India’s economy grew at a strong pace of 7.8 per cent in the April-June quarter of the current financial year, according to official data released by the Ministry of Statistics on Friday. This marks an acceleration from the 6.5 per cent growth recorded in the same quarter of 2024-25.
The rebound in agriculture was a major driver of growth, with the sector expanding by 3.7 per cent compared to 1.5 per cent in the corresponding period last year when output was impacted by erratic monsoon patterns.
Manufacturing activity rose by 7.7 per cent, while the construction sector grew by 7.6 per cent. Services, which form a large part of the economy, posted a sharp rise of 9.3 per cent, up from 6.8 per cent in the first quarter of the previous financial year.
Investment levels in the economy also strengthened. Gross Fixed Capital Formation increased by 7.8 per cent during the quarter, compared to 6.7 per cent a year earlier. Government final consumption expenditure recorded a growth of 9.7 per cent in nominal terms, more than double the 4 per cent growth in the same period last year.
The data showed that rural demand and public investment remained strong, supported by infrastructure spending in highways, railways, ports and airports. Private final consumption, however, grew at a slower pace compared to the previous year.
The growth rate surpassed the Reserve Bank of India’s earlier projection of 6.5 per cent for the first quarter. Despite global uncertainties, the central bank has maintained its GDP growth forecast for 2025-26 at 6.5 per cent, citing supportive domestic factors.
RBI Governor Sanjay Malhotra said that the above-normal southwest monsoon, lower inflation, rising capacity utilisation and favourable financial conditions are expected to sustain economic momentum. “Supportive monetary, regulatory and fiscal policies, including robust government capital expenditure, should also boost demand. The services sector is likely to remain buoyant with continued growth in construction and trade,” he noted.
International agencies have also reaffirmed India’s strong outlook. The International Monetary Fund has projected India to remain the only major economy expected to grow above 6 per cent in 2025-26, even as global growth faces headwinds due to trade disruptions and tariff tensions.
-IANS