In a striking display of economic resilience, SBI Research projects India’s GDP to grow between 8 and 8.1 percent in Q3 of FY 2025-26, shrugging off international headwinds. Released on Tuesday, the report underscores how India’s internal dynamics are powering ahead.
Key high-frequency data reveals sustained vigor in economic activities through the October-December quarter. Rural spending holds strong, supported by favorable farm outputs and rural non-farm jobs. Meanwhile, city dwellers are ramping up purchases, thanks to government fiscal pushes and lingering festive momentum.
‘Strong rural consumption, backed by agriculture and allied activities, combined with urban recovery, forms the bedrock of this growth,’ stated Dr. Soumya Kanti Ghosh, SBI’s top economist. The overall FY26 growth is pegged at 7.4 percent, predominantly driven by domestic consumption.
A major revamp is on the horizon: India’s GDP series will shift its base to 2022-23 from 2011-12, with announcements due February 27. Paired with CPI base year update to 2024, this will reflect modern realities like booming e-commerce and service sectors more precisely.
Enhanced data integration from GST, electric vehicle sales, and gas usage will refine informal economy estimates, potentially elevating India’s global economic stature to fourth place. Though revision magnitudes are hard to predict amid these changes, comprehensive GDP updates for recent years are forthcoming.
The Economic Survey echoes this optimism, estimating current potential GDP at 7 percent and FY27 growth between 6.8-7.2 percent. Globally, however, the outlook is dimmer with 3.3 percent growth forecasted amid geopolitical risks, debt burdens, and tech-driven shifts. India’s story stands out as a beacon of stability and progress in turbulent times.