India’s GDP grows at 7.8% in Q1FY26, fiscal deficit widens in April-July

India’s economy grew at 7.8 per cent in Q1FY26 over the growth rate of 6.5 per cent during Q1 of FY 2024-25. This has been the fastest pace in five quarters.

As per the data released by the Ministry of Statistics & Programme Implementation (MoSPI), the real GDP has been estimated to grow by 7.8 per cent in Q1 of FY 2025-26 over the growth rate of 6.5 per cent during Q1 of FY 2024-25 while the Nominal GDP has witnessed a growth rate of 8.8 per cent in Q1 of FY 2025-26.

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The Real GDP in Q1 of FY 2025-26 is estimated at Rs 47.89 lakh crore, against Rs 44.42 lakh crore in Q1 of FY 2024-25. Nominal GDP or GDP at Current Prices in Q1 of FY 2025-26 is estimated at Rs 86.05 lakh crore, against Rs 79.08 lakh crore in Q1 of FY 2024-25.

Real GVA in Q1 of FY 2025-26 is estimated at Rs 44.64 lakh crore, against Rs 41.47 lakh crore in Q1 of FY 2024-25. Nominal GVA in Q1 of FY 2025-26 is estimated at Rs 78.25 lakh crore, against Rs 71.95 lakh crore in Q1 of FY 2024-25.

Further, the MoSPI data said the agriculture and allied sector has observed the Real GVA growth rate of 3.7 per cent, as compared to the growth rate of 1.5 per cent registered in Q1 of the last financial year.

The manufacturing sector recorded a growth of 7.7 per cent, and construction at 7.6 per cent.

The Ministry of Finance has also released the data of monthly accounts up to the month of July.

The government’s fiscal deficit target is 4.4 per cent of the gross domestic product (GDP) for FY26, as announced by Finance Minister Nirmala Sitharaman in the Union Budget, against 4.8 per cent in FY25, which was lower than the budget estimate of 4.9 per cent.

As per the Finance Ministry data, the Central Government received Rs 10,95,209 crore, which is 31.3 per cent of the corresponding BE 2025-26 of Total Receipts, up to July 2025, comprising Rs 6,61,812 crore of Tax Revenue (Net to Centre), Rs 4,03,608 crore of Non-Tax Revenue, and Rs 29,789 crore of Non-Debt Capital Receipts.

It said Rs 4,28,544 crore has been transferred to state governments as Devolution of Share of Taxes by the Government of India this period, which is Rs 61,914 crore higher than the previous year.

In terms of expenditure, the Total Expenditure incurred by the Government of India is Rs 15,63,625 crore, which is 30.9 per cent of the corresponding BE 2025-26, out of which Rs 12,16,699 crore is on the Revenue Account and Rs 3,46,926 crore is on the Capital Account.

Out of the Total Revenue Expenditure, Rs 4,46,690 crore is on account of Interest Payments, and Rs 1,13,592 crore is on account of Major Subsidies.