India’s Economy Surges: Q4 GDP Growth Hits 7.4%, Outperforms Expectations

Quarterly Upswing Signals Robust Economic Momentum

India’s economy delivered a pleasant surprise with its fourth quarter GDP numbers, registering a growth rate of 7.4% for the January–March period of FY 2024–25, surpassing most market forecasts. The National Statistical Office (NSO) had estimated a more modest 6.85%, but stronger domestic demand and industrial activity fueled faster expansion.

This quarterly performance also marks an improvement over the 6.2% growth seen in Q3, reflecting broad-based resilience across key sectors of the economy.

Annual GDP Growth Slows, Still Steady at 6.5%

Despite the Q4 acceleration, India’s full-year GDP growth for FY 2024–25 stood at 6.5%, the slowest in the last four years. However, analysts note that this moderation comes off a high base. It occurs amid global economic headwinds. This still represents healthy momentum for a major emerging economy.

Nominal GDP Soars Amid Strong Output

Nominal GDP, which includes the impact of inflation, rose 9.8% year-on-year to reach ₹330.68 lakh crore in FY25. In Q4 alone, nominal GDP saw a robust 10.8% jump to ₹88.18 lakh crore, suggesting a solid expansion in real output and price gains.

Key Sectors Drive Growth

The manufacturing sector led the growth story with a 9.4% annual expansion, surging to 10.8% in the fourth quarter alone. Other significant contributors included:

• Public administration, defence and other services: +8.9%
• Financial, real estate, and business services: +7.2%

Private consumption also rose 7.2% over the year, reinforcing the strength of domestic demand. Investments remained strong, with gross fixed capital formation up 7.1% year-on-year, and 9.4% in Q4.

Primary Sector and GVA Register Gains

The primary sector (including agriculture and mining) grew by 4.4%, with a significant Q4 jump to 5%, up from just 0.8% in the same period last year.

Real Gross Value Added (GVA)—a measure of value creation in the economy—stood at ₹171.87 lakh crore, up 6.4% year-on-year. Nominal GVA increased 9.5% to ₹300.22 lakh crore.

These figures were calculated using a broad range of indicators. These include the Index of Industrial Production (IIP), corporate financial results, agricultural output data, and tax collections. Officials indicated that future revisions may occur as data coverage improves.

RBI and IMF Outlook

The Reserve Bank of India had projected 7.2% growth for Q4 and 6.6% for the full year, figures that align closely with the actual outcome. Meanwhile, the IMF forecasts India will become the fourth-largest economy globally by 2025–26, overtaking Japan.

Looking Ahead

The next GDP release, covering the April–June quarter of FY 2025–26, is scheduled for August 29. As India targets continued growth, the latest data underscores its resilience. It shows India’s growing influence as a major economic power.

For all latest updates Follow theviralmail on X, Facebook, and Instagram