Last Updated:November 28, 2025, 19:25 IST

India’s GDP grew 8.2 percent in Q2 FY2025-26, driven by strong secondary and tertiary sectors, with experts expecting a possible RBI rate cut.

RBI MPC Meet, India GDP Growth: Experts are now weighing the possibility of a repo rate cut at the Reserve Bank of India’s next Monetary Policy Committee (MPC) meeting scheduled for December 3–5, 2025. The expectation has strengthened after India posted a robust 8.2 per cent GDP growth in the July–September quarter of FY2025-26, far above market estimates.

Real GDP growth for the first half of FY26 stood at 8 per cent, compared with 6.1 per cent in the same period last year. At the same time, headline inflation dropped to 0.25 per cent in October — the lowest in the current CPI series — and remains comfortably within the RBI’s tolerance band.

Upasna Bhardwaj, Chief Economist, Kotak Mahindra Bank says that despite the high real GDP growth, they retain their expectations of 25 bps of rate cut in the upcoming policy as inflation trajectory remains benign.

“The sharply higher than expected 2QFY26 GDP was broad based but comes on the back of a very low deflator. The single digit nominal GDP growth continues to signal tepid underlying activity,” Bhardwaj added.

Aditi Nayar, Chief Economist, ICRA noted that the probability of a rate cut in the December 2025 MPC review has certainly eased, with the Q2 FY2026 GDP growth exceeding 8% and he series-low CPI inflation print for October 2025.

Nayar said that the upside surprise in the Q2 GDP growth print was driven by services, even as the agriculture and industrial sectors largely reported prints along expected lines. “The 9.7% surge in the public administration, defence and other services segment in Q2 FY2026 was quite surprising given that the Government of India’s (GoI’s) non-interest revenue, Nayar added.

The India’s GDP trajectory is also being supported by robust consumption, and a planned decrease in MPC rates along with a softening trend of CPI and WPI inflation, according to Ranjeet Mehta, CEO & Secretary General, PHDCCI.

Rajeev Juneja, President of PHDCCI added that the tertiary sector’s rise was the main driver of this expansion, followed by the secondary sector. For Q2 FY 2026, the manufacturing sector expanded by 9.1% (Y-o-Y), while the tertiary sector had strong growth of 9.2%. Within the tertiary sector, the financial, real estate & professional services grew at 10.2% (Y-o-Y) for the same period. This trend points towards India’s steady and robust development, boosted by structural policy reforms by the government”, said Mr. Juneja.

India’s GDP expansion surpassed all expectations to grow at 8.2 per cent in the July-September Quarter (Q2) of Financial Year (FY) 2025-26, compared to the growth rate of 5.6 per cent during the same quarter of FY2024-25. The Secondary and Tertiary Sectors have played a critical role in boosting the Real GDP in H1 of FY2025-26.

Varun Yadav

Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More

Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More

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