India’s Economy Beats Expectations, GDP Grows 7.8% in Q4 and 7.7% in FY26

India’s economy exceeded market expectations in the fourth quarter of FY 2025-26, recording a real GDP growth of 7.8 per cent year-on-year, according to official data released on Friday. For the full financial year, the economy is estimated to have expanded by 7.7 per cent.

At constant prices, India’s real GDP stood at Rs 87.77 lakh crore in the January-March quarter, compared to Rs 81.40 lakh crore during the same period in the previous fiscal year. Meanwhile, nominal GDP for Q4 FY26 is estimated at Rs 94.65 lakh crore, reflecting a 9.1 per cent annual growth rate.

Strong GDP and GVA Growth

For the full financial year 2025-26, real GDP is estimated to attain Rs 323.12 lakh crore, compared with the First Revised Estimate of Rs 299.89 lakh crore in FY25, reflecting a growth rate of 7.7 per cent. Nominal GDP is estimated at Rs 346.36 lakh crore, growing 8.9 per cent over the previous year.

Gross Value Added (GVA), a key measure of economic activity, is estimated to grow 7.9 per cent in FY26, while nominal GVA is projected to rise 9.1 per cent. In the fourth quarter, real GVA growth stood at 7.9 per cent, while nominal GVA expanded 9.9 per cent.

Secondary and Tertiary Sectors Drive Expansion

The data showed that the secondary and tertiary sectors remained the key drivers of growth. For FY26, the secondary sector is estimated to grow 8.8 per cent and the tertiary sector 9.3 per cent at constant prices. The primary sector registered growth of 3.2 per cent, supported mainly by agriculture and fisheries.

Manufacturing, trade, repair, hotels, transport, communication and services related to broadcasting, storage, as well as financial, real estate and professional services recorded double-digit growth during FY26 at both constant and current prices.

Consumption and Investment Remain Strong

On the expenditure side, Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) expanded by more than 7.5 per cent during the fiscal year. In the fourth quarter, GFCF grew 10.8 per cent while PFCE rose 7.1 per cent, indicating continued strength in investment and consumption demand.

Sectoral data for Q4 FY26 showed strong growth in trade, hotels, transport, communication and services related to broadcasting and storage at 12.5 per cent, followed by financial, real estate and professional services at 10.4 per cent. Manufacturing grew 7.3 per cent, while construction expanded 8.4 per cent during the quarter.

(With Inputs from ANI)

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Disclaimer: This article is based on official GDP estimates and economic data released by the Government of India. Economic figures, growth rates, and sectoral performance data are subject to revisions in future releases. The information is intended for informational purposes only and should not be considered financial, investment, or economic advice. Readers are advised to refer to official government publications and statistical releases for the most up-to-date information.