New Delhi: India’s economy has once again proved its resilience. Even as the US slapped fresh tariffs and former President Donald Trump dismissed the Indian economy as “dead,” official data released on Friday shows the country posted a 7.8% GDP growth in the first quarter of FY 2025-26, beating market expectations of 6.5%.
At constant prices, India’s GDP stood at ₹47.89 lakh crore, up from ₹44.42 lakh crore in the same quarter last year. In nominal terms, GDP expanded 8.8% to touch ₹86.05 lakh crore.
Services Lead the Surge
The services sector remained the growth engine, soaring 9.3%, significantly higher than the 6.8% growth recorded a year ago. Strong momentum in financial services, trade, transport, and communications pushed the numbers up.
Manufacturing and Construction on Strong Footing
The manufacturing sector expanded 7.7% and construction rose 7.6%, both reflecting healthy industrial activity and infrastructure push. Agriculture too provided a positive surprise, with 3.7% growth compared to 1.5% in the same quarter last fiscal.
Weak Spots Remain
Not all sectors painted a rosy picture. Mining and quarrying contracted 3.1%, while electricity, gas, water supply, and other utilities grew by a mere 0.5%, signalling sluggishness in energy-related activities.
Spending and Investments Bounce Back
Government expenditure provided a boost, with Government Final Consumption Expenditure (GFCE) jumping 9.7%, more than double last year’s 4%. Private consumption, however, slowed, recording 7% growth, down from 8.3% in the corresponding quarter.
Capital formation was another bright spot. Gross Fixed Capital Formation (GFCF) rose 7.8%, up from 6.7% last year, indicating stronger investment activity.
Economy Remains World’s Bright Spot
The numbers reinforce India’s position as the fastest-growing major economy in the world, standing in stark contrast to Trump’s recent jibe calling the economy “dead.” Economists say the data reflects resilience in domestic demand, supportive government spending, and a structural shift toward high-growth sectors like services and construction.
“Despite external headwinds and tariff challenges, India’s economic fundamentals remain strong,” an analyst noted, adding that the robust Q1 data could pave the way for sustained momentum through the year.
