New Delhi, September 1, 2026: India’s economy expanded by a stronger-than-expected 7.8% during the April–June quarter of financial year 2026–27, supported by robust investment, services, manufacturing and domestic consumption.
The latest growth rate was higher than the 6.9% recorded in the corresponding quarter of FY 2025–26 and exceeded the Reserve Bank of India’s 7% projection. However, growth moderated from 8.6% in the previous January–March quarter.
According to the Ministry of Statistics and Programme Implementation, India’s real GDP at constant prices reached ₹81.36 lakh crore, compared with ₹75.46 lakh crore a year earlier.
Nominal GDP, which includes the effect of price changes, grew by 10.3% to ₹88.27 lakh crore from ₹80 lakh crore in the same period last year.
PM Modi Hails ‘Herculean Feat’
Prime Minister Narendra Modi described the 7.8% growth as a “herculean feat”, saying it demonstrated the collective strength and resilience of India’s people amid global uncertainties, oil-price shocks and supply-chain disruptions.
“7.8% growth. Strong numbers. Even stronger confidence,” Modi said while congratulating the country.
The prime minister added that pessimistic predictions about the Indian economy had been proved wrong, declaring that India had “bloomed” once again despite challenging global conditions.
Services and Investment Drive Growth
The services sector emerged as a major growth engine, expanding by 10% during the quarter. Financial, real-estate, information technology and professional services recorded particularly strong growth of 12.1%.
The secondary sector—which includes manufacturing, construction and utilities—grew by 8.6%. Agriculture and allied activities expanded by 3.6%, helping the broader primary sector register growth of 2.9%.
Real Gross Value Added, a measure of economic activity across major sectors, increased by 8.2%, while nominal GVA rose by 11.5%.
Investment Jumps 11.9%
Gross fixed capital formation, an indicator of investment in infrastructure, machinery and other productive assets, surged by 11.9%, more than double the 5.8% growth recorded a year earlier.
Investment’s share of the economy climbed to 34.3% from 31.4%, indicating that public infrastructure spending may be encouraging greater private-sector investment.
Private consumption, which accounts for a significant portion of India’s economy, increased by 7.1%. Exports grew by 12%, while imports declined by 1.1% at constant prices.
Outlook Remains Positive but Risks Persist
India continues to rank among the world’s fastest-growing major economies. Rising investment, resilient consumer demand and expansion in technology, manufacturing, railways, renewable energy and semiconductors could support growth in the coming quarters.
However, elevated crude-oil prices, geopolitical tensions, currency weakness, inflation and slower employment generation remain important risks. Economists have also cautioned that difficult year-on-year comparisons and a possible moderation in public spending could slow growth later in the financial year.
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