India beats Iran war blues, logs GDP growth of 7.8% in Q1FY27

Beating the Iran war blues, the Indian economy showcased a robust growth of 7.8% in the first quarter of the current financial year, compared with 6.9% in the same quarter of the previous financial year.

“Real GDP or GDP at Constant Prices in Q1 of FY2026-27 is estimated at ₹81.36 lakh crore, against ₹75.46 lakh crore in Q1 of FY 2025-26, showing a growth rate of 7.8%,” said a release from the Ministry of statistics and programme implementation on Monday.

“Nominal GDP or GDP at Current Prices in Q1 of FY2026-27 is estimated at ₹88.27 lakh crore, against ₹80.00 lakh crore in Q1 of FY2025-26, showing a growth rate of 10.3%,” the release said.

“Real GVA in Q1 of FY2026-27 is estimated at ₹73.82 lakh crore, against ₹68.21 lakh crore in Q1 of FY2025-26, showing a growth rate of 8.2%. Nominal GVA in Q1 of FY2026-27 is estimated at ₹80.53 lakh crore, against ₹72.24 lakh crore in Q1 of FY2025-26, showing a growth rate of 11.5%,” it added.

According to the data from the government, tertiary sector has boosted the performance of the economy by registering growth of 10.0% at constant prices, mainly driven by the financial, real estate, IT, and professional services sector, which has observed 12.1% growth during the Q1FY26-27.

“Secondary sector has registered a growth of 8.6% at constant prices. Primary sector has observed 2.9% growth rate at constant prices mainly contributed by the performance of agriculture and allied sector which registered 3.6% growth during Q1 of FY2026-27,” the release said.  

“On the Expenditure-side, Gross Fixed Capital Formation (GFCF) recorded double-digit (11.9%) growth rate at constant prices during Q1 of FY2026-27, against the growth of 5.8% in Q1 of FY2025-26. Private Final Consumption Expenditure (PFCE) registered a growth of 7.1% at constant prices during the quarter,” it said.

The GDP data has beaten earlier projections and estimates. Several estimates had pegged Q1FY27 GDP growth in the range of 7%-7.7%. EY India’s August Economy Watch pegged the growth in the range of 7%-7.2% and said the robust outlook is anchored by an aggressive frontloading of capital expenditure. The agency said the capital expenditure surged by 23.7% in the first quarter of the fiscal.

SBI Research and YES Bank too had earlier said Indian economy is likely to have remained resilient in the April-June quarter (Q1) of FY27, with consumption, investment, and industrial activity holding up despite weak monsoons, geopolitical disruptions, and higher crude oil prices.

SBI Research estimates India’s GDP growth at 7% in Q1FY27 while YES Bank has raised its estimate to 7.7% from 7.1% earlier. YES Bank also upgraded its full-year FY27 growth forecast to 6.8% from 6.6%, above the Reserve Bank of India’s latest projection of 6.7%.