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India's Revised GDP Shows Bigger Economy, Stronger Manufacturing Base

India's economic growth eased to 7.8% in Q3 FY26 under the newly revised GDP series, according to SBI Research. The revision shows a significantly larger economic base due to improved data coverage and methodology, with real GDP for FY25 revised sharply upward. Manufacturing has emerged as a standout performer, recording double-digit growth across recent quarters. While the services sector maintains strong momentum, growth in agriculture and allied activities has shown some moderation.

Key Points: India's New GDP Series Shows Larger Economy, Strong Growth

  • Economy larger under new series
  • Manufacturing shows double-digit growth
  • Services sector maintains strong momentum
  • Agriculture growth moderates
3 min read

India's new GDP series shows bigger economy, stronger manufacturing base: SBI Research

SBI Research reveals India's revised GDP series presents a larger economic base with manufacturing as a key driver, despite moderated Q3 growth.

"Manufacturing has emerged as the standout performer in the revised data. - SBI Research Report"

New Delhi, Feb 28

India's revised GDP series not only present a larger economic base but also highlights the rising strength of manufacturing as a key growth driver, even as Q3FY26 growth moderated to 7.8 per cent, a new report said on Saturday.

India's economic growth eased to 7.8 per cent in the third quarter of FY26, down from 8.4 per cent in Q2, under the newly revised GDP series, data compiled by SBI Research showed.

For the full financial year FY26, growth is estimated at 7.6 per cent, slightly higher than the earlier 7.4 per cent projected under the old series, it added.

The SBI report noted that while some annual growth numbers have been revised, the size of the economy has expanded significantly in the new base year due to better data coverage and improved methodology.

FY24 growth has been revised downward to 7.2 per cent from 9.2 per cent earlier, while FY25 growth has been revised upward to 7.1 per cent from 6.5 per cent.

More importantly, the real GDP levels have seen a sharp jump. FY23 real GDP has been placed at Rs 261 lakh crore compared to Rs 161 lakh crore in the old 2011-12 series.

Similarly, FY25 real GDP has been revised to Rs 300 lakh crore from Rs 188 lakh crore earlier.

The report attributed this increase to improved coverage, use of double deflation in manufacturing and more detailed price indices.

Manufacturing has emerged as the standout performer in the revised data. The sector recorded double-digit growth of 12.7 per cent in FY24 and 11.5 per cent in FY26.

In FY26, manufacturing growth remained in double digits across all three quarters so far, expanding 10.6 per cent in Q1, 13.2 per cent in Q2 and 13.3 per cent in Q3.

According to the report, the adoption of double deflation has helped capture value addition more accurately in the sector.

The services sector has also maintained strong momentum. It is estimated to grow 9 per cent in FY26 compared to 7.9 per cent in FY24.

In Q3 FY26 alone, services grew 9.5 per cent, higher than 9.3 per cent in Q2 and 8.2 per cent in Q3 FY25.

Financial, real estate, IT and professional services recorded robust expansion of 11.2 per cent in the third quarter.

However, agriculture and allied activities showed some moderation. The agriculture, livestock, forestry and fishing sector is estimated to grow 2.4 per cent in FY26 compared to 4.2 per cent in FY25.

In Q3FY26, the sector grew 1.4 per cent, lower than 5.8 per cent in the same quarter last year, possibly due to base effects.

- IANS

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Reader Comments

P
Priya S
Good to see more accurate data, but the constant revision of past numbers is confusing for the common person. Was FY24 9.2% or 7.2%? It creates doubt. The focus should be on consistent methodology.
R
Rohit P
The jump in real GDP from Rs 161L Cr to Rs 261L Cr for FY23 is massive! This means our economy's size was underestimated. Strong manufacturing and services are driving us, though agriculture slowdown is a worry for rural incomes.
S
Sarah B
As someone working in IT, the 11.2% growth in our sector for Q3 is very encouraging. It shows resilience despite global headwinds. The overall services momentum at 9% is solid.
V
Vikram M
The report is positive, but we must not ignore agriculture growing at just 1.4%. A large part of India still depends on it. Growth needs to be inclusive. Strong manufacturing is good, but farm distress can offset gains.
K
Karthik V
Double deflation methodology sounds technical, but if it gives a truer picture of value addition in manufacturing, it's a welcome change. Hope this data helps attract more FDI into the sector. Jai Hind!

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