India’s strong GDP growth raises questions over jobs, incomes, consumption and the reliability of its numbers
Undeterred by geopolitical tensions and uncertainty around global trade, India’s GDP grew by 7.8% in the first quarter of FY2026-27. The International Monetary Fund (IMF) has described India as one of
the world’s fastest-growing economies. However, the UN’s Department of Eco-nomic and Social Affairs has lowered India’s growth projection for FY 2026-27 to 6.4% citing risks amidst the rising oil prices, West Asia crisis and weak monsoons.
While financial gurus and political pundits debate over the economic numbers, there are genuine concerns among common folks whether a 7.8% GDP is translating into better lives for ordinary Indians.
Voices From The streets
There are concerns over people’s consumption power, unemployment, inflation, private investments and the stock market figures. Anita Fernandes, a home chef and single mother of two daughters says that everything has become expensive. “I don’t know how accurate these GDP numbers are. Earlier, we bought 1 litre fresh milk for
Rs 92. Now it costs Rs 111. Our monthly budget has stretched, but my salary is still the same. There’s been no hike,” rues Anita.
Airing a similar view, Shailesh Gaikwad (39), a marketing manager, who is repaying a home loan
says, “After the recent RBI
repo rate hike, now my bank has increased the interest
rate on home loan from 7.90% to 8.15%.”
Money Matters
The debate over how growth is measured is only one part of the larger picture. The working class is simply struggling to make ends meet. Even if the GDP numbers are accepted, it is crucial to examine if consumption, income, employment and private investments are growing simultaneously. “A person’s nominal salary may increase, but if taxes and essential expenses consume a larger share of that income, their ability to save and spend can still remain under pressure,” explains Vijay Agarwal, a Chartered Accountant.
The Full Picture
India recently overhauled its methodology to calculate GDP. In February 2026, the Ministry of Statistics and Programme Implementation introduced a new GDP series, replacing the 2011-12 base year with 2022-23. The revised methodology brings to light a newer data source and reforms in the way sectors are measured.
Dr. Santosh K. Mehrotra, a development economist says, “I don't take first quarter growth and it’s not something we should start jumping up and down about. We should stop pretending that we are America.”
A growing number of voices are raising doubts over the latest GDP figure. Former Finance Secretary, Subhash Chandra Garg said in media interviews that: “Last year’s current GDP of 86 trillion rupees has been revised down to 80 trillion rupees to make this year’s GDP look better. If last year’s number would not have been revised, the growth would have been 2.6%.”
Even if the GDP growth is accurate, does it reflect the broader health of the Indian economy and translate into gains for individuals and households?
Wages Lag Behind Growth
Given the rising cost of living, a bigger question emerges. Is income rising faster than the cost of living? Is it translating into a stronger purchasing power of individuals and households? Dr Mehrotra notes, “When the country
was growing rapidly, we could see that in the real wages of people. Today, the claim is that the growth is 7.8% but it cannot be seen.”
There has been a slight rise in average earnings, but that has not brought much change in the purchasing power of an
average Indian. Akshita Sharma, a young professional says, “7.8% GDP growth is a positive number in an economic sense. but I don’t see a lot of it reflected in everyday life. Even in big cities, I see young graduates struggling to find well-paying jobs. The cost of living has been on the rise.”
Employment Dilemma
One of government's recent statistics say that one out of three Gen-Zers are currently out of work, which accounts for about 33% Indians belonging to that age bracket.
If the GDP growth is translating into quality employment, then why are so many young graduates still struggling to find good jobs, build financial stability and improve their standard of living.
Srotaswini Dash, an Economics Professor sums it up well, “Consumption tells us about present demand. Invest-ment tells us about future capacity and employment tells us whether people are participating in that growth.”
GDP Booming, Stocks Crashing
The Indian economy is booming at an enviable pace, but the stock market is tanking. Many mom-and-pop investors have already seen a 10-15% dip in their equity returns. “If the GDP is doing well, then why are stocks doing so badly? Rising oil prices and the
falling rupee is taking a toll on everybody’s savings,” says Jignesh Shah, a stock broker from Mumbai.
Some economic experts say in hush tones that India has moved from an agile economy to a fragile economy. But everybody is hopeful that things
end on a happy note, literally and economically.
I don’t know how accurate these GDP numbers are. Earlier, we bought 1 litre fresh milk for `92. Now it costs `111.”
— Anita Fernandes, home chef and single mother
After the recent RBI repo rate hike, now my bank
has increased the interest rate on home loans from 7.90% to 8.15%.”
— Shailesh Gaikwad, Marketing Manager
Consumption tells us about present demand. Investment tells us about future capacity and employment tells us whether people are participating in that growth.”
— Srotaswini Dash, Economics Professor
I don't take first quarter growth and it’s not something we should start jumping up and down about.”
— Dr Santosh K. Mehrotra, Development Economist
