New Delhi, Nov 28 With the increase in credit during Q3 FY26 amid GST rationalisation, India’s GDP growth will be 7.5-7.7 per cent in Q3 and 7.0-7.1 per cent in Q4 FY26, SBI Research said on Friday.
With 7.6 per cent real GDP growth for FY26, the GDP is likely to cross $4 trillion by March 2026 and for FY27, GDP is expected to be around $4.4 trillion, the report added.
“Thus, India is on the right track to reach $5 trillion by March 2029. With a strong GDP growth and a minimal inflation, it is now for the RBI to communicate to the broader markets the rate trajectory in next week MPC as also continuing with the neutral stance,” said the SBI report.
The India story appears to take new, bigger and bolder dimensions. All with alluring connotations.
The growth juggernaut, represented in a 6-quarter high of 8.2 per cent for Q2 FY26, vindicates this. Nominal GDP grew by 8.7 per cent in Q2 FY26 — higher than 8.3 per cent growth that took place in Q2 FY25,” according to the report.
The overall trends suggests that GDP growth is domestic driven, supported by services exports and driven by low inflation and value-add expansion in labour intensive sectors.
“We believe for FY26, the MSME credit growth should come around Rs 6.4 lakh crore as second half is more credit productive for the banking system. Thus the annual growth in FY 26 could be 5.5 times of previous 16 years average figure of Rs 1.17 lakh crore. Going by the resounding growth in MSMEs, the GDP growth seems to be finally entwined for the masses,” the report highlighted.
The gap between real and nominal GDP, which was as large as 12 percentage points in Q1 FY23 is now at 0.5 percentage points in Q2 FY26.
“Core GVA (Overall GVA ex Agriculture and Public Finance) registered a growth of 8.5 per cent YoY in Q2 FY26 compared to a lower 5.6 per cent YoY in Q2 FY25,” said the report.
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