India's FY26 GDP Strong at 7.4%, But Economists Warn on Weak Nominal Growth

• India's FY26 real GDP projected at 7.4% by MoSPI, driven by services and manufacturing sectors.
• Nominal GDP growth estimated at only 8%, a significant drop from 9.8% last year, raising concerns.
• Economists like Kaushik Das (Deutsche Bank) and Madhavi Arora (Emkay Global) highlight risks to earnings, fiscal calculations, and market optimism due to weak nominal growth.
• Growth expected to decelerate in H2 FY26 due to diminishing base effects and moderating government spending.
• Private consumption growth (7%) and investment (7.8%) are not widespread, with auto sector and government expenditure driving limited gains.

Why It Matters: India's 7.4% real GDP is robust, but subdued nominal growth poses risks to earnings, fiscal health, and market sentiment.