New GDP series projects higher growth rate at 7.6% in FY26

India’s GDP growth estimate has been raised to 7.6 per cent for the current fiscal from 7.4 per cent after the Government revised the calculation methodology, including change in base year and adding data from GST and e-Vahan portal, to better reflect economic activities.

The Ministry of Statistics and Programme Implementation (MoSPI) on Friday released the New Series of Annual and Quarterly National Accounts Estimates with base year 2022-23, which replaces the previous series with a base year of 2011-12. This is the 9th base revision of the GDP series.

According to the new series, the gross domestic product (GDP) in the October-December quarter of 2025-26 grew by 7.8 per cent, up from 7.4 per cent in the year-ago period, mainly driven by the manufacturing and services sectors.

Further, the GDP growth for the second quarter has been revised upwards to 8.4 per cent from 8.2 per cent in the old series (base: 2011-12), while for the first quarter, it has been lowered to 6.7 per cent from 7.8 per cent.

“Real GDP or GDP at Constant Prices is estimated to attain a level of INR 322.58 lakh crore in the FY 2025-26, against the First Revised Estimate (FRE) of GDP for the year 2024-25 of INR 299.89 lakh crore. The growth rate in Real GDP during 2025-26 is estimated at 7.6 per cent as compared to 7.1 per cent in 2024-25,” MoSPI said, while releasing the new series.

The series provides the ‘Second Advance Estimates of Annual GDP for FY 2025-26’ and ‘Quarterly Estimates of GDP from Q1 (April-June) of FY 2022-23 to Q3 (October-December) of FY 2025-26’.Nominal GDP has witnessed a growth of 8.6 per cent during 2025-26.These growth rates are revised upward from their respective First Advance Estimates computed using previous base year (2011-12), MoSPI said.It further said that the economy has exhibited sustained performance, recording real GDP growth rates of 7.2 per cent and 7.1 per cent, respectively, during 2023-24 and 2024-25. Nominal GDP has registered 11 per cent and 9.7 per cent growth rates during 2023-24 and 2024-25, respectively.

“Manufacturing sector has been the major driver in contributing to the resilient performance of the economy in consecutive three financial years after rebasing. This sector has attained double-digit growth rates in 2023-24 and 2025-26,” MoSPI said.‘Trade, Repair, Hotels, Transport, Communication and Services related to Broadcasting, Storage’ sector has attained a growth rate of 10.1 per cent at constant prices in 2025-26.

On the consumption side, both the Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) have exhibited more than 7 per cent growth rate in 2025-26. The new series uses new data sources like Goods and Services Tax (GST) data, Public Finance Management System (PFMS), E-vahan, which are more comprehensive and available at a shorter time lag, and have been explored for augmenting the existing data sources for compilation and corroboration of estimates.

Further, MoSPI said that in the new series, double deflation will be used in the manufacturing and agriculture industries and single extrapolation elsewhere.As such, single deflation has been completely done away with. Besides, deflators will be used at a more granular level.

In the old series, the household sector was estimated either through inter-survey growths or through some proxy indicators.

In the new series, level estimates of the household sector will be compiled through regular surveys - Annual Survey of Unincorporated Sector Enterprise (ASUSE) and Periodic Labour Force Survey (PLFS) - conducted each year.

                 Commenting on the new series, AditiNayar, Chief Economist, ICRA, said that as per the dataset on the new 2022-23 series, India’s real GDP growth is estimated to have eased to 7.8 per cent in the third quarter of FY2026 from 8.4 per cent in the second quarter, although both numbers are healthier than what the rating agency had expected.

                 “The moderation was expectedly driven by the agriculture and the non-manufacturing industrial sectors, including mining, electricity and construction segments. Encouragingly, manufacturing GVA expanded by double digits for the fifth consecutive quarter in a row in Q3 FY2026, while services GVA growth inched up to a 7-quarter high of 9.5 per cent from 9.3 per cent in the previous quarter,” she said.