India’s economy grew by 7.8% in the quarter ending June, comfortably beating expectations and matching the previous quarter’s pace, according to data released Monday by the Ministry of Statistics and Program Implementation.
The reading came in well above the 7.1% growth forecast in a Reuters poll of economists, signaling resilience even amid global headwinds and geopolitical tensions.
The acceleration was led by strong performance in financial, real estate, information technology and professional services sectors. Manufacturing and services also improved sharply from the prior quarter, while agriculture and allied sectors reported tepid growth.
The latest data suggests the impact of the Iran war has not dented India’s growth as feared, according to Aastha Gudwani, India chief economist at Barclays, in comments to CNBC’s Inside India. Of the 20 high-frequency indicators Barclays tracks, only seven showed a slower average growth rate in the April-to-June quarter versus the January-to-March period, she noted. Consumer demand has remained “robust,” and manufacturing, services, automobile sales and loan growth are “holding up really well,” she added.
The upbeat GDP number comes just weeks after the Reserve Bank of India warned that growth is expected to slow over the current financial year. The central bank had estimated the economy would grow by 7.0% in the June quarter and by 6.7% for the fiscal year ending March 2027.
In its August policy review, the RBI said “the turbulent global economic environment” would likely weigh on domestic activity, with energy prices and supply chain pressures remaining “elevated and uncertain.” The central bank also flagged risks from El Niño conditions, which could lead to a deficient and uneven south-west monsoon, posing threats to the farm sector and rural demand.
Rising energy costs are already showing up in the inflation data. India’s consumer price inflation climbed for nine straight months to 4.45% in July. Even so, the RBI did not hike interest rates in its August meeting, diverging from some of its Asian peers who have tightened policy in response to global pressures.
Source: www.cnbc.com — https://www.cnbc.com/2026/08/31/india-economy-gdp-energy-el-nino.html
This article is for informational purposes only and does not constitute financial, investment, tax, or legal advice. Do your own research and consult a licensed professional before making financial decisions.
