India’s economy has outperformed expectations in the first quarter of the 2026-27 financial year. The country’s GDP growth was 7.8% in April-June 2026. This is much higher than the record revised growth of 6.9% in the same quarter last year. The most important thing is that the GDP growth in the first quarter is much better than the estimates of economists. At such a time, the growth of 7.8% shows the strength of the Indian economy.
Similarly, due to the conflict in West Asia, there was pressure on crude oil prices, supply chains and commodity markets. The growth in the April-June quarter was the same as the previous quarter’s 7.8%. Similarly, the gross value added or GVA, which shows the real activity in the economy, grew by 8.2%. Similarly, last year at this time it was 7.1%. Nominal GDP growth was 10.3%, which was 8.1% the year before last. After this strong figure, PM Modi has highly praised India’s economic strength. Along with this, he also targeted those who criticize the government.
Growth in the manufacturing sector
The largest contribution to the GDP figure is found in the private consumption, government capital expenditure, manufacturing and service sectors. In the first quarter, the central government increased capital expenditure by 18.6%. Similarly, its growth in the last quarter was 9.1%. This is directly due to construction and industrial activities. The manufacturing sector has shown a growth of 9.2%, which is higher than the growth of 8.3% last year.
Big improvement in the electric sector
The electric sector has also seen a big improvement. Its growth has increased to 8.9%. Similarly, last year, this sector was at 1.8%. The construction sector also grew by 7.7%. Similarly, its growth in the same quarter of last year was 5.2%. In industrial production, the average growth during the first quarter was 5.7%, which is better than the 3.8% in the previous quarter. Domestic demand can be seen from the fact that passenger vehicle sales have grown by an average of 25.6% in Q1FY27.
Growth in the agriculture sector has decreased
If the performance of each sector is not strong. The growth of the agriculture sector has decreased to 3.6% from 4.4% last year. The pressure is on the mining sector, which has resulted in a decline of 2.4%. Similarly, this sector recorded a growth of 12.4% in the same quarter last year. On the other hand, the services sector has consistently become a strong base of the economy. Financial, real estate and professional services have grown by about 12%. The growth of services exports has also increased from 8.9% in the last quarter to 13.1%. Similarly, the cut in GST rates and its income tax relief last year have also supported the disposable income and spending power of the people.
More than 85% of crude oil imported
Now the biggest question is whether this rapid GDP growth will continue? Economists believe that there may be some slowdown in the second and third quarters. India imports more than 85% of its crude oil requirements. If crude oil prices remain above $90 per barrel for a prolonged period, then inflation and production cost pressures will increase. This is also supported by strong domestic demand, government investment, manufacturing and service sectors, which are positive signs for India.
