India's Q3 GDP grows 7.8% under new series, beats estimates

India's Ministry of Statistics and Program Implementation (MoSPI) released a landmark update to the national accounts on February 27, 2026, introducing a new GDP series with the base year shifted from 2011-12 to 2022-23. This revision incorporates contemporary economic realities, including the digital economy, quick commerce, gig economy, and evolving consumption patterns over the past decade, providing a more accurate and comprehensive picture of the economy.

In the Second Advance Estimates for FY 2025-26 (April 2025–March 2026) under the new series, real GDP (at constant prices) is projected to grow by 7.6%, an upward revision from the First Advance Estimate of 7.4% under the old base year. Real GDP is estimated to reach ₹322.58 lakh crore in FY26, compared to ₹299.89 lakh crore in FY25 (revised under the new series), reflecting robust momentum. Nominal GDP growth stands at 8.6%, also revised higher from the earlier 8.1% projection.

Quarterly performance remains strong and consistent. Q3 FY26 (October–December 2025) real GDP growth came in at 7.8%, aligning closely with Q2's revised 8.4% (up from the previous 8.2%) and Q1's 7.8%. This stability underscores sustained economic resilience despite global headwinds. Sectoral highlights point to manufacturing as a key driver, contributing significantly to growth over the past three consecutive financial years under the rebased series. Manufacturing, which accounts for around 16–17% of GDP, continues to benefit from reforms in recent budgets, supporting the government's long-term target of raising its share to 25%.

The secondary sector (including manufacturing and construction) and tertiary sector (services, financial services, etc.) show upward revisions, with services growing at around 9% in FY26 estimates. The base year change to 2022-23—a post-COVID "normal" year with robust data availability—was recommended by the Advisory Committee on National Accounts Statistics to better capture structural shifts. It employs updated methodologies, such as enhanced use of GST data, double deflation for more precise real value added, and inclusion of emerging sectors previously underrepresented.

This rebasing addresses past concerns from rating agencies and institutions like the IMF regarding methodology and data gaps, while ensuring periodic reviews every five years as per standard practice. The updated figures are expected to influence budgetary planning, fiscal estimates, debt-to-GDP ratios, and policy direction moving forward. Analysts view the release as a major milestone, affirming India's position as one of the fastest-growing major economies and potentially signaling an elevation in global rankings. The new series provides a clearer lens on the economy's strength, driven by domestic demand, manufacturing push, and services expansion, setting a positive tone for future assessments.