India’s GDP Growth: Despite global economic uncertainties, high US tariffs and international market turmoil, the Indian economy is growing at a fast pace. Rating agency India Ratings and Research (Ind-Ra) has said in its latest estimate that India’s GDP may grow at the rate of 7.2% in the second quarter of the financial year 2025-26.

The fastest growth will be seen in the second quarter

The rating agency says India’s real gross domestic product (GDP), measured on the base year of 2011-12, will grow at the fastest pace in the last five quarters. The National Statistical Office (NSO) will release official GDP figures on November 28.

Main basis of growth – Private Consumption

Paras Jasrai, Chief Economist and Managing Director of India Ratings and Research, said that increase in private consumption is the main reason for GDP growth. “There has been improvement in the real income of both high and low income groups, which has increased demand.”

Contribution of infrastructure and service sector

According to the agency, the strong position of the infrastructure sector, increase in goods and services exports and strength of the services sector have also boosted the growth in the second quarter. Private consumption is estimated to grow by 8% in the second quarter of the financial year 2025-26. Whereas in the first quarter of last year it was 7% and in the second quarter it was 6.4%.

The agency says that the income tax cut by the government has played an important role in increasing consumption demand. However, if purchase decisions had not been postponed due to the rationalization of GST rates, there would have been an even sharper jump in consumption.

7.5% increase in investment demand

According to the statement, investment demand has also increased at the rate of 7.5% on an annual basis. Stable capital expenditure of the government is playing an important role in maintaining this growth.

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Afghanistan’s Foreign Minister Aamir Khan Muttaki is currently on a tour of India, which is a topic of discussion at present. This visit clearly shows that relations between India and Afghanistan are good. After America’s departure in the year 2021, Taliban captured Afghanistan, after which they formed their government there. However, India has not yet recognized them. Despite this, both the countries insist on good relations with each other. Meanwhile, if we talk about Afghan currency, it is surprising. Afghanistan is a poor country. Despite this, the currency here is more valuable than the Indian rupee. According to the report of XE.com, the value of 1 Afghani rupee is equal to 1 rupee 33 paise in India, whereas the value of 1 rupee in Afghanistan is only 0.75 paise.

It is shocking that how can the currency become so strong in Afghanistan under Taliban control, where unemployment, illiteracy and poverty are at their peak. Actually, there are many interesting reasons behind this. The Taliban government has banned the use of US dollars and Pakistani rupees. Due to this, the demand for foreign currency within the country has reduced and the price of Afghan rupee remains stable.

Value of Rs 1 lakh in Afghanistan
For example, if an Indian earns 1 lakh rupees in Afghanistan, then after coming to India its value will be 1 lakh 32 thousand rupees, which is 32 thousand more than the 1 lakh earned in India. This gap of 32 thousand is quite big in itself. However, if we talk about Pakistan and Bangladesh, the value of the currency there is much less than that of India. The value of 1 rupee in Pakistan is 3 rupees 17 paise, while the value of 1 rupee in Bangladesh is 1 rupee 37 paise.

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India’s Service Sector Growth Slows: Disappointing news has come from the service sector amidst the continuous efforts being made to speed up the country’s economy. While the recent GST reforms were expected to raise domestic demand and business activities, the growth rate of the service sector has slowed down in September.

According to the Service Survey of India Seva PMI released by HSBC, the business activity index (PMI) of the service sector declined to 60.9 in September 2025, compared to 62.9 in August. Although this level is above the neutral level of 50 points, it shows that the economy still continues to grow, but this growth is now slower than before.

Recession signs and lack of international demand

According to the survey, one of the main reasons for the slowdown of the service sector is the slow pace of new orders and business activities. Along with this, there has been a soft improvement in the international demand of Indian services.

In September, an increase in export orders was recorded, but it has been at the weakest level since March. Companies said that the availability of services at low prices in other countries has increased competition, which put pressure on India’s external sales.

The situation was a bit better on the price level front. The survey reported that inflation speed had been the slowest since March, and it was in line with the long -term average. In September, the prices of Indian services increased at a weak rate, which brought some relief to consumers.

Sleake in employment generation

Employment generation was also slow during September. Less than five percent of the companies involved in the survey reported new recruits. This means that employment growth in the service sector was limited and new job opportunities were reduced.

Composite output index declines

Composite Output Index of HSBC India – which includes both manufacturing and service display – remained at 61.0 in September, which came below 63.2 in August. This reflects the weakest rate of expansion since June. This index is prepared on the basis of share in the GDP (GDP) of the country’s manufacturing and service sectors.

Purchasing manners’ Index) staying above 50 means expanding in the economy, while the level below 50 reflects contraction. Although the growth rate of the service sector has slowed down a bit, it is still in the field of expansion – which indicates that the foundation of the country’s economy remains strong, even though there is pressure on the service sector in the short term.

