India Becomes the Fastest-Growing Economy in the World with 8.2% GDP Growth

India Becomes the Fastest-Growing Economy in the World, Records 8.2% Growth

In the second quarter of the current financial year 2025–26, India’s GDP growth rate reached 8.2%, the highest in the last six quarters. Strong performance in the manufacturing and service sectors, coupled with rising exports, contributed significantly to this growth. The Chief Economic Adviser has estimated that the growth rate will remain above 7%. Both the Finance Minister and the Prime Minister attributed this achievement to the government’s reforms and policies.

Defying estimates made by many economists and even the RBI, India’s GDP growth for Q2 (July–September) of FY 2025–26 surged to 8.2%. This is the highest quarterly growth in six quarters and once again places India ahead of all major global economies in terms of economic expansion. In Q1 of the current financial year, GDP growth stood at 7.8%.

How Did GDP Reach 8%?

Due to this strong momentum, India’s GDP growth for the first half of the financial year (April–September) stood at 8%. Considering this performance and the positive trend across various economic indicators, Chief Economic Adviser V. Anantha Nageswaran projected that growth for the full fiscal year will remain above 7%.

India’s economy is also on track to cross the $4 trillion mark by the end of the current financial year. The excellent performance of the manufacturing and services sectors in Q2 played a key role in pushing growth beyond 8%.

Growth Across Key Sectors

Compared to Q2 of the previous financial year, the services sector grew by 9.2% and manufacturing by 9.1%. According to government data, GDP for Q2 of FY 2025–26 reached ₹48.63 lakh crore, compared to ₹44.94 lakh crore in the same quarter last year.

Lower inflation—below 2%—and a decline in food prices also helped accelerate economic growth. Exports performed strongly during July–September, which further boosted GDP. The U.S. decision to impose a 50% tariff on certain Indian goods took effect only in late August, so exports during July–August remained robust.

Reaction from Finance Minister and Prime Minister

Finance Minister Nirmala Sitharaman wrote on X that the strong Q2 GDP numbers are a result of the government’s consistent focus on fiscal stability, public investment, and structural reforms.

She added that rising consumption and strengthening indicators suggest continued economic resilience. Prime Minister Narendra Modi said this growth reflects the positive impact of policies and reforms undertaken by the government. He stated that the efforts of citizens and entrepreneurs are equally responsible for this achievement, and the government will continue advancing reforms to improve lives.