India's Economy Accelerates With 8.2% GDP Growth In September Quarter Of FY 2025-26

India's GDP grew by 8.2% in the September quarter of FY 2025-26, supported by strong performances in manufacturing and services. However, agriculture and utilities faced challenges. This growth reinforces India's position as the fastest-expanding major economy globally.

India's economy accelerated in the September quarter, with GDP growing by 8.2% in Q2 of FY 2025-26. This figure surpassed the previous year's 5.6% and exceeded the 7.8% from the first quarter. The National Statistics Office (NSO) highlighted a robust performance from manufacturing, construction, and services, despite challenges from US tariffs. This growth underscores India's status as the fastest-expanding major economy as FY26 progresses.

GDP at constant prices reached Rs 48.63 lakh crore for the July-September period, rising from Rs 44.94 lakh crore a year earlier. The nominal GDP saw an 8.7% increase, totalling Rs 85.25 lakh crore. Manufacturing led the surge with a 9.1% increase, while construction rose 7.2%, contributing significantly to the secondary sector's 8.1% growth.

Robust Services Sector Drives Growth

The services sector continued to be a key driver, with the tertiary sector experiencing a 9.2% growth. This expansion was bolstered by a 10.2% increase in financial, real estate, and professional services. This segment of the economy outperformed others, reinforcing its pivotal role in the country's growth story.

Private consumption remained strong, as evidenced by real private final consumption expenditure (PFCE) growing by 7.9% in Q2. This marked an improvement from 6.4% in the same quarter last year, indicating sustained demand despite challenging monsoon conditions.

Challenges in Agriculture and Utilities

In contrast, the agricultural sector experienced sluggish growth, expanding just 3.5%. Similarly, utilities, including electricity, gas, and water supply, grew by only 4.4%. These sectors face a challenging phase compared to the rapid strides made by manufacturing and services.

Overall, the first half of FY26 witnessed an 8% GDP growth, up from 6.1% in the previous year's first half. Real GVA growth for Q2 was 8.1%, supported by broad-based expansion across various key industries. These numbers are pivotal as policymakers monitor inflation, consumption, and global demand trends.

The stronger-than-expected figures bolster India's position as the fastest-growing major economy globally.