Source money control
NEW DELHI – India’s economy is forecast to have delivered another quarter of robust growth, with a recent survey of economists by a leading financial news publication, mirroring other prominent polls, indicating a 7.3% expansion in the Gross Domestic Product (GDP) for the second quarter of the current fiscal year (July–September). The strong consensus points to a significant acceleration fueled by a resurgence in rural consumption and sustained government capital expenditure.
Key Growth Drivers Point to Resilience
The median estimate of 7.3% for the July-September quarter (Q2 FY26) underscores the resilience of the Indian economy amidst a globally uncertain outlook. This figure is slightly lower than the 7.8% recorded in the preceding April-June quarter (Q1), which was the fastest growth rate in five quarters. The official figures from the National Statistical Office (NSO) are scheduled for release on November 28.
Key factors contributing to the anticipated strong Q2 performance include:
Rural Demand Revival: After facing inflationary pressures, rural consumption is reportedly staging a robust rebound, supported by moderating inflation and favorable agricultural prospects. This newfound strength in the rural sector complements firm urban demand, creating a rare “twin-engine” effect.
Government Capital Expenditure (Capex): The central government’s sustained focus on capital expenditure remains a primary booster. Public spending on infrastructure surged by an estimated 31% in Q2, building on the strong momentum from Q1. This investment drives demand across industrial and infrastructure-related sectors.
Buoyancy in Services and Manufacturing: Sectors like services and manufacturing exports continue to show upbeat performance, with leading economic indicators signaling a broad-based improvement in activity.
Comparison with Official and Agency Projections
The polled estimate of 7.3% aligns closely with other forecasts, signaling confidence in India’s growth trajectory:
The Reserve Bank of India (RBI) has officially pegged the Q2 growth at 7.0%.
State Bank of India (SBI) Research has estimated an even higher growth rate of around 7.5%, citing the positive impact of GST rationalization and improved investment activity.
Rating agency ICRA projected the real GDP growth would ease to 7.0%.
The strong Q2 performance is expected to maintain India’s position as the fastest-growing major economy globally. However, some economists have flagged concerns regarding nominal GDP growth, which, if weakened, could potentially complicate government tax collections and fiscal planning in the future.
