India's GDP growth quickens to 7.8% in Q1, driven by manufacturing and services
India's economic growth rate accelerated to a five-quarter high of 7.8% in the April-June quarter (Q1) of the current financial year, surpassing the Reserve Bank of India's prediction of 6.5%. This robust growth was primarily propelled by strong performances in the manufacturing, construction, and services sectors. Chief Economic Adviser V. Anantha Nageswaran expressed confidence in continued momentum despite concerns over U.S. tariffs, attributing the resilience to government decisions on indirect tax rates. However, the Rupee depreciated to an all-time low against the USD, influenced by additional U.S. tariffs.
Key Points
- India's GDP grew by 7.8% in the first quarter (April-June) of the current financial year, marking a five-quarter high.
- The growth exceeded the Reserve Bank of India's projection of 6.5% for the same period.
- Key drivers of this economic expansion include strong performances in the manufacturing, construction, and services sectors.
- Despite concerns over U.S. tariffs, the Chief Economic Adviser anticipates continued economic momentum.
- The Rupee experienced a significant depreciation, reaching an all-time low of 88.09 against the U.S. dollar, partly due to new U.S. tariffs.
Exam Facts
- India's GDP growth for April-June 2025 (Q1) was 7.8%.
- The Reserve Bank of India (RBI) had predicted a Q1 growth of 6.5%.
- The public administration, defence, and other services sector grew at a three-year high of 9.8%.
- The Rupee fell to ₹88.09 against the U.S. dollar, an all-time low.
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