India's GDP Grows 8.2% in Q2 Thanks to Manufacturing and Services Boom

Post by : Raina Nasser

In a remarkable display of economic resilience, India recorded a substantial real GDP growth of 8.2% for the second quarter of the 2025-26 fiscal year, as reported by the National Statistics Office (NSO). This figure not only surpasses last year's 5.6% growth in the same period but also outstrips the 7.8% growth from the first quarter, thus highlighting a strong economic trajectory amidst external factors like US tariffs.

The new data highlights significant momentum in essential sectors, led by manufacturing, construction, and services. For the July-September quarter, the GDP at constant prices hit Rs 48.63 lakh crore, up from Rs 44.94 lakh crore a year ago. The nominal GDP also increased by 8.7%, reaching Rs 85.25 lakh crore, indicating a robust price-adjusted growth.

The manufacturing sector grew by 9.1%, while construction saw a 7.2% increase, contributing to an overall secondary sector growth of 8.1%. Notably, the services sector emerged as the leading economic driver, expanding by 9.2%, buoyed by a remarkable 10.2% growth in financial, real estate, and professional services. This stellar performance positions India as a burgeoning global hub for services, expertise, and industrial production.

Private consumption showed consistent growth, with real private final consumption expenditure (PFCE) increasing by 7.9% in Q2, compared to 6.4% the previous year. This trend points toward sustained domestic demand, even in the face of uneven monsoon impacts on agricultural yields. Conversely, agriculture reported limited growth at 3.5%, while utilities such as electricity, gas and water supply grew by 4.4%, reflecting a temporary slowdown in these sectors.

In total, India achieved an 8% GDP growth rate in the first half of FY26, an increase from 6.1% during the same timeframe last year. The Real Gross Value Added (GVA) for the second quarter recorded a growth of 8.1%, indicative of expansion across numerous industries.

Policymakers and analysts regard these statistics as a strong affirmation of India's emerging status as the fastest-growing major economy globally. This promising growth trajectory sets an optimistic tone for the latter half of the fiscal year, with ongoing scrutiny on inflation, consumption trends, and global demand influencing future policy initiatives. India's sustained economic vigor, propelled by manufacturing and services, not only consolidates its global growth reputation but also reflects robust domestic demand and industrial growth as it moves further into FY26.

This robust performance illustrates India's capability to navigate external challenges while sustaining strong internal economic vigor, reinforcing its attractiveness as a destination for investment and business ventures worldwide.