New Delhi