Key facts
- India's economy grew 7.8% year-on-year in the January-March quarter.
- Manufacturing output increased 7.3% in the quarter.
- Construction activity rose 8.4% and farm output grew 3.6%.
- Private investment grew 10.8% in the quarter.
- Full fiscal year growth is estimated at 7.7%.
India's economy expanded by an unexpectedly strong 7.8% year-on-year in the January-March quarter, according to government data released by the National Statistics Office. This growth rate surpassed the 7.2% forecast by a Reuters poll of economists. Gross value added grew 7.9% in the quarter. Manufacturing output rose 7.3%, while construction activity increased by 8.4%, and farm output grew 3.6%. Private consumer spending grew 7.1%, government spending rose 4.9%, and private investment increased by 10.8%. The government estimates full fiscal year growth ending March at 7.7%, an upward revision from the previous 7.6% forecast. Compared to the previous quarter, the January-March period saw a marginal slowdown, with the government revising up the prior quarter's growth to 8.0% from 7.8%. The Middle East conflict and a disappointing monsoon are noted as potential headwinds for future growth, with the central bank seeing the conflict pulling down growth to 6.6% this fiscal year.