India’s Q4FY25 GDP surges to 7.4% as construction and services lead, economic growth hits 4-year low

Nominal GDP surged by 9.8% over the previous year, reaching ₹330.68 lakh crore, while real GDP at constant prices touched ₹187.97 lakh crore. The fourth quarter alone saw nominal GDP jump 10.8% to ₹88.18 lakh crore.

India’s economy clocked a 6.5% growth in real GDP for FY 2024-25, according to provisional estimates released by the Ministry of Statistics and Programme Implementation (MoSPI). The January-March quarter (Q4) outpaced annual performance with a robust 7.4% rise, signaling continued recovery momentum.

While India’s GDP growth accelerated to 7.4% in the last quarter of 2024-25, the overall fiscal year number of 6.5% was a 4-year low. In 2023-24, India’s GDP grew by an impressive 9.2 per cent, continuing to be the fastest-growing major economy. According to official data, the economy grew 8.7 per cent and 7.2 percent, respectively, in 2021-22 and 2022-23.

Nominal GDP surged by 9.8% over the previous year, reaching ₹330.68 lakh crore, while real GDP at constant prices touched ₹187.97 lakh crore. The fourth quarter alone saw nominal GDP jump 10.8% to ₹88.18 lakh crore.

The data, issued by the National Statistics Office, highlights key drivers behind this expansion. The construction sector led with a 9.4% annual growth, followed by public administration, defence & other services at 8.9%, and financial, real estate & professional services at 7.2%. For Q4, construction accelerated further to 10.8%.

Private Final Consumption Expenditure, a barometer of domestic demand, grew by 7.2% for the year. Gross Fixed Capital Formation also reflected resilience, expanding by 7.1% annually and 9.4% in Q4.

The primary sector, encompassing agriculture, forestry, and mining, posted a 4.4% growth compared to 2.7% a year ago. Q4 saw a sharp uptick to 5%, from a mere 0.8% in the same quarter last year.

Real Gross Value Added (GVA) stood at ₹171.87 lakh crore, showing a 6.4% growth year-on-year. Nominal GVA reached ₹300.22 lakh crore, marking a 9.5% increase.

The estimates were compiled using a range of indicators, including the Index of Industrial Production, financial performance of listed companies, crop and livestock data, and tax collections. Officials noted that improved data coverage and input revisions may lead to future adjustments.

The Reserve Bank of India (RBI), in its last monetary policy meeting, projected GDP growth for the full financial year (FY25) at 6.6 percent. For the March quarter (Q4FY25), the central bank forecast growth at 7.2 percent.

The GDP data comes at a time when the Narendra Modi government has been talking about India becoming the 4th largest economy this year. According to IMF estimates, India will overtake Japan by the end of 2025-26 to claim the tag of the 4th largest economy after the US, China and Germany.

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