7.4% GDP Growth Forecast: Which Sectors Will Drive India’s Economy? | Drishti IAS | Current Affairs

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The Government of India has projected GDP growth of 7.4% for 2025-26 in its First Advance Estimates, pointing to continued economic momentum but with signs of moderation in the second half of the year. Based on strong growth of 7.8% in Q1 and 8.2% in Q2, the estimate implies that growth in Q3 and Q4 may average around 6.8%.
The projections broadly align with the forecast of the Reserve Bank of India, which had earlier estimated GDP growth at 7.3%, with a gradual slowdown towards the end of the fiscal year. Sector-wise data shows manufacturing growth accelerating to 7%, while agriculture growth is expected to slow to 3.1%. The mining sector is projected to contract slightly, while the services sector is expected to remain the key growth engine with 9.1% growth.
On the demand side, Private Final Consumption Expenditure is projected to grow at 7%, while Gross Fixed Capital Formation is expected to rise by 7.8%, indicating steady investment activity. This video explains what the advance estimates mean, how sectoral trends are shaping India’s growth outlook, and why economists are calling for cautious optimism. Highly relevant for UPSC GS-III, Indian Economy, and current affairs.
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