Indian Economy Records 8.2% GDP Growth in Q2 FY26, Exceeding Expectations
India's Gross Domestic Product (GDP) grew by an impressive 8.2% in the July-September quarter of the current financial year (Q2 FY26), marking its fastest expansion in six quarters. This figure significantly surpassed economists' forecasts, which had generally predicted around 7.3-7.4% growth.
The robust growth was primarily driven by strong performances in the manufacturing and services sectors. Manufacturing output increased by 9.1% year-on-year, while the services sector expanded by over 9%, with "Financial, Real Estate & Professional Services" growing by 10.2%. Private consumption, accounting for approximately 57% of the GDP, also saw a significant rise of 7.9% year-on-year.
Prime Minister Narendra Modi described the 8.2% GDP growth as "very encouraging," attributing it to his government's "pro-growth policies and reforms" and the hard work of the Indian people. Finance Minister Nirmala Sitharaman also highlighted the numbers as a testament to the Indian economy's robust momentum, driven by sustained fiscal consolidation, targeted public investment, and reforms.
Economists have subsequently revised their full-year growth forecasts upwards, with several now expecting India's GDP to exceed 7% for the entire fiscal year. This strong performance occurred despite the imposition of additional punitive US tariffs on Indian exports, which have reached up to 50% in response to India's Russian oil purchases.
Moody's Projects India to Lead Emerging Market Growth
In a positive assessment, Moody's Ratings stated that India is expected to maintain its position as the fastest-growing major economy, not only among emerging markets but also across the broader Asia-Pacific region. Moody's estimates India's GDP to expand by 7% in 2025 and 6.4% in 2026, significantly outpacing its peers. The ratings agency highlighted India's strong domestic growth drivers as key to its economic resilience amidst global uncertainties.
Fiscal Deficit and Inflation Updates
The Ministry of Finance reported that India's fiscal deficit stood at ā¹8.25 lakh crore until October of the current fiscal year. This represents 51.5% of the budget estimates for total receipts and 51.8% of total budget estimates for expenditure.
On the inflation front, retail inflation slumped to a record low of 0.25% in October. This subdued inflation environment has raised expectations for a potential interest rate cut by the Reserve Bank of India (RBI) in its upcoming December review meeting.
Tesla Expands Presence in India
In a significant development for the electric vehicle (EV) market in India, Tesla has inaugurated its largest all-in-one center in Gurugram. This facility will offer EV sales, servicing, charging, and will also showcase the Optimus Gen2 robot, marking a stronger push by Tesla into the Indian market and aiming to boost local EV adoption and employment.
Stock Market Performance
On November 28, 2025, Indian benchmark indices, Sensex and Nifty50, ended largely flat amidst mixed global cues. The BSE Sensex closed down by 13.71 points (0.02%) at 85,706.67, while the NSE Nifty50 settled down by 12.6 points (0.05%) at 26,202.95. Sectoral performance was varied, with Nifty IT, Realty, and Oil & Gas sectors experiencing slight declines, while Nifty Auto and Nifty Pharma recorded gains.
Meanwhile, gold prices continued to show a bullish bias, trading steady near ā¹1,25,540, with technical indicators suggesting a "buy-on-dips" strategy for investors.