GDP Growth in FY 2024-25

The National Statistics Office (NSO) reports that India’s real GDP grew by 6.5% in FY2024-25 (April 2024–March 2025). In nominal terms, GDP rose by 9.8% to ₹330.68 lakh crore. This marks a slowdown from the roughly 7–8% real growth in FY2023-24, but remains among the higher rates globally. On a quarter-on-quarter basis, Q4 FY2024-25 (Jan–Mar 2025) saw 7.4% real GDP growth (vs. 4Q FY2023-24), with nominal GDP up 10.8%. In the latest quarter, gross value added (GVA) grew 6.8% (real) over last year’s Q4.

Public and private consumption remain key drivers. Private final consumption (PFCE) accelerated to 7.2% growth in FY2024-25 (from 5.6% in FY2023-24). Investment (gross fixed capital formation) grew 7.1% over FY2024-25, with particularly strong activity in Q4 (+9.4% in Q4). By contrast, government consumption (GFCE) growth slowed markedly: it expanded only about 2.3% in FY2024-25, down from over 8% the year before. This uneven pattern shows private demand remains robust while fiscal stimulus has tapered.

The income side also reflects healthy gains. Per capita GDP (constant prices) rose to ₹133,501 in FY2024-25, up 5.5% over ₹126,528 in FY2023-24. In nominal terms, per capita GDP reached about ₹234,859 in FY2024-25 (an 8.8% increase). Similarly, per capita net national income (NNI) and per capita consumption all saw mid‐single-digit growth. By any measure, the average Indian’s output and income grew significantly faster than population (~1.2%), keeping per capita real gains well above 4–5%.

Sectoral Composition of Growth

Services (the tertiary sector) remain the dominant driver of growth. In FY2024-25, tertiary GVA grew about 7.2%, slightly lower than the 9–10% pace of prior years. Services now account for over 54% of GDP (basic‐price GVA). Within services, high growth was seen in public administration/defence (≈8.9% YoY) and professional/financial services (~7.2%).

The secondary sector (industry and construction) posted more modest growth. Real GVA in industry grew roughly 6.1% in FY2024-25, well below the double-digit boom of 2022-23. Manufacturing output, in particular, moderated (only ~4–5% growth). Construction remained relatively strong (around 9–10% growth), but manufacturing and utilities growth lagged.

The primary sector (agriculture, mining, forestry) saw a healthy pickup, growing 4.4% in FY2024-25 versus just 2.7% last year. Agricultural output expanded ~4.6%, while mining grew ~2.7% (both faster than the prior year). Overall, the broad sectoral growth rates were: Primary ~4.4%, Secondary ~6.1%, Tertiary ~7.2%. Services still form the largest slice of the economy, so its slower growth is a key reason overall GDP growth eased to 6.5%.

Expenditure Components

The expenditure breakdown shows a renewed consumption-investment balance:

• Private consumption (PFCE): Expanded 7.2% in FY2024-25 (up from 5.6% last year), reflecting solid household demand for goods and services.

• Government consumption (GFCE): Grew only 2.3% (compared to 8.1% in FY2023-24), indicating a sharp slowdown in public spending growth.

• Gross Fixed Capital Formation (GFCF): Expanded 7.1% over FY2024-25, driven by private investment. Of this, construction and machinery investment saw the largest gains.

Thus, private demand remains the engine of growth, while fiscal support has receded. Exports and imports (net exports) added marginally to GDP, but the release does not single them out. Inventory changes also made a small positive contribution (changes in stocks grew ~4.5%).

Per Capita Indicators

On a per‐capita basis, incomes rose significantly. Per capita GDP at constant prices increased about 5–6% in 2024-25, marking steady gains in average living standards. Even in nominal terms, per‐capita GDP grew nearly 9%. Per‐capita net national income also grew mid‐single digits. Consumption per capita (PFCE per person) rose by about 6% in real terms. In short, income growth exceeded population growth, implying real per capita prosperity is rising in both rural and urban areas.

Quarterly GDP Trends

Breaking down by quarter, growth accelerated into the year-end. After slower growth earlier in FY2024-25, Q4 (Jan–Mar 2025) saw 7.4% real GDP growth (compared to 4.0% in Q3). This was led by strong performances in consumer demand and construction late in the year. Real GVA in Q4 rose 6.8%. The seasonal uptick in Q4 likely reflects festive spending and pipeline effects from investment projects. On a full‐year basis, however, the overall 6.5% reflects the average of these quarterly swings.

Index of Industrial Production (April 2025)

The MOSPI’s quick estimate for April 2025 (base 2011-12=100) shows modest growth. IIP rose 2.7% year-on-year in April 2025, down sharply from 5.2% in April 2024. This slowing mirrors subdued global demand and volatile commodity prices. On a monthly basis, April 2025’s IIP (152.0) was higher than March 2025 (which was later revised to 3.9% growth), but the YoY comparison is less favourable.

Sector wise, manufacturing led April’s growth, while mining and power lagged:

• Manufacturing: Output climbed 3.4% in April 2025 (up from 3.0% in March). Many durable‐goods industries saw gains (e.g. machinery +17.0%, auto +15.4%, basic metals +4.9%).

• Mining: Contracted 0.2% (nearly flat), reflecting weak commodity demand.

• Electricity: Grew only 1.1%, a sharp deceleration from March (+6.3%). This drag reflects moderation in power supply growth.

The composite production index stood at 152.0 in April 2025, compared to 148.0 a year earlier. (Indices: Mining 130.6, Manufacturing 149.5, Electricity 214.4 in April 2025).

IIP – Use-Based Classification

The performance by use-category (goods classification) was mixed:

• Capital goods: +20.3% (largest contributor to growth) – reflecting strong investment in machinery and equipment.

• Intermediate goods: +4.1% – moderate growth supporting upstream industry.

• Infrastructure/Construction goods: +4.0% – steady demand for construction materials.

• Consumer durables: +6.4% – healthy growth in vehicles and electronics.

• Primary goods: –0.4% – a slight contraction, as weaker mining output weighed down.

• Consumer non-durables: –1.7% – a modest decline, suggesting slower growth in everyday goods.

Thus, the IIP expansion was top‐heavy: capital and investment-related sectors drove most of the gain, while consumer essentials and mining were weak. In fact, capital goods alone contributed over half of the positive growth rate. This pattern implies a tentative pick-up in corporate capex, even as household consumer demand for staples remains subdued.

In summary, India’s economy maintained healthy growth in FY2024-25. GDP expanded 6.5% in real terms, driven by resilient services and solid consumption investment activity. The fiscal year ended on a strong note with Q4 growth of 7–8%. On the production side, industry is re-accelerating from a lull: April IIP grew 2.7% year-on-year, led by a robust manufacturing sector. Despite sectoral and policy headwinds (e.g. weak exports and tight monetary policy), these data indicate that domestic demand and investment have held up. The economy thus remains on a broad‐based expansion path, though the pace has moderated from the cycle peak and will depend on monsoon and global demand in the year ahead.

Sources: Government of India, Ministry of Statistics and Programme Implementation (MOSPI) press releases for GDP and IIP (May 2025) (see citations for detailed figures). All figures are on a year-on-year basis unless noted.