Testing times: On India's GDP growth data

📌 Summary:

• Provisional GDP growth for 2025-26 pegged at 7.7%, marginally above the government's February estimate of 7.6%; Q4 growth at 7.8%
• Resilience shown despite the West Asia crisis erupting in March; manufacturing and several services sectors grew in double digits over an already high base
• Both Private Final Consumption Expenditure (PFCE) and Gross Fixed Capital Formation (GFCF) grew faster than in 2024-25; consumption recovered from a tepid 5.8% of the previous two years
• Worry sign — agriculture: growth slowed to 3% (from 4.2% in 2024-25) despite the 2025 monsoon ending at 108% of LPA; alarming because IMD forecasts the 2026 monsoon at only 90% of LPA, plus looming fertilizer supply constraints
• Structural shift: services' share of GVA rose to 54.3% (from 51.9% in 2022-23); agriculture's share fell below 20% (from 22.1%) though it still employs the largest workforce; manufacturing share largely unchanged → value-added manufacturing not growing fast enough
• Outlook: RBI, government and independent economists agree 2026-27 growth will slow significantly — RBI projects 6.6%, the CEA sees no need to second-guess it
• Last year tested export resilience (tariffs); this year's energy supply disruption from the Iran war will test the whole economy and the government's policy agility

🎯 UPSC Relevance: GS3 Indian Economy — growth drivers, sectoral composition, manufacturing weakness, and agriculture's vulnerability to monsoon and input shocks.

📝 Prelims Facts:

• GDP growth 2025-26 (provisional): 7.7%; Q4: 7.8%; RBI 2026-27 projection: 6.6%
• GVA shares 2025-26: services 54.3%, agriculture below 20%
• PFCE and GFCF are expenditure-side components of GDP

🔑 Key Term: Gross Value Added (GVA) — value of output contributed by each sector; GDP = GVA + net product taxes.