DBS Research projects India’s real GDP growth will moderate in Q1 and Q2 2026 due to weaker industrial activity and trade.
India’s real GDP growth is expected to ease to 6.9% year-on-year in the first half of 2026, down from 7.8% in the October-December 2025 quarter. The slowdown is attributed to softer industrial activity, trade, and government spending, according to a nowcast model.
Growth had firmed in the second half of FY26, supported by tax rationalization, festive demand, and investment activity. The October-December 2025 quarter saw 7.8% expansion, following 8.4% in the previous quarter.
The nowcast model forecasts 7.2% growth in Q1 2026 and 6.9% in Q2, signaling a gradual deceleration. Full-year 2026 growth is projected to ease from 2025 levels.