What’s Driving India’s Economic Growth? Insights for 2025-26

Indian Economy Set for Growth Surge

New Delhi: Projections indicate that the Indian economy is poised to expand by 7.4% in the fiscal year 2025-26, a notable increase from the 6.5% growth recorded in the previous year, driven primarily by advancements in the manufacturing and services sectors, according to data released by the government on Wednesday.

The Ministry of Statistics & Programme Implementation (MoSPI) has published its first advance estimates of national income, forecasting a growth rate of 7% for both manufacturing and construction sectors.

MoSPI highlighted that the robust performance of the services sector is a significant contributor to the anticipated real GVA (gross value added) growth rate of 7.3% for FY 2025-26.

Conversely, the agriculture and allied sectors, along with the 'electricity, gas, water supply, and other utility services' sectors, are expected to experience only moderate growth in the current fiscal year ending March 31.

Additionally, the ministry noted that the nominal GDP, or GDP at current prices, is projected to grow by 8% during 2025-26.

These advance estimates will play a crucial role in shaping the Union Budget, which is expected to be unveiled on February 1.