‘Key growth engine for world’: IMF praises India’s 7.8% growth, backs changes to GDP estimates

India’s economy has remained on a growth path despite the energy price shock, with real GDP increasing by 7.8% in the April-June quarter. The IMF praised the better-than-expected performance and said the growth was driven by better-than-expected activity in services and exports.At a news conference, IMF spokesperson Julie Kozack said: “India’s real GDP in the second quarter grew 7.8 percent. That was above our staff’s expectations and also the consensus among other observers. This upside surprise was driven by stronger-than-expected activity in the services sector and in exports.”“The result also underlines the resilience of the Indian economy despite the energy price shock. It also means that India remains a key growth engine for the world,” he added.The 7.8% growth in real GDP for the first quarter of FY27, which covers April to June, was higher than the Reserve Bank of India’s earlier estimate of 7%. Data from the Ministry of Statistics and Program Implementation (MoSPI) showed real GDP of Rs 81.36 lakh crore in the quarter, compared to Rs 75.46 lakh crore in the same period of FY26.

IMF supports changes in GDP estimates

In addition to its positive assessment of India’s growth, the IMF also welcomed changes made to the country’s GDP estimation system.Kozack said the latest GDP release included a new industrial production index and a new set of producer price indices. According to her, both should help improve India’s GDP estimates.“I can say that the last GDP release, which we just talked about for the second quarter, incorporated a new industrial production index. It also included a new series of producer price indexes, and those two new series should help improve India’s GDP estimates,” Kozack said.He said the IMF welcomed India’s efforts to modernize its macroeconomic statistics and encouraged the authorities to continue strengthening the statistical framework and data quality.“And we welcome these important steps that India is taking to modernize its macroeconomic statistics. And, of course, we encourage the authorities to continue strengthening the statistical framework and data quality as they are making progress,” he said.

GDP figures face doubts

The IMF’s comments come amid a debate over India’s latest GDP figures and the revisions behind them. Former Finance Secretary Subhash Chandra Garg had questioned the reported 7.8% growth in the April-June quarter, pointing to a revision in the current GDP from the previous year from Rs 86 lakh crore to Rs 80 lakh crore.Garg had said that without the revision, growth at current prices would have been around 2.6%, adding to doubts over India’s GDP estimates.The IMF also said the latest figures showed the resilience of India’s economy. He welcomed the changes to the GDP estimation system and noted that the new industrial production index and producer price index series would help improve GDP estimates.