India's Economic Surge: How 8.2% Growth Defied US Tariff Pressures

Even as the tariffs dented shipments to America, total merchandise and services exports rose 5 to 6 per cent in the quarter, due to export diversification and robust policy, a report by India Narrative said.

"Production-linked incentives lured assembly lines for phones, drugs, and solar panels, transforming India from importer to exporter. Factories, once tethered to American buyers, pivoted seamlessly to new shores," the report said.

"Infrastructure spending -- roads doubling in length, airports tripling -- slashed logistics costs, letting firms compete post-tariff. Fiscal prudence trimmed deficits without gutting capital expenditure, steadying rates and drawing foreign funds amid global flux," it added.

The report said that exports to the US, which absorbs about one‑fifth of India’s shipments, fell by double digits in key months after tariff hikes, yet total exports rose, cushioned by surges to the Gulf, Europe, Africa, and East Asia.

India's real gross domestic product growth exceeded economists’ forecasts of 7.9 per cent and was a sharp rebound from 5.6 per cent in the July–September quarter of the previous year.

Nominal growth hit nearly 9 per cent, buoyed by cooling inflation. Manufacturing surged over 9 per cent, construction topped 7 per cent, and services such as finance and real estate expanded by double digits.

"Agriculture grew modestly, in the mid-single digits, underscoring that this boom sprang from factories and urban demand, not the whims of the monsoon," the report said.

The erstwhile US-reliant Indian model has sufficiently decoupled to endure pressures, the report said, adding that the resilient consumption segment and growing manufacturing make India negotiate from strength on digital taxes, trade pacts and defence.

- IANS