Key Highlights

• India’s real GDP grew 8.2% YoY in July–September 2025

• Manufacturing surged 9.1%, while construction grew 7.2%

• Services sector expanded ~9.2%, led by finance, real estate and professional services

• Private consumption rose ~7.9%, showing strong household demand

• Overall GVA increased ~8.1%, reflecting broad-based economic strength

India’s Real GDP Growth Accelerates to 8.2 Percent in July–September Quarter

India recorded a strong 8.2% growth in real GDP during the July–September 2025 quarter, marking a clear improvement from 7.8% in the April–June period. The rise in economic activity was driven by a sharp rebound in manufacturing, healthy construction activity, and continued strength in key service industries.

Alongside sectoral gains, private consumption remained strong at around 7.9%, supported by stable inflation, improving income levels and pre-festival buying. Overall, Gross Value Added (GVA) rose by about 8.1%, signalling a steady and broad recovery across the Indian economy.

Sector-Wise Breakdown : What Drove the Growth

1. Secondary Sector : Manufacturing, Industry and Construction

The secondary sector played a key role in lifting overall GDP.

• Manufacturing grew 9.1%, a major jump compared to ~2.2% growth a year ago.

• Construction expanded 7.2%, supported by housing demand, infrastructure projects and real estate activity.

• Combined, the secondary sector grew around 8.1%, showing a clear industrial revival.

Key segments such as automobiles, capital goods, consumer durables, electronics and other manufacturing-heavy industries likely supported this uptick, especially with higher industrial output and pre-festival stocking.

2. Tertiary Sector : Services Lead the Charge

Services continued to be the strongest pillar of the economy.

• The services sector grew around 9.2%, powered by financial services, real estate and professional services.

• Other services such as trade, hotels, transport and communications also showed steady growth due to strong consumer demand and easing inflation.

Since services contribute more than 55% to India’s GDP, their strong performance played a major role in the overall economic gain.

3. Primary Sector : Agriculture and Allied Activities

The primary sector grew at a more modest pace.

• Agriculture and allied activities expanded around 3.5%, offering stability but not significantly boosting overall GDP.

• While agriculture remains vital for rural livelihoods, its contribution this quarter was lower compared to industry and services.

Demand-Side Drivers : Consumption and Investment

Private Consumption Rising

Private final consumption expenditure increased by roughly 7.9%. Key factors included:

• Pre-festival demand

• Low inflation (stable CPI)

• Higher disposable incomesThis shows that both urban and rural consumption remained firm.

Strong Investment Activity

Investment momentum stayed encouraging, supported by:

• Higher capacity utilisation in manufacturing

• Ongoing infrastructure and construction work

• Continued government capital expenditure

These elements together strengthened capital formation and supported overall economic output.

Broader Implications : What This Growth Signals

The strong performance in manufacturing and construction suggests that India’s long-awaited industrial comeback is gaining pace. Raising manufacturing’s GDP share beyond the usual 14–17% remains a key long-term goal—and this quarter shows progress in that direction.

The services sector, meanwhile, continues to act as the backbone of the economy, reaffirming India’s position as a service-led growth model.

Steady private consumption highlights a resilient domestic market that can cushion the economy against weak global demand, geopolitical risks or external trade pressures.

However, the modest growth in agriculture and risks from global uncertainties indicate that India must keep strengthening all major sectors to ensure stable and balanced growth.

Final Word

The 8.2% GDP growth in Q2 FY26 is more than just a strong headline - it reflects a broad and balanced economic recovery. With manufacturing picking up, construction holding firm and services powering ahead, India is displaying a healthier mix of sectoral growth.

For long-term stability, this balanced pattern is encouraging. It supports job creation, better income stability and a more resilient economy. Yet, to maintain this momentum, agriculture and external-facing sectors will need sustained focus.

If India continues on this broad-based path, it can strengthen its position as one of the world’s fastest-growing major economies in the years ahead.

Source

1. Reuters – India’s GDP growth in July–Sept quarter (8.2%)

2. Reuters – Private consumption growth (~7.9%) and overall macro commentary

3. Moneycontrol – Manufacturing & construction trends; GVA ~8.1%

4. Economic Times – Sector-wise growth: manufacturing 9.1%, construction 7.2%, services 9%+

5. Indian Express – Additional confirmation of GDP performance and sector rebound