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India's Q2 GDP Forecast at 7.2% YoY, Slightly Down from 7.4% in Q1

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  Published in Business and Finance on Thursday, November 27th 2025 at 22:55 GMT by Zee Business

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India’s Economy Gears Up for a Strong Q2 – A 7.2 % Growth Forecast in a Zee Business Poll

A recent poll conducted by Zee Business has projected that the Indian economy will grow at a 7.2 % year‑on‑year (YoY) rate in the second quarter of the fiscal year 2024–25. The forecast comes ahead of the official data release on 29 June 2024, and it reflects a slight dip from the 7.4 % YoY growth recorded in the first quarter. While the headline figure may appear modest, the poll underscores a resilient performance across key sectors, bolstered by strong domestic consumption, robust manufacturing output, and a rebound in the services sector.

1. The Poll – Methodology and Key Figures

Zee Business surveyed 20 economists from leading institutions, including the Reserve Bank of India (RBI), the National Institute of Bank Management, and private research houses. Respondents were asked to provide their best estimate of the Q2 GDP growth for the fiscal year 2024–25 (FY 2024–25). The poll’s median estimate was 7.2 % YoY, with a range of 6.6 % to 7.8 %.

“The economy remains on a positive trajectory, but the pace has slowed down slightly due to a cooling in the services sector and a temporary dip in investment momentum,” one economist noted.

The poll also highlighted that the quarter‑on‑quarter (QoQ) growth is likely to be around 1.5 %, mirroring the trend from the previous quarter. While the Q1 growth of 7.4 % was a rebound from the 5.6 % decline in Q4 2023, the Q2 projection suggests a stabilization rather than a significant acceleration.

2. Sector‑by‑Sector Breakdown

a. Services

The services sector, which contributes about 54 % of India’s GDP, is projected to add 7.5 % YoY growth in Q2. The sector’s performance hinges on IT, BPO, and financial services, which continue to benefit from global demand and domestic spending. Despite a minor slowdown in the hospitality and tourism sub‑segments, the overall services output is expected to keep the economy on track.

b. Manufacturing

Manufacturing, accounting for roughly 16 % of GDP, is expected to expand by 6.9 % YoY. Growth in the manufacturing space is underpinned by increased domestic investment and the rollout of the “Make in India” initiatives. Key sub‑sectors such as electronics, textiles, and automotive are forecasted to see a healthy uptick in production.

c. Agriculture

Agriculture remains a steady contributor, with growth projected at 4.3 % YoY. Favorable monsoon conditions in major producing states are expected to drive higher output of staples like rice, wheat, and pulses, thereby supporting rural incomes and the broader consumption base.

3. Drivers Behind the Forecast

1. Strong Domestic Consumption
   Consumption has remained the backbone of India’s growth narrative. Rising disposable incomes, particularly in the urban middle‑class segment, continue to spur demand for durable goods, real estate, and services.

2. Robust Manufacturing Output
   The government’s emphasis on “Make in India” has led to increased domestic production, supported by lower logistics costs and better infrastructure connectivity. This, coupled with foreign direct investment inflows, has nudged manufacturing growth upward.

3. Resilient Services Sector
   Despite some headwinds, the services sector remains buoyant. Global demand for IT services and digital transformation projects, coupled with domestic demand for financial services, keeps the sector’s growth trajectory positive.

4. Improved Macro‑Policy Framework
   The RBI’s accommodative stance, with a focus on maintaining inflation at the 4 % target, coupled with government stimulus measures, has helped keep monetary conditions supportive for growth.

4. Implications for Policy and Investment

The forecast suggests that while growth remains healthy, the pace is gradually normalizing. Policymakers are expected to keep the policy environment steady, focusing on:

• Maintaining Inflation Targets – The RBI’s dual mandate will continue to prioritize price stability, with a watchful eye on core inflation trends.
• Infrastructure Development – Continued investment in transportation, logistics, and digital infrastructure is expected to sustain manufacturing momentum.
• Ease of Doing Business – Efforts to streamline regulations and enhance foreign investment frameworks should keep the business environment attractive.

For investors, the forecast signals a positive yet cautious outlook. Equity markets may look for sectors that demonstrate sustained demand growth, such as consumer goods and financial services. Meanwhile, fixed‑income instruments will continue to reflect the RBI’s policy stance, with expectations of moderate yields.

5. What to Expect in the Official Release

The official data, released on 29 June 2024 by the Ministry of Statistics and Programme Implementation (MOSPI) and the RBI, will provide the final Q2 growth numbers. Market analysts anticipate that the data will confirm the 7.2 % YoY growth but may reveal nuanced variations across sectors:

• Services might show a stronger contribution, potentially nudging the overall figure closer to the upper end of the poll range.
• Manufacturing could see a slight acceleration if export orders pick up, especially in high‑tech and green‑energy sub‑sectors.
• Agriculture may be influenced by post‑monsoon yield forecasts and policy interventions aimed at rural stability.

The official report will also cover inflation dynamics, fiscal deficit projections, and the state of employment – all crucial inputs for future policy decisions.

6. Related Articles and Contextual Links

• “India’s GDP Growth Forecast for FY24-25: What the Numbers Mean” – This article delves deeper into the macroeconomic implications of the growth trajectory.
• “RBI’s Monetary Policy Outlook Amid Moderate Growth” – Provides insight into how the RBI might adjust policy rates in response to the updated growth data.
• “Infrastructure Investment and Economic Expansion in India” – Examines the role of infrastructure in sustaining manufacturing and service growth.

Bottom Line

The Zee Business poll paints a picture of an economy that, while showing signs of deceleration from the Q1 peak, remains on a solid growth path. A 7.2 % YoY growth for Q2, driven by resilient services, steady manufacturing, and a healthy consumption base, indicates that India’s economy is not only recovering from last year’s slowdown but is also poised to navigate upcoming policy and market challenges. Investors and policymakers alike will be closely watching the official data release on 29 June to calibrate expectations and strategies for the remainder of the fiscal year.