India’s economic growth surged in the September quarter, as per the latest data released by the National Statistics Office (NSO). Real GDP expanded by 8.2% in the second quarter of FY 2025-26, surpassing the 5.6% growth recorded a year earlier and outperforming the 7.8% growth in the previous quarter. This growth rate marks the highest in six quarters and exceeded most predictions despite challenges from US tariffs.
The positive momentum was primarily driven by robust performances in manufacturing, construction, and the services sector. GDP at constant prices rose to Rs 48.63 lakh crore in the July-September period from Rs 44.94 lakh crore a year ago, while nominal GDP increased by 8.7% to reach Rs 85.25 lakh crore.
Prime Minister Narendra Modi expressed optimism about the numbers, attributing the growth to the impact of pro-growth policies and reforms, as well as the hard work and entrepreneurial spirit of the Indian population. Notably, the secondary and tertiary sectors played a significant role in the acceleration, with manufacturing expanding by 9.1%, construction by 7.2%, and the broader secondary sector posting an 8.1% growth.
The services sector emerged as a key performer, with the tertiary sector growing by 9.2%, fueled by a robust 10.2% expansion in financial, real estate, and professional services. Private consumption also exhibited strength, with real private final consumption expenditure (PFCE) rising by 7.9% in Q2, indicating resilient demand despite variable monsoon conditions.
However, agriculture experienced slower growth at 3.5%, and utilities like electricity, gas, and water supply expanded by 4.4%, reflecting a softer trend in these segments. The first half of FY26 witnessed an 8% GDP growth rate, an improvement from 6.1% in the corresponding period of the previous fiscal year. Real GVA growth in Q2 stood at 8.1%, supported by broad-based growth across key industries.
The better-than-expected performance reaffirms India’s position as the world’s fastest-growing major economy, setting a positive outlook for the second half of the year. Policymakers are closely monitoring inflation, consumption patterns, and global demand dynamics to sustain this growth trajectory.