India GDP FY26 highlights: India estimated to grow at 7.4% in FY26
Outpacing last year’s 6.5% expansion, this growth is expected to be driven primarily by the manufacturing and services sectors
Last Updated: Jan 07, 2026, 17:17 IST1 min
Prefer us on Google
Advertisement
India is set to release the first advance estimates of its gross domestic product (GDP) for the financial year 2025-26 (FY26) at 4 PM on January 7. The data, released by the National Statistical Office, will be closely watched by policymakers, investors and markets for cues on consumption trends, investment momentum and the impact of global uncertainties. It also comes ahead of the Union Budget 2026, scheduled to be presented on Sunday, February 1. Once the advance estimates are released, the government works with an assumed level of nominal GDP growth for the next financial year.
The central government has projected the real GDP for the financial year ending on March 31, 2026 to be around 7.3 percent, following an acceleration in quarterly momentum, while consumer price inflation has eased sharply to 0.71 percent as of November 2025. Consumer price inflation fell sharply to 0.71 percent in November 2025, while the unemployment rate declined to 4.7 percent in November 2025, its lowest level since April. These figures indicate accelerating growth alongside easing price pressures and improving labour market conditions going into the second half of the fiscal year.
PAST UPDATES
January 07, 2026 17:17 IST
Moderate growth forecast for private investment at 7.8%
Private investment is projected to rise by 7.8%, a slight improvement over last fiscal year’s 7.1%. However, this remains a considerable slowdown compared to the robust 8.8% growth rate recorded in FY24.
January 07, 2026 17:03 IST
Govt expenditure picks up at 5.2%
Government expenditure is projected to accelerate to 5.2% in FY26, more than doubling the 2.3% growth recorded in the previous fiscal. While this indicates a significant recovery in spending, it remains below the 8.1% growth rate achieved during the high-investment period of FY24.
January 07, 2026 16:57 IST
Private consumption is projected at 7% for FY26
Private final consumption expenditure (PFCE) is likely to grow at 7% in FY26. This is marginally lower than the 7.2% rate of growth in the previous fiscal. PFCE grew at 11.7% in FY22 in a post-pandemic recovery.
January 07, 2026 16:45 IST
ICRA expects a slowdown in H2 FY26
While the growth figures are in line with ICRA’s estimate for the fiscal, the agency projects a moderation in economic momentum for H2 FY26, with GDP and GVA growth forecast at 6.9% and 6.8%, respectively—a step down from the 7.9–8.0% recorded in the first half. This deceleration is attributed to a potential contraction in government capital expenditure, the headwind of new US tariffs on merchandise exports, and the statistical challenge of an unfavorable base.
January 07, 2026 16:32 IST
Services growth jumps to 9.1%
The services sector is projected to accelerate to 9.1% growth in FY26, up from 7.2% in the previous year. While the hotels, transport, and communication segment is slated for a steady 7.5% increase, the financial, real estate, and public administration sectors are expected to lead the charge with a robust 9.9% growth rate.
First Published: Jan 07, 2026, 15:04
Subscribe NowAdvertisement
Advertisement
Advertisement