India’s economy grew 7.8% in the June quarter of FY2026, higher than the 6.7% forecast. Growth was powered by strong performance in manufacturing, construction, and services. However, economists warned of a slowdown as U.S. tariffs and a weak rupee raise concerns.

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• GDP growth 7.8% in April-June, above forecast 6.7%
• Manufacturing up 7.7%, services up 9.3%, construction up 7.6%
• Nominal GDP slowed to 8.8%, down from 10.8% in prior quarter
• Soft deflator made real GDP appear stronger
• Corporate sector earnings in manufacturing remain solid
• U.S. tariffs of 50% on Indian imports began Wednesday
• Rupee fell past 88 per dollar, record low
• RBI cut policy rate to 5.5% in June, may cut again if slowdown persists
• Economists see tariffs pressuring growth in coming quarters
• World Bank projects 6.3% growth, IMF 6.4% for FY2026