New Delhi: India’s real GDP is projected to expand by 7.4 per cent in the 2025-26 financial year, up from 6.5 per cent in 2024-25, according to advanced estimates released by the Ministry of Statistics on Wednesday.

The services sector is expected to be a key driver, with financial services, real estate, professional services, and public administration estimated to grow by 9.9 per cent at constant prices. Trade, hotels, transport, communication, and broadcasting-related services are forecast to expand by 7.5 per cent.

The secondary sector, comprising manufacturing and construction, is projected to grow by 7 per cent, while agriculture is expected to expand by 3.1 per cent. Real private final consumption expenditure (PFCE) is estimated to rise 7 per cent, supported by recent income tax exemptions and GST rate cuts, while gross fixed capital formation (GFCF) is expected to grow 7.8 per cent, up from 7.1 per cent in the previous year.

The economy has already shown strong momentum, with GDP rising 8.2 per cent in the second quarter (July–September) of FY 2025-26, compared with 5.6 per cent in the same period last year. The secondary and tertiary sectors grew 8.1 per cent and 9.2 per cent respectively, while manufacturing surged 9.1 per cent and construction 7.2 per cent. The financial, real estate, and professional services segment recorded double-digit growth of 10.2 per cent.

Agriculture and allied activities posted 3.5 per cent growth, while electricity, gas, water supply, and utilities grew 4.4 per cent. PFCE rose 7.9 per cent in Q2, reflecting higher incomes and increased employment. With a 7.8 per cent expansion in Q1, India’s GDP for the first half of FY 2025-26 stands at 8 per cent, compared with 6.1 per cent in H1 of FY 2024-25.

The data underscores India’s position as the world’s fastest-growing major economy, despite global headwinds such as US tariff hikes. The IMF has forecast India to be the only economy expected to achieve over 6 per cent growth in 2025-26 amid slowing global trade.

IANS