India GDP growth Q1 FY26 | India’s economy recorded a strong start to the financial year 2025-26, with GDP expanding 7.8% in the first quarter, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI). The performance came despite global challenges, including the 50% tariff imposed by US President Donald Trump.
This growth outpaced the 6.5% recorded in the same quarter last year. The services sector emerged as the key driver, supporting overall Gross Value Added (GVA) growth of 7.6% during the April to June quarter.
Strong Growth Across Key Sectors
According to the National Statistics Office (NSO), Real GDP at constant prices in Q1 FY26 stood at Rs 47.89 lakh crore, compared with Rs 44.42 lakh crore in Q1 FY25, reflecting a 7.8% increase. Nominal GDP at current prices rose to Rs 86.05 lakh crore from Rs 79.08 lakh crore a year ago, an 8.8% rise.
Real GVA was estimated at Rs 44.64 lakh crore in Q1 FY26, up from Rs 41.47 lakh crore in the same period last year, growing 7.6%. In nominal terms, GVA reached Rs 78.25 lakh crore, rising 8.8% from Rs 71.95 lakh crore.
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Agriculture and allied activities grew 3.7% in real terms, higher than last year’s 1.5%. The secondary sector also saw notable expansion, with manufacturing rising 7.7% and construction 7.6%. However, mining and quarrying contracted by 3.1%, while electricity, gas, water supply and other utility services managed just 0.5% growth.
The services sector delivered the strongest performance, growing 9.3% in Q1 FY26 compared with 6.8% in the same quarter last year.
Household Spending and Investments Boost Growth
On the expenditure side, Government Final Consumption Expenditure (GFCE) showed a significant rebound, growing 9.7% in nominal terms compared with 4.0% a year earlier. Private Final Consumption Expenditure (PFCE), a key indicator of household spending, grew 7.0% in real terms, slower than 8.3% in the corresponding period of FY25.
Gross Fixed Capital Formation (GFCF), reflecting investment activity, rose 7.8% in Q1 FY26 compared with 6.7% growth last year.
The data underscores India’s resilient economic momentum at the beginning of FY26, with GDP growth surpassing expectations despite external challenges.
