What Drives India's Robust GDP Growth? Insights from Sanjeev Sanyal
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Synopsis
India's GDP growth in Q2 FY26 has surged impressively, primarily driven by supply-side reforms and macroeconomic stability. Sanjeev Sanyal of the Economic Advisory Council emphasizes the importance of ongoing reforms. Discover how these changes are shaping India's economic landscape and what lies ahead for the nation.
Key Takeaways
- India's GDP growth in Q2 FY26 reached 8.2%.
- Continuous supply-side reforms are crucial for economic performance.
- Macroeconomic stability has been a key factor in sustaining growth.
- All sectors contributed to the GDP increase.
- US tariffs have a limited impact on India's economy.
New Delhi, Nov 29 (NationPress) With India's GDP exhibiting extraordinary growth in Q2 FY26, Sanjeev Sanyal, a member of the Economic Advisory Council (EAC) to the Prime Minister, stated on Saturday that the primary catalyst behind this impressive economic performance is the ongoing supply-side reforms, alongside a stable macroeconomic environment.
The real GDP of India, adjusted for inflation, is projected to increase by 8.2 percent in Q2 of FY 2025-26, compared to a growth rate of 5.6 percent during Q2 of FY 2024-25.
In an interview with IANS, Sanyal remarked that "the main catalyst for this strong growth performance is the adept management of the supply side, specifically, the ongoing supply-side reforms coupled with macroeconomic stability."
"Given the success of this strategy, we should persist in pursuing next-generation reforms. Recently, we have enacted additional reforms, including the simplification of GST slabs," he added.
This rationalization of tax slabs signifies a significant transformation in simplifying the system and alleviating unnecessary complexities.
Sanyal further commented that the 8.2 percent growth recorded in the second quarter is indeed impressive, "even slightly surpassing my expectations, and builds upon the 7.8 percent growth of the preceding quarter (Q1 FY26)."
"This showcases genuinely robust GDP growth. Notably, this growth has been accomplished without causing the economy to overheat," Sanyal informed IANS.
Every sector within the economy is playing a crucial role in the nation’s growth. The primary sector saw a year-on-year Real GVA growth rate of 3.1 percent in Q2 FY 2025-26. Likewise, the Secondary (8.1 percent) and Tertiary Sectors (9.2 percent) have significantly contributed to the Real GDP growth rate in Q2 of FY 2025-26.
Regarding US tariffs, the seasoned economist mentioned that the impact on India remains limited.
"There is some effect, but it hasn’t been substantial because over the past decade, we have been implementing reforms, and we continue to manage challenges proactively. Whenever an obstacle arises, we find a solution. This adaptable policy-making approach has allowed us to progress. New challenges will always surface, but we address each challenge flexibly and introduce further reforms at every step," emphasized Sanyal.
Point of View
It is crucial to recognize the significance of Sanjeev Sanyal's insights on India's economic growth. His emphasis on supply-side reforms and stability reflects a forward-thinking approach that aligns with the nation's growth trajectory. This perspective not only informs readers but also reinforces the importance of ongoing reforms in sustaining economic momentum.
NationPress
29/11/2025
Frequently Asked Questions
What is the GDP growth rate for Q2 FY26?
The GDP growth rate for Q2 FY26 is estimated at 8.2%, significantly higher than the 5.6% growth rate recorded in Q2 FY25.
What factors contributed to India's GDP growth?
The robust GDP growth is primarily attributed to continuous supply-side reforms and macroeconomic stability.
How do supply-side reforms impact the economy?
Supply-side reforms enhance economic efficiency, stimulate investment, and promote sustainable growth, thereby contributing positively to GDP.
What sectors contributed to the GDP growth?
The primary sector grew by 3.1%, while the secondary and tertiary sectors grew by 8.1% and 9.2%, respectively, in Q2 FY26.
How has the US tariff situation affected India?
The impact of US tariffs on India has been limited, as India continues to proactively manage challenges amid ongoing reforms.
