–26: Revised upward to 7.8% (from 7.7%).

Economic Forecasts & Institutional Outlook

Reserve Bank of India (RBI): Projects real GDP growth to moderate to around 6.9% in FY 2026–27 as cyclical tailwinds fade amid global uncertainties.

ICRA Ratings: Adjusted its FY 2026–27 GDP growth forecast down to 6.2% (from 6.5% earlier), citing sticky crude oil prices (~$95/bbl) and geopolitical risks stemming from the West Asia conflict.

Multilateral Institutions: The IMF revised its FY 2025–26 forecast up to 7.3%, identifying India as a key engine of global growth. The World Bank projects 6.5% growth for 2026, while the OECD forecasts 6.7% for 2025.

Sovereign Rating: S&P Global Ratings affirmed India's 'BBB/A-2' sovereign credit rating with a Stable Outlook in August 2026.