India’s economy expanded by 7.8 per cent in the October to December quarter compared with the same period last year, following 8.4 per cent growth in the preceding quarter, the government data revealed on Friday alongside a revised set of national output figures. For the full fiscal year ending March, the National Statistics Office (NSO) projects the South Asian economy to have grown by 7.6 per cent, up from an earlier estimate of 7.4 per cent under the previous data series.
At this rate, India continues to be the world’s fastest-growing major economy. Notably, the Ministry of Statistics and Programme Implementation (MoSPI) has introduced a new series of annual and quarterly national accounts with 2022–23 as the base year, replacing the earlier 2011–12 base.
"The Q3FY27 GDP growth estimate at 7.8 per cent came a tad below our estimate of 8 per cent. The base revision and the new GDP series suggest that there is an upside bias to manufacturing growth vs the old series, but overall, there is not a significant diversion between the two. We continue to see FY27 growth at 7.1-7.2 per cent," said Garima Kapoor, Deputy Head of Research and Economist at Elara Capital.
The government, led by Prime Minister Narendra Modi, has overhauled economic statistics, including inflation and GDP data, by broadening data sources and updating the base year to 2022–23, among other revisions. These changes are intended to improve accuracy and address concerns about outdated methodologies.
"Given that the first quarter growth of the year has been revised down significantly, there will be some recalibration of growth for the fiscal year. The revised estimate for the FY is 7.6 per cent, so most likely, the fourth quarter will be around 7.5 per cent. What is heartening to know that the next year's growth is likely to be stronger, as per the CEA, and the growth is likely to range between 7.0% to 7.4%. This is a very robust growth to expect, backed by strategic budget reforms and the various trade agreements that we have been signing," said Rumki Majumdar, Economist, Deloitte India.
India’s nominal GDP for 2025/26, which does not account for inflation, is projected to grow by 8.6 per cent. In its budget presentation for FY 2026/27, the government had earlier forecast a nominal growth rate of 10 per cent under the old base year.
“As India moves towards deeper integration in the global value chains, base year updates at regular intervals, current after every five years, reflects government's commitment to data-driven policy intervention to shocks in the global economy. The revised GDP framework will enhance the credibility and analytical usefulness of India’s national accounts statistics,” said Ranjeet Mehta, Chief Executive Officer (CEO) and Secretary General (SG), PHD Chamber of Commerce and Industry (PHDCCI). |
