Real GVA at ₹294.40 lakh crore in the year 2025-26, against ₹273.36 lakh crore in FY 2024-25, registers a growth rate of 7.7% as compared to 7.3% in 2024-25, he added.

As India moves towards deeper integration in the global value chains, base year updates at regular intervals, current after every five years, reflects government’s commitment to data-driven policy intervention to shocks in the global economy, he said.

The revised GDP framework will enhance the credibility and analytical usefulness of India’s national accounts statistics. The updated methodology is expected to provide policymakers, businesses, and investors with a more accurate picture of economic activity across sectors, he added.

New series integrates multiple data sources such as GST statistics, financial results of listed companies, transport indicators, and digital administrative sources. This broader data coverage is expected to strengthen measurement of economic output, consumption, investment, and sectoral contributions, and prepare India for the next phase of growth trajectory, he said.

Given the revised statistical framework and the evolving economic landscape, PHDCCI suggests the following policy priorities to sustain high growth momentum in the coming years:

1. Accelerate implementation of industrial policies and PLI incentive initiatives to deepen domestic manufacturing capabilities, particularly in high-value and growth sectors such as electronics, engineering goods, chemicals, and renewable energy equipment.
2. Facilitate faster project clearances, enhance access to long-term finance, and further improve ease of doing business.
3. Further, expanding infrastructure investments in transport, energy, and logistics networks to reduce logistics costs and improve supply chain efficiency.
4. Expand credit access, technology adoption programs, and export facilitation measures to enable MSMEs to integrate into global value chains.

Improved statistical measurement will support data-driven and evidence-based policymaking and facilitate better economic planning. Foreign investors, both institutional and non-institutional, that are keen to invest in India’s growth story, will see this as reliable and internationally comparable data, which augurs well for increasing India’s private capex-driven growth momentum said Dr. Ranjeet Mehta, CEO & SG, PHDCCI.

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Report highlights:

Axis Bank projects above-trend, above-consensus growth of 7.5% in the world’s fastest-growing large economy.

The authors’ thesis rests on several drivers:

1.       Receding fiscal drag and supportive monetary policy to drive above-trend growth of 7.5%. Structural reforms and regulatory easing to boost growth in the medium term.

2.       Improved financials, low cost of capital, high-capacity utilization (need for new capex) to lift capital expenditure in FY27.

3.       Sustained TFP gains and a rebound in capital formation support a 7% trend growth outlook.

Headline inflation of ~4% likely in FY27, but economic slack to persist

§  Median inflation, a better gauge of underlying price pressures, has been stable at ~3% for 18 months signalling persistent slack in the economy.

§  Axis Bank expects FY27 headline inflation of ~4% despite above-trend growth and a likely rebound in food prices.

§  Policy rates have likely bottomed, but money supply can rise further to aid monetary transmission and credit growth; supply-side measures (more T-bills, shorter-duration bonds) can reduce the yield curve steepness.

§  Axis Bank expects 10Y yields to drift close to 6% in FY27.

India’s external balance is stable, USD-INR weakness helps

§  The INR’s recent weakness has brought the REER to competitive levels.

§  Axis Bank expects the current account deficit to widen a notch, to 1.2% of GDP in FY26 and 1.3% in FY27, while the surge in capital outflows seen in 2Q/3Q of FY26 will likely abate.

Economic Outlook 2026: ‘Look! Growth above trend but low inflation’.

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