India’s Q2 GDP surges 8.2%; full year growth to stay above 7%, says CEA
India’s economy grew 8.2% in the July–September quarter (Q2) of FY 2025-26, sharply higher than the 5.6% expansion recorded a year earlier, according to data released by the National Statistics Office (NSO) on Friday. The strong performance, powered by manufacturing, construction and services, prompted Chief Economic Adviser (CEA) Dr. V. Anantha Nageswaran to project that full-year growth will “comfortably” be 7% or higher.
Calling the latest print “outside even the most optimistic estimates,” the CEA said the Q2 outcome reflects “the cumulative efforts of policies put in place since the government returned in June 2024.” Real GDP for the quarter stood at Rs 48.63 lakh crore, while nominal GDP rose 8.7% to Rs 85.25 lakh crore.
Growth was supported by a broad-based improvement in key sectors. The secondary sector expanded 8.1%, driven by 9.1% growth in manufacturing and 7.2% in construction. The tertiary sector grew an even stronger 9.2%, with financial, real estate and professional services rising 10.2%. Private consumption also held firm, with Real Private Final Consumption Expenditure rising 7.9%, compared to 6.4% last year.
With the first half (April–September) of FY26 clocking 8% GDP growth, Nageswaran said the economy has demonstrated resilience despite global volatility. “Now we can state comfortably that the full-year growth will be either 7% or to the north of 7% rather than to the south of 7%,” he said during a press conference following the release.
However, the external environment remains challenging. Merchandise exports contracted 11.8%, reflecting the impact of higher tariffs imposed by the United States on Indian goods. “Despite the stellar efforts by exporters to find other markets, there is still a residual negative impact,” Nageswaran said. Non-oil, non-gems and jewellery exports performed marginally better but also remained weak.
Even so, he stressed that the economy has “navigated a very eventful year very well.” Earlier concerns that US tariffs could push FY26 growth closer to 6% have now receded, he added. “Sitting here on November 28th, looking at 8% growth in the first half, we are now talking about a growth rate that is either 7% or higher.”
The CEA said the economic trajectory is backed by macroeconomic stability and fiscal prudence, factors that contributed to three credit rating upgrades this year from S&P, R&I (Japan), and DBRS (US)
