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2h ago

India Q1 GDP Surges to 7.8%, Beating Forecasts Before Tariff Headwinds

Economists caution the upside looks fragile due to new U.S. tariffs.

Transport trucks carry cargo containers to be loaded on the Hapag-Lloyd container ship Frankfurt Express at the DP World Centerm terminal at port, in Vancouver, on Sunday, August 3, 2025. THE CANADIAN PRESS/Darryl Dyck
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India's GDP

Overview

  • Official data show real GDP up 7.8% in April–June, with GVA at 7.6% and nominal GDP at 8.8%, the fastest real growth in five quarters.
  • Services led with about 9.3% growth, manufacturing rose 7.7%, and agriculture gained 3.7%, while mining contracted 3.1% and utilities grew 0.5%.
  • On the expenditure side, private consumption increased roughly 7.0% and investment (GFCF) rose 7.8%, supported by a sharp public capex surge, with Centre outlays up about 52%.
  • Analysts say some strength reflected exporters front‑loading shipments ahead of Washington’s tariff hikes, a boost unlikely to persist once duties of up to about 50% take full effect.
  • The Chief Economic Adviser kept the full‑year growth range at 6.3%–6.8%, framing tariffs as a reform spur, while many forecasters hold FY26 projections in the mid‑6% band and flag downside risks.