India’s gross domestic product grew 7.8% in the October-December quarter compared with the same period a year earlier, the government announced on Friday, following a stronger 8.4% print in the prior quarter. The update came as officials published a revamped series of national output data intended to better reflect current production structures and capture broader segments of economic activity.
Alongside the quarterly figure, the National Statistics Office said it now expects the South Asian economy to expand by 7.6% for the fiscal year ending in March. That projection is higher than the 7.4% that had been forecast under the previous data series.
Observers and economists flagged that the methodological overhaul underpinning the rebased data has altered historical estimates and, in some cases, lifted measured growth. Several analysts described the changes as improving sectoral representation and reducing distortions related to deflators while also incorporating wider coverage of previously undercounted segments.
MADHAVI ARORA, CHIEF ECONOMIST, EMKAY GLOBAL FINANCIAL SERVICES, MUMBAI: "The revised GDP series, featuring improved sectoral representation, reduced deflator-related distortions, and a more comprehensive capture of economic activity, has led to a recalibration of historical data. The FY26 Second Advance Estimate now projects real GDP growth at 7.6%, up from the 7.4% in the First Advance Estimate. This follows a stronger FY25 print of 7.1% (revised up from 6.5% under the earlier base)."
RADHIKA RAO, SENIOR ECONOMIST, DBS BANK, SINGAPORE: "At first glance, the momentum in the rebased growth numbers appears to be marginally stronger than the previous trend, with methodological changes expected to have captured updated production structures, wider coverage of segments, new ratios, and improved government data sets, including those that capture activity in the informal sector. Service sector performance signals a strong lift, besides double-digit growth in manufacturing. The October-December quarter also benefited from indirect tax rationalisation and festive demand, in addition to a better faring rural farm sector. The rebased numbers are close to our forecast of 7.7% YoY for FY26."
SUJAN HAJRA, CHIEF ECONOMIST & EXECUTIVE DIRECTOR, ANAND RATHI GROUP, MUMBAI: "India’s GDP data for Q3 FY26 and the Second Advance Estimates for FY26 have both come in above 7.5%, marginally exceeding our expectations. Importantly, the headline GDP and GVA trajectories under the new series are not materially different from those under the old series, suggesting continuity in the underlying growth narrative rather than a statistical distortion. That said, nominal GDP growth for the year continues to remain below 9%, implying that while real activity is robust, the nominal backdrop - crucial for revenue buoyancy and profit growth - is relatively contained. These better-than-expected numbers have clear market implications. For equities, the improved growth impulse strengthens the outlook for corporate earnings, especially for cyclical and domestic-demand-oriented sectors. For the debt market, stronger real growth - even with moderate nominal expansion - improves the outlook for government finances by supporting tax collections and reducing fiscal slippage risks."
ALEXANDRA HERMANN, LEAD ECONOMIST AT OXFORD ECONOMICS, UNITED KINGDOM: "The GDP data exceeded both our and consensus expectations, although the methodological changes mean that like-for-like comparisons are not straightforward. The improved capture of faster-growing segments of the economy suggests that the measured growth trajectory is likely to be structurally higher under the new series. With food price volatility set to play a smaller role for headline inflation and measured growth stronger following the methodological revisions to both inflation and the national account series, further rate cuts look highly unlikely. In fact, firm demand pushing up core inflation skews risks toward a rate hike before end-2026, in our view."
The rebasing and methodological changes appear to have several implications discussed by the economists quoted. They point to a somewhat stronger measured momentum in growth driven by services and manufacturing, along with potentially improved capture of informal-sector activity. Analysts also noted that indirect tax rationalisation and seasonal festive demand supported the October-December quarter, while rural farm sector performance contributed to the strength in activity.
At the same time, some commentators emphasized that the new series does not necessarily upend the underlying growth story. One economist noted that headline GDP and GVA trajectories remain broadly consistent with earlier series, indicating continuity rather than a purely statistical uplift. Nonetheless, the revisions raise questions about nominal GDP dynamics, with one observer highlighting that nominal growth remaining below 9% could temper revenue and profit expansion despite robust real activity.
Market implications highlighted by analysts include a more favorable earnings outlook for companies exposed to domestic cyclical demand and a potentially improved fiscal position through strengthened tax receipts. Conversely, shifts in measured growth and inflation dynamics may influence expectations for monetary policy, with at least one forecaster suggesting that the revised data reduce the likelihood of future rate cuts and could tilt risks toward a rate increase before the end of 2026.
Beyond the numerical revisions, economists cautioned that methodological changes complicate direct comparisons with past series and that analysts and market participants should factor in the new coverage and deflator treatments when interpreting the updated GDP path.