India’s GDP to grow 7.6 pc in FY26 after revamp of calculation framework

New Delhi, Feb 27: India’s economic growth estimate was raised to 7.6 per cent for the current fiscal on Friday following a revamp of the GDP calculation framework, underscoring the resilience of the world’s fastest-growing major economy amid global trade disruptions.

The growth forecast for the fiscal year ending March, released by the National Statistics Office under a new series of national accounts, compares to the previous estimate of 7.4 per cent under the old data series, and 7.1 per cent in the previous 2024-25 fiscal year.

The calculation revamp, which included a change of base year to 2022-23 and improved capture of faster-growing segments of the economy, however, led to a moderation in real GDP growth in October-December (the third quarter of the current 2025-26 fiscal year) to 7.8 per cent from 8.4 per cent in Q2.

The methodological overhaul, aimed at addressing concerns over outdated data practices and improving accuracy, is expected to better reflect updated production structures, expand sectoral coverage, incorporate revised ratios, and utilise more representative government datasets, including improved estimates of activity in the informal sector.

India’s nominal GDP for 2025-26 (April 2025 to March 2026 fiscal), which excludes the impact of inflation, is estimated to grow at 8.6 per cent. In the budget for the financial year 2026-27, the government has estimated India’s nominal growth rate for the next year at 10 per cent under the old base year.

For much of the current financial year, the Indian economy had to contend with uncertainty from tariffs, which weighed on exports.

The Modi government responded by overhauling GST, which lowered taxes on hundreds of items, and implementing long-delayed labour reforms.