India’s GDP grew by 7.8% in the June quarter of FY27, surpassing estimates amid geopolitical tensions and regional uncertainties, with broad-based strength across manufacturing, services, and investment.
India’s economy expanded 7.8% in the June quarter of FY27, underscoring resilient activity even as the West Asia conflict weighed on the global outlook. The National Statistics Office said the pace was slower than the 8.6% recorded in the previous quarter, but still well above many forecasts. Gross value added rose 8.2%, suggesting broad-based strength beneath the headline GDP figure.
The latest numbers point to a solid contribution from manufacturing, which accelerated to 9.2%, while the financial, real estate and information technology segment posted 12.1% growth. Agriculture also held up, rising 3.6% despite the delayed monsoon. On the demand side, investment remained a bright spot: gross fixed capital formation grew 11.9%, compared with 5.8% in the same quarter a year earlier.
The June quarter result beat a range of private estimates. India Ratings & Research had projected 6.9% growth, while State Bank of India had expected 8%, according to Business Standard. ICRA had warned that West Asia tensions and monsoon uncertainty could trim momentum, while also pointing to weaker services indicators and pressure on oil refining margins. The finance ministry’s monthly economic review said the economy retained growth momentum in Q1 FY27, even as some high-frequency indicators softened.
The broader picture is one of strength tempered by risks. Business Standard reported that industrial output, services purchasing managers’ index readings, domestic aviation traffic and bank credit improved sequentially during the quarter, although manufacturing PMI, e-way bills, auto sales, fuel use and rural job-guarantee demand eased. India Ratings has since warned that full-year growth could slow to 6.8% in FY27, citing inflationary pressure from energy and food costs, currency weakness and the possibility of El Nino-related stress on agriculture.
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