Opinion of analysts

According to HSBC India Chief Economist Pranjul Bhandari, “The business activities of the service sector have slowed down in September after touching the record height in August. However, this sector may gain speed again in the coming months due to domestic demand and policy stability.”

Overall, this report states that India’s service sector is still flexible and developing, but increasing global competition and reduction in international demand are making challenges for this.

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India Forex Reserve Drops: At a time when there is a high American tariff on India and the H1B visa fees have been increased, despite these adverse circumstances, every possible steps are being taken by the Central Government to speed up the economy. One of those steps is GST Reform and Free Trade Agreement with other countries including Britain. But despite the strength on the economic front, while the Indian currency went on all time low recently compared to the US dollar, on the other side another disappointing news has come out. Hearing this, the neighboring enemy country will be happy with Pakistan as well as China.

Foreign exchange reserves decreased

In fact, the country’s foreign exchange reserves declined by $ 39.6 million to $ 702.57 billion in the week ended September 19. Information was given by the Reserve Bank of India (RBI) on Friday. A week before this, the total foreign exchange reserves of the country increased by $ 4.69 billion to $ 702.97 billion.

According to the Reserve Bank data, foreign exchange assets, considered to be the major component of currency reserves in the week ended September 19, declined by $ 86.4 million to $ 586.15 billion.

Why did there be a shortage?

Forex assets expressed in terms of dollars include the effect of price growth or depreciation in non-American currencies such as euros, pounds and yen. According to the central bank, the country’s gold reserves increased by $ 36 million to $ 92.77 billion in the current week. During this period, special drawing rights (SDR) rose $ 10.5 million to $ 18.87 billion. According to the Reserve Bank data, India’s reserved reserves in the International Monetary Fund increased by $ 296 billion in the week under review.

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GST Reforms: India, which is the fastest growing largest economy in the world, is preparing to face US President Donald Trump’s business war and 50% tariff influence. At such a time, cuts in the rates of Goods and Services Tax (GST) can prove to be an important step.

Finance Minister Nirmala Sitharaman made it clear that the reduction in GST rates was in the plan for several months and has no connection with the American tariff. Experts believe that this step promoting domestic consumption is beneficial for areas that are facing uncertainty in exports.

Economic growth will be strengthened by new GST rates

The Modi government has announced the reorganization of GST reforms and tax structure. With the onset of Navratri from 22 September, the prices of most items of the common man and middle class will be cut. This will bring the ability to spend more in the hands of consumers and the country’s GDP is expected to increase consumption -based increase.

‘The effect of tariff may decrease’

Experts say that 50% of tariffs in the US will affect India’s exports, but India is primarily dependent on domestic consumption. According to Madan Sabnavis, the chief economist of Bank of Baroda, GST improvement will help reduce production costs, which will benefit in global competition. Sachchidanand Shukla, the chief economist Sachchidanand Shukla, a group of Larsen & Toubro, believes that GST rate cuts can have a positive impact of up to Rs 500900 billion on GDP.

Revenue will affect this

According to Revenue Secretary Arvind Srivastava, GST deduction on the basis of 2023 24 will affect the tax collection of Rs 48,000 crore. However, experiences of earlier GST reforms suggest that the revenue flow is strengthened after the initial decline. D.K. of EY India Srivastava said that this improvement in employment intensive areas like textile, consumer electronics, automobiles and foods will give wide benefits.

Earlier this year, the income tax deduction announced by the Finance Minister, the RBI will also promote domestic consumption of 1% in the repo rate and the recommendations of the upcoming 8th Pay Commission. With all these measures, GST reforms will prove to be a major economic incentive for the general public before the celebrations.

India services PMI: India’s service sector has demonstrated a record -breaking demonstration in August and its speed has reached a 15 -year highest level. This bounce was mainly possible due to a rapid increase in new orders and production. The HSBC India Services Purchasing Manager Index (PMI) data released in a private survey conducted by S&P Global.

According to the report, seasonally adjusted HSBC India Seva PMI rose from 60.5 in July to 62.9 in August. This is the fastest speed of expansion since June 2010. The survey states that significant improvement in demand and strengthening of new orders brought out the activities of services to a high level of 15 years.

Strength in demand and order

More than 50 points on the scale of PMI means that business activities are expanding, while less than 50 points indicate contractions. Reaching PMI 62.9 in August shows that the service sector is expanding very fast.

According to HSBC India Chief Economist Pranjul Bhandari, “The growth rate of services is at a 15 -year high and the increase in the new order has strengthened it.” However, he also added that the inflation rate on the price front has reached a 9 -month high, due to which inflation also remains pressure.

Composite PMI jump

Meanwhile, the joint index of both services and manufacturing composite PMI also increased from 61.1 in July to 63.2 in August. This is the fastest growth of 17 years. This means that not only services but also the manufacturing sector in India is performing strong and the two together are taking overall economic activities to a new height.

The index has been prepared by S&P Global on the basis of survey of about 400 service sector companies and is given weightage in the ratio of India’s GDP (GDP).

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Rbi governor sanjay malhotra: Reserve Bank of India (RBI) Governor Sanjay Malhotra said on Saturday that India will soon become the third largest economy in the world. He credited the Pradhan Mantri Jan Dhan Yojana for promoting the development of the country. His statement has come at a time when India’s GDP has moved forward at a rate of 7.8 % in the April-June quarter of the current financial year despite the ongoing tariff tension in the country. This is the highest among the five quarters before America’s heavy tariffs are imposed.

Plan started 11 years ago

Addressing the financial inclusion campaign of a government bank in Rangwasa village of Indore, he said that the Central Government and RBI had launched Jan Dhan Yojana with the help of banks 11 years ago, which has developed the entire country.

He said, “Today India is counted among the 5 most developed countries in the world and very soon the country will become the third largest economy.” The RBI Governor said that 55 crore accounts have been opened under this scheme to ensure the participation of people of all classes in this journey of the country, so that they are being provided saving, pension, insurance, loans and other services. State Bank of India (SBI) Chairman CS Setty was also present on the occasion.

Recently, the Pradhan Mantri Jan Dhan Yojana completed its 11 years. On this occasion, PM Modi said that this scheme has given people the power to write their own luck. He also said that when the last person is financially connected, the whole country moves forward together. This scheme was started on August 28 in 2014.

From Financial Exclusion to Empowerment! Here is a glimpse of how PM Jan Dhan Yojana has transformed lives across India. #11yearsofjandhan https://t.co/z0vxpo0e3r

– Narendra Modi (@narendramodi) August 28, 2025

What is Jan Dhan Yojana?

Please tell that the purpose of this scheme is to open the bank account of the poor and provide them with the benefit of government schemes. There is no need to keep a minimum balance in it. Also, overdraft facility is also available. In this, account hold is also given the facility of insurance and due to some reason, family members get the benefit of nominee. Under this, you have to go to the bank and apply to open an account. From there, the form of Jan Dhan Yojana will have to be filled.

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India’s Index of Industrial Production: This news is going to give relief for the Indian economy facing the American tariff. In July, there has been a 3.5 percent increase in industrial production of the country. This is the highest increase in the last four months. The main reason for this surge was the better performance of the manufacturing sector.

On Thursday, the official data released by the National Statistics Office (NSO) stated that the Industrial Production Index (IIP) increased by 3.5 percent in July. This is the highest level after the 3.9 percent increase recorded in March this year. However, in July 2024, industrial production had increased at the rate of 5 percent, that is, this time the growth on an annual basis has been slightly slow.

Meanwhile, NSO has kept the growth rate of industrial production for June 2025 stable at 1.5 percent. This figure is the same as the temporary estimate released last month.

Why increased speed?

In July 2025, the growth rate of manufacturing sector was 5.4 percent, compared to 4.7 percent in the same month last year. However, the mining sector recorded a huge decline of 7.2 percent. A year ago, it increased by 3.8 percent in the same period. There was also a big decline in power generation. While power generation increased by 7.9 percent in July 2024, it was only 0.6 percent in July 2025.

FY

The country’s total industrial production increased by only 2.3 percent in the first four months (April-July) of FY 2025-26. Whereas in the same period last year, it was 5.4 percent. It is clear that at the beginning of the current financial year, the pace of industrial activities has been relatively slow.

Significantly, this increased news has come at a time when 50 percent US tariffs have been effective on India since August 27, one day ago. However, many efforts are being made by the government to deal with it. But, it is being said that due to this high tariff, business related to labor -oriented employment such as clothes, leather, footwear, gems and jewelery can be affected.

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India Private Sector Economy: The activities of India’s private sector have reached a new record level in August. HSBC Flash India Composite PMI output index reached 65.2 due to the rise in orders. At the same time, PMI of the service sector has been recorded at 65.5, which has reached this level for the first time since the start of this index since December 2005 and has also surpassed manufacturing growth. Composite PMI was 61.1 in July while in August 2024 it was recorded 60.7.

Service sector leads

The growth of the service sector was at the top. India’s HSBC Chief Economist Pranjul Bhandari said that due to new business orders at both domestic and export levels, the PMI of the service sector has reached all time high.

Manufacturing sector also strong

At the same time, the manufacturing sector was also seen to be strong. Manufacturing PMI increased to 59.8 in August, which was 59.1 in July. This is the strongest performance of the manufacturing sector since January 2008. Pranjul Bhandari says that due to the rise in domestic demand, manufacturing PMI is close to touching the level of 60.

Although there has not been a big change in export orders compared to July, the most demand has been seen at the international level since 2014. Orders have increased especially from Asia, West Asia, Europe and America.

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