India economic growth beats forecasts but tariffs loom

NEW DELHI, Nov 28 (AFP): India's economy grew faster than expected in the last quarter, official data showed Friday, but the impact from US tariffs is expected to bite in the rest of the financial year.

Gross domestic product rose 8.2 per cent year-on-year in the July-September period, the statistics ministry said, the fastest rate in over a year.

The growth was an acceleration from the 7.8 per cent recorded in the previous quarter and soared beyond analysts' forecasts of 7.4 per cent.

Prime Minister Narendra Modi called the figures "very encouraging", hailing in a post on X his government's "pro-growth policies and reforms".

The latest figures were spurred by higher consumer demand, solid manufacturing sector growth and statistical factors.

"Growth has exceeded expectations dramatically," Madhavi Arora, chief economist at Emkay Global Financial Services, said in a note.

She noted the "lagged effects of monetary and regulatory easing" that helped the quarterly performance, as well as a "limited" decline in exports.

Friday's reading reaffirms India's position as the fastest growing major economy and come as welcome news for policymakers grappling with a weak rupee, falling exports and a pivot away from Russian oil imports.