In a major boost to global confidence in the Indian economy, the National Statistics Office (NSO) on Friday, November 28, 2025, released data showing that India’s Real Gross Domestic Product (GDP) grew at a robust 8.2% year-on-year in the second quarter (July–September) of the financial year 2025-26 (Q2 FY26).
This figure marks the highest growth rate in six quarters, significantly surpassing the 5.6% recorded in the corresponding period last year and exceeding market expectations, which had generally clustered around the 7.3% mark. The stronger-than-expected print reinforces India's position as the world's fastest-growing major economy.
Sectoral Highlights: Manufacturing Leads the Charge
The acceleration was broadly based across the Secondary and Tertiary (Services) sectors, indicating a healthy revival across multiple industries.
| Sector | Q2 FY26 Real Growth Rate (YoY) | Key Drivers |
| Manufacturing | 9.1% | Strong industrial output, pre-festive inventory build-up, and higher government capital spending. |
| Tertiary (Services) | 9.2% | Led by Financial, Real Estate & Professional Services surging at 10.2% |
| Construction | 7.2% | Sustained public and infrastructure spending. |
| Secondary Sector (Overall) | 8.1% | Broad-based performance across manufacturing and construction. |
| Agriculture & Allied | 3.5% | Moderate growth, reflecting a softer patch compared to industry. |
Consumption and Demand Remain Robust
The data highlighted strong traction in domestic demand, a key pillar of India's resilience.
- Private Consumption: Real Private Final Consumption Expenditure (PFCE), which accounts for nearly 60% of GDP, grew by 7.9% in Q2 FY26, up from 6.4% in the same period last year. This signals a healthy recovery in household demand, supported by improved rural spending.
- First Half Performance: Due to the strong Q2 performance, the Real GDP growth for the entire first half (April–September) of FY26 stands at a remarkable 8.0%, a significant jump from 6.1% in the first half of the previous fiscal year.
Economic Outlook and Policy Implications
The blockbuster numbers set an optimistic tone for the remainder of the fiscal year, though global uncertainties and slowing growth in the primary sector (agriculture) remain factors to monitor.
- FY26 Outlook: Economists are now reviewing their full-year forecasts, with many suggesting that the final FY26 growth rate could potentially exceed the Reserve Bank of India’s (RBI) current projection.
- Monetary Policy: The surprisingly high growth print may temper expectations of an immediate interest rate cut by the RBI in its upcoming December review, as the central bank balances growth momentum against managing inflationary pressures.
The robust Q2 GDP performance solidifies India's narrative of economic resilience, proving that strong domestic factors can successfully counter global headwinds, including complex geopolitical trade tariffs.
