India’s Q1 FY27 GDP grows 7.8%

India’s economy expanded 7.8% year-on-year in the April–June quarter of FY27, providing an early indication of solid momentum at the start of the fiscal year. Official estimates place real GDP at constant prices at Rs 81.36 lakh crore in the quarter, compared with Rs 75.46 lakh crore in the same period a year earlier. In nominal terms, GDP at current prices reached Rs 88.27 lakh crore, up from Rs 80.00 lakh crore, representing growth of 10.3%.

The growth outturn was stronger than the Reserve Bank of India’s earlier projection of 7% for the June quarter. The data provide the first comprehensive snapshot of activity across sectors and demand components for FY27, indicating broad-based expansion rather than a narrow, sector-specific rebound.

Gross value added in the economy increased 8.2% in Q1 FY27, underscoring gains across production sectors. The services, or tertiary, sector was the main driver, expanding by about 10% in the quarter. Within services, the financial, real estate and professional services segment recorded growth of around 12.1%, highlighting particular strength in these activities.

Manufacturing and construction were also identified as contributors to the overall pickup in growth, adding to the broad-based nature of the expansion. The combined performance of goods-producing and services activities helped lift aggregate output beyond earlier expectations for the period.

On the expenditure side, private final consumption expenditure grew by about 7.1% in Q1 FY27. This indicates that household and private sector spending continued to support overall economic activity during the quarter.

Gross fixed capital formation, a key measure of investment, expanded by about 11.9% in the same period. The double-digit increase in investment points to substantial support from capital formation, complementing consumption as a driver of growth. Together, these demand components underpin the 7.8% real GDP expansion registered in the quarter.

With real GDP growth of 7.8% surpassing the earlier 7% estimate for the quarter, the new data suggest stronger-than-anticipated economic performance at the start of FY27. The combination of robust services output, expansion in manufacturing and construction, and solid contributions from both consumption and investment defines the current growth profile.

Officials have indicated that these estimates may be revised in later releases as more source data become available. For now, the figures provide a baseline view of an economy growing at a fast pace in both real and nominal terms, with broad-based support across sectors and expenditure categories.