New Delhi: India’s economy has shown far greater strength than anticipated in the first quarter of 2025-26, achieving an annual growth rate of 7.8%. According to data released by the National Statistical Office (NSO), the gross domestic product (GDP) in the April to June period saw this surge, which is significantly better than the 6.5% growth in the same quarter last year. This performance arrives at a time when the global economy is grappling with US tariffs, trade wars, and inflation challenges. Experts note that the manufacturing sector’s 7.7% growth and agriculture’s 3.7% rise played key roles in this success, though the services sector’s pace was slightly slower.
On the global stage, India’s growth far outstrips that of major economies. China recorded a 5.2% YoY growth in the second quarter, which is solid for its export-driven economy but faces uncertainties from US restrictions. The United States, the world’s largest economy, achieved a 2.0% YoY growth, relying mainly on consumer spending and investment, with its quarterly annualized rate at 3.3%. Japan showed 1.2% YoY growth, maintaining stability but affected by currency fluctuations and low exports. The UK’s economy also grew by 1.2% YoY, supported by its services sector despite post-Brexit challenges. Meanwhile, Germany, Europe’s largest economy, posted a modest 0.2% YoY growth, linked to industrial slowdowns and energy crises.
This comparison underscores India’s lead not only among emerging economies but also over developed nations. According to projections from the International Monetary Fund (IMF) and World Bank, India’s average growth for 2025 could be around 6.4%, well above the global average of 2.8%. However, challenges persist. Potential increases in US tariffs following the presidential election could affect India’s exports, similar to impacts seen in China. Additionally, inflation, climate change, and global supply chain disruptions pose shared risks for all nations.
The following table compares the YoY GDP growth rates for Q2 2025 (or equivalent fiscal quarter) across key countries:
| Country | YoY GDP Growth Rate (%) | Key Factors |
|---|---|---|
| India | 7.8 | Manufacturing and agriculture boost |
| China | 5.2 | Exports and industrial production |
| United States | 2.0 | Consumer spending and investment |
| Japan | 1.2 | Stable but currency volatility |
| United Kingdom | 1.2 | Services sector support |
| Germany | 0.2 | Industrial slowdown and energy issues |
This data illustrates India’s economy as a shining star amid global slowdowns, but sustained progress will depend on policy reforms and international cooperation. If global trade normalizes, India could reach a $4 trillion economy by the end of 2025.
