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India's Q3 FY26 GDP Growth to Hit 8% Despite Global Challenges

India's GDP growth for the third quarter of FY26 is projected to reach 8-8.1%, according to an SBI Research report, indicating resilient economic activity. The growth is supported by robust rural consumption and a sustained uptick in urban demand following fiscal stimulus. Concurrently, India is preparing to release updated GDP data with a new base year of 2022-23, aiming to better capture the modern economic structure, including digital commerce. The methodological overhaul, incorporating sources like GST data, could potentially position India as the world's fourth-largest economy.

Key Points: India GDP Growth to Cross 8% in Q3 FY26: SBI Report

  • Q3 FY26 GDP seen at 8-8.1%
  • Strong rural and urban consumption drivers
  • GDP base year revision to 2022-23 imminent
  • New data to include GST, e-Vahan records
  • Global growth uneven amid geopolitical tensions
2 min read

India's GDP growth likely to cross 8 pc in Q3 FY26 despite global headwinds: SBI report

SBI Research forecasts India's Q3 FY26 GDP growth at 8-8.1%, driven by strong rural and urban consumption, amid a major statistical base year revision.

"Rural consumption remains strong... urban consumption shows a consistent uptick - Dr. Soumya Kanti Ghosh"

New Delhi, Feb 24

India's GDP growth in the third quarter of FY26 is likely to come at 8-8.1 per cent, an SBI Research report said on Tuesday, adding that the domestic economy has maintained strong growth momentum despite global headwinds.

High-frequency activity data indicates resilient economic activity in Q3 FY26 (October-December 2025).

"Rural consumption remains strong, driven by positive signals from farm and non-farm activity. Supported by fiscal stimulus, urban consumption shows a consistent uptick since the last festive season," said Dr. Soumya Kanti Ghosh, Group Chief Economic Adviser, State Bank of India.

As per the first advance estimate, GDP is estimated to growth at 7.4 per cent in FY26, with growth largely driven by domestic demand.

India is updating its GDP base year from 2011-12 to 2022-23, with the new series scheduled for release on February 27.

This revision, along with an updated CPI base (2024), aims to better reflect the current economic structure, including increased digital commerce and service.

The overhaul includes better measurement of the informal sector and new data sources like GST, potentially placing India as the world's fourth-largest economy.

"Given significant methodological changes and new data series to be released, it is difficult to predict the extent of revision," said the report.

The new methodology will incorporate more granular data, including GST records, e-Vahan (vehicle registrations), and information on natural gas consumption.

The Second Advance Estimates of GDP for 2025-26 along with past 3 financial years' GDP estimates as well as Quarterly GDP estimates as per the new base 2022-23 will be released on February 27.

As per the latest Economic Survey, India's potential GDP is estimated to be around 7 per cent and estimated to grow in the range of 6.8-7.2 per cent during FY27.

Meanwhile, the global economic environment is characterised by high uncertainty, with growth projected at 3.3 per cent both in 2025 and 2026 but remain uneven elsewhere due to geopolitical tensions, high debt, and structural shifts like digitalisation and decarbonisation.

- IANS

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Reader Comments

R
Rohit P
While the headline number looks great, I hope this growth is translating into more jobs and better wages for the average person. The report mentions urban consumption is up, but are salaries keeping pace with inflation? That's the real question.
A
Aman W
Updating the GDP base year is a crucial step. Our economy has changed massively since 2011-12 with UPI, digital payments, and e-commerce. The new data from GST and e-Vahan will give a much more accurate picture. Good move!
S
Sarah B
As someone working in the renewable energy sector, I'm glad to see the report acknowledging structural shifts like decarbonisation. India's growth story needs to be sustainable. Hoping the new GDP methodology reflects investments in green tech properly.
V
Vikram M
Fourth largest economy here we come! 🚀 The momentum is undeniable. The festive season boost seems to have carried forward. Let's see what the revised numbers on the 27th say. Fingers crossed!
K
Karthik V
A respectful criticism: We must be cautious. The report itself says it's difficult to predict the extent of revision with the new methodology. While optimistic, we should wait for the actual data release before celebrating too much. Data transparency is key.
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Nisha Z
Including better

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