India’s economy grew 8.2% in the September quarter despite the tariff bite

India’s economy grew at a faster-than-expected 8.2% annual rate in the quarter ended September, in a quarter partly affected by 50% US tariffs.

There was an acceleration of growth from 7.8% in the previous quarterWhen a low deflator unexpectedly boosts real growth. A deflator measures how inflation affects the value of aggregate output.

A Reuters poll of economists had pegged July-September gross domestic product at 7.3%.

India’s nominal GDP – which excludes inflation or deflation – grew 8.7% in the September quarter compared to 8.8% In the previous quarter.

Growth in manufacturing and construction activities and domestic consumption led to a sharp improvement in the GDP growth rate. Financial and real estate professional services maintained a “substantial growth rate” of 10.2% in July-September, the government said. A publication.

In the September quarter, there was a “hold back” ahead of domestic consumption Planned reduction in goods and services taxAxis Bank Chief Economist Neelkanth Mishra told CNBC’s “Inside India” ahead of the GDP data release.

A 50 percent tariff on Indian goods exported to the US came into effect in August. To minimize the impact, New Delhi announced a cleanup GST tax deduction Effective September 22 to promote domestic consumption.

Demand picked up sharply in October with record sales of Auto And Gold The GST cut and the earlier cut in the personal income tax rate boosted disposable income. However, India’s goods trade deficit A new high was reached On weak exports and high gold imports.

International Monetary Fund, In a report India’s real GDP is projected to grow 6.6% in fiscal 2026, and it will pick up to 6.2% in fiscal 2027, assuming a longer delay in the US-India trade deal, it said on Wednesday.

Also, India’s merchandise exports are expected to decline by 5.8% to $416 billion in FY 2026, while merchandise imports are expected to increase by 2.4% to $746 billion.

“Despite external headwinds, growth is expected to remain robust due to favorable domestic conditions,” the IMF said in a release, adding that its data also suggested that India would become a $5 trillion economy by fiscal 2029.

— CNBC’s Amitoj Singh contributed to this report.