According to a report by the country’s largest lender State Bank of India (SBI), India’s economy is expected to remain bullish, and GDP is expected to grow by about 8.1 percent in the third quarter of the current financial year (FY26). The report states that despite global headwinds, the Indian economy remains strong, supported by domestic demand and stable economic activity across all sectors. It says that we expect real GDP growth to be around 8.1 percent in Q3FY26. Let us also tell you what kind of report SBI has presented regarding the country’s economy.
Why can GDP remain strong?
According to the report, high-frequency economic indicators are pointing to strong economic activity during the third quarter of FY26. Rural consumption remains strong, supported by positive signals from both farm and non-farm activities. Additionally, there has been a steady improvement in urban consumption, supported by the financial stimulus and increased spending from the last festive season. According to the first advance estimates, India’s GDP is expected to grow at the rate of 7.4 percent in the financial year 2026, in which the growth will depend mostly on domestic demand. The report emphasized that despite uncertainties in the global economic environment, domestic consumption is playing an important role in supporting economic growth.
Data will come on 27th February
The report also states that the second advance estimate of GDP for FY26 is going to be released on February 27, 2026. These estimates will include additional data and variations, and are expected to be subject to changes from prior quarterly GDP figures for Q1 and Q2 due to changes in the base year. India has updated its GDP base year from 2011-12 to 2022-23, and the new series is scheduled to be released on February 27, 2026. The report said that, given the major method changes, it is difficult to predict the direction of changes in GDP data. The purpose of the change in base year is to better reflect the current structure of the Indian economy, which includes changes like digital commerce and the increasing role of the service sector.
There was also a change in the mathematics of inflation
Apart from this, India has also updated the base year for the Consumer Price Index (CPI) to 2024, which will help in making a more accurate estimate of inflation based on the current consumption pattern. Recently, Reserve Bank of India (RBI) Governor Sanjay Malhotra also said that the change in inflation targeting range after the CPI base year update is being examined and will be considered in the next policy. He said that the changed framework will be kept in mind in the next projection of RBI during the April monetary policy. The report emphasizes that strong domestic demand, robust consumption trends and ongoing economic activity will continue to support India’s growth outlook, even as global economic challenges remain.