India’s economy posted a sharp acceleration in the July–September quarter, growing 8.2 percent — its fastest pace in six quarters — comfortably beating market expectations and underscoring the resilience of domestic demand despite tariff-related uncertainties.
Fresh data released by the Ministry of Statistics and Programme Implementation on Friday showed that robust manufacturing and steady consumption helped lift second-quarter growth. A favourable statistical base and soft inflation further flattered the headline number.
The outturn far exceeded the 7.2 percent median estimate of 15 economists polled by Mint, who had projected growth in the 7–7.7 percent range. It also topped the Reserve Bank of India’s most recent estimate of 7 percent for the quarter.
With GDP surpassing the RBI’s forecast by more than one percentage point, the central bank may find it harder to justify a rate cut at its December 3–5 policy meeting — even though a 25-basis-point easing remains the consensus expectation. The stronger-than-expected print reinforces the argument for caution as the monetary authority weighs lingering external risks.
Growth had eased to 5.6 percent in the same quarter a year ago. The economy expanded 7.8 percent in the April–June period (Q1 FY26) after recording 7.4 percent growth in Q4 FY25.
For the full year, the RBI has projected GDP growth of 6.8 percent, with 6.4 percent and 6.2 percent expected in the December and March quarters, respectively. The sizeable upside surprise in Q2 could prompt an upward revision when the monetary policy committee meets next week, even if the central bank holds on to its second-half forecasts.
Beyond the statistical lift, high-frequency indicators had already pointed to strengthening momentum through the quarter, even before GST rate cuts took effect from September 22. Economists note that easing inflation, the pass-through of earlier monetary policy loosening, and inventory stocking ahead of the festive season added further impetus.
Yuvika Singhal of QuantEco Research said softer price conditions, improved monetary transmission, and inventory build-up in select industries — a trend reinforced by the GST cuts — helped bolster activity during the period.
(By arrangement with livemint.com)