India’s economy is estimated to grow at 7.4% in real terms in the financial year 2025-26 (FY26), up from 6.5% in the previous year, according to the First Advance Estimates released by the National Statistics Office on Wednesday. The RBI has predicted the GDP growth at 7.3% for FY26.
The growth is largely propelled by a strong performance in the services sector, which saw a 9.1% expansion in real Gross Value Added (GVA). Within services, the Financial, Real Estate & Professional Services and Public Administration, Defence & Other Services segments recorded a remarkable 9.9% growth at constant prices.
The secondary sector, comprising manufacturing and construction, is estimated to grow at 6.6%, indicating steady industrial activity. Manufacturing GVA in real terms grew at 7%, higher than 4.5% in the previous year. However, the primary sector—agriculture and mining—showed moderation, with growth at 2.7% in real GVA terms compared to 4.4% in the previous year.
Nominal GDP is projected to grow at 8.0% in FY 2025-26, reaching Rs 357.14 lakh crore. At an average dollar-rupee exchange rate of 88, India’s GDP has crossed the $4 trillion mark in FY26.
On the expenditure side, private consumption (PFCE) is expected to grow at 7.0%, while investment, reflected in Gross Fixed Capital Formation (GFCF), is estimated to rise by 7.8%, signalling continued capital spending in the economy.
The estimates are based on key indicators such as industrial production, corporate financial results, agricultural output, tax collections, and trade data, incorporating information available up to November 2025.
The Ministry of Statistics also noted that a revision of the national accounts base year from 2011–12 to 2022–23 is underway, which may lead to updates in subsequent estimates. The Second Advance Estimates for FY 2025-26 will be released on February 27, 2026.