India Defies US Tariff Pressure, Records Strong 8.2% GDP Boost

Despite pressure from US tariffs, India’s economy paced at a faster speed than expected in the last quarter, official data showing that real GDP rose 8.2% year-on-year in Q2 of FY 2025-26, well above the 5.6% recorded a year ago. The statistics ministry said the growth is the fastest rate in over a year and stronger than the 7.8% posted in the first quarter. The surge also went beyond the analysts’ forecasts of 7.4 per cent.

The latest figures, released by the National Statistics Office (NSO), indicate the spur due to higher consumer demand, solid manufacturing sector growth and a robust services sector. The latest figures reaffirm India’s position as the fastest growing major economy and will provide encouragement to the Indian policymakers grappling with a weak rupee.

Prime Minister Narendra Modi called the numbers very encouraging and thanked the hard work of Indians. “The 8.2% GDP growth in Q2 of 2025-26 is very encouraging. It reflects the impact of our pro-growth policies and reforms. It also reflects the hard work and enterprise of our people. Our government will continue to advance reforms and strengthen Ease of Living for every citizen,” he tweeted.

A major part of the acceleration came from the secondary and tertiary sectors. While the manufacturing expanded 9.1%, construction grew by 7.2% and the broader secondary sector recorded a growth of 8.1%. The services sector performed at its best. The tertiary sector also grew 9.2% accelerated by a strong 10.2% expansion in financial, real estate and professional services.

However, agriculture lagged behind as the sector grew just 3.5%, while utilities like electricity, gas and water supply grew 4.4%, indicating the need for more growth.