Strong Service Sector Drives 7.8% Growth for India in Early FY27

India's first quarter of fiscal year 2027 recorded a robust 7.8 percent rise in real GVA, underscoring the continued momentum of the post‑pandemic recovery. The surge represents a 0.9 percentage‑point jump from the same quarter last year.

While nominal GDP grew by 10.3 percent, the real side of the economy expanded at 8.2 percent, with nominal GVA accelerating even faster at 11.5 percent.

The services arena was the standout performer, expanding at a 10 percent clip. Finance, real estate, information technology and professional services together delivered a 12.1 percent increase, outpacing other segments. Manufacturing output grew 8.6 percent in constant prices, and agriculture, together with allied activities, rose 3.6 percent.

Capital formation saw a pronounced upswing, with gross fixed capital formation reaching 11.9 percent, more than double the 5.8 percent recorded a year earlier. Private consumption also grew, climbing 7.1 percent in real terms, signalling strong domestic demand.

Earlier this month, RBI Governor Sanjay Malhotra projected a 7 percent GDP growth for the quarter, citing reduced supply‑side strain after June 2026 but warning that the resurgence of conflict in West Asia could again affect energy prices and supply‑chain stability.