India’s economy is expected to maintain strong momentum in the current financial year, with real GDP projected to grow at 7.6 per cent in 2025–26, according to fresh estimates released by the Ministry of Statistics and Programme Implementation, India (MoSPI) on Friday.

Nominal GDP, which factors in inflation, is estimated to expand by 8.6 per cent during the same period.

Strong Quarterly Performance Supports Growth

The projected annual growth is backed by robust quarterly performance. Real GDP growth stood at 8.4 per cent in the second quarter and 7.8 per cent in the third quarter of 2025–26. Specifically, during the October–December quarter, the economy recorded 7.8 per cent real growth, reflecting sustained economic activity across sectors.

India has demonstrated steady resilience over recent years, recording real GDP growth of 7.2 per cent in 2023–24 and 7.1 per cent in 2024–25. Nominal GDP growth during these years was 11.0 per cent and 9.7 per cent, respectively.

Manufacturing and Services Drive Expansion

The manufacturing sector has emerged as a major growth engine following the recent rebasing exercise. It recorded double-digit growth in both 2023–24 and 2025–26. Meanwhile, the secondary and tertiary sectors also supported expansion, each registering growth above 9 per cent in 2025–26.

According to official data, the economy had earlier grown 8.7 per cent in 2021–22 and 7.2 per cent in 2022–23, reflecting a steady post-pandemic recovery trajectory.

New Base Year for National Accounts

MoSPI has introduced a new series of Annual and Quarterly National Accounts Estimates with 2022–23 as the base year, replacing the earlier 2011–12 base.

Base year revisions are periodically undertaken to reflect structural changes in the economy and improve accuracy. Unlike routine annual revisions, which only update data, a base year revision may introduce new data sources, improved methodologies, and wider coverage to better capture evolving economic activity.

The year 2022–23 was chosen as it represents a relatively normal post-pandemic period with comprehensive data availability across sectors.

MoSPI is also revising the base year for other key macroeconomic indicators such as the Consumer Price Index (CPI) and the Index of Industrial Production (IIP). In late 2025, the International Monetary Fund (IMF) assigned India a ‘C’ rating on national accounts methodology, highlighting the need for updated base-year data.

Rising Global Economic Standing

Over the past decade, India has climbed significantly in global economic rankings. From being ranked 11th in 2013–14, the country is now the fourth-largest economy in the world in terms of overall size.

In 2013, India was part of the so-called “Fragile Five” — a term coined by a Morgan Stanley analyst to describe emerging economies facing macroeconomic vulnerabilities, alongside Brazil, Indonesia, South Africa, and Turkey.

Today, India stands among the fastest-growing major economies globally. However, policymakers acknowledge that improving per capita income and ensuring inclusive growth remain key priorities in the years ahead.

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