Current Affairs - Economy - Discussion

ICRA has projected that India’s GDP growth for Q2 FY26 will moderate to 7%, reflecting a slowdown from the stronger 7.8% expansion recorded in Q1. This deceleration is linked to weaker performances in the services and agriculture sectors, despite encouraging industrial output supported by festive demand, GST rate cuts, and inventory stocking. Additional factors contributing to the easing pace include lower government expenditure, moderation in services exports, and weather-related disruptions affecting agricultural yields. Although industry remained a bright spot, the combined drag from services, agriculture, and fiscal trends indicates a softer overall growth outlook for the quarter.