Archive · 15 Dec 2025
India's Economic Growth and Inflation Trends
India recently announced a high GDP growth rate of 8.2%, but the rupee fell to 90 against the dollar, and interest rates were cut.
Some people are questioning if the GDP number is accurate because other data suggests lower growth.
They also wonder why the rupee is falling if growth is strong and why interest rates were cut when growth is already high.
Meanwhile, inflation has been very low, with the overall price level rising by less than 1% in November compared to the previous year.
This low inflation rate has been part of a larger trend of decreasing inflation, which has raised questions about the accuracy of the GDP growth figures and the effectiveness of the economic policies.
India reported an 8.2% real GDP growth, but nominal GDP growth is at a six-quarter low.
The rupee fell to 90 against the dollar, raising questions about the strength of the economy.
Interest rates were cut by 25 basis points, which some argue is counterintuitive given strong growth.
Critics suggest the real GDP growth might be overstated due to an artificially low inflation deflator.
Using the core inflation rate of 4% instead of the 0.5% deflator would result in a much lower real GDP growth rate of around 3%.
- Who
- India's economic policymakers and commentators
- What
- Debate over the credibility and implications of India's recent economic policies and inflation trends
- When
- Recent (specific time not mentioned)
- Where
- India
- Why
- Contradictions in economic data and policy actions have raised questions about their validity and potential consequences
- GDP Growth
- 8.2%
- Rupee Value
- 90 to the dollar
- Interest Rate Cut
- 25 basis points
- Nominal GDP Growth
- Six-quarter low
- Inflation Deflator
- 0.5%
- Core Inflation Rate
- 4%
- Real GDP Growth (Adjusted)
- 3%
- Headline Inflation Rate (November)
- 0.7%
- Headline Inflation Rate (October)
- 0.3%
- Average Inflation Rate (Q2 FY2024)
- 1.7%
Sources
Third-Largest Economy, But Does India Have EVMs—Economically Viksit Muscles?
Benign inflationary trends leave space for RBI’s MPC to cut repo further, economists say
Inflation is low, but policymakers cannot take their eye off the ball
One Quick Look: Unpacking Nov CPI – misleading core inflation, weak demand, food pressures
India’s GDP to grow 7% in FY26, Crisil raises growth forecast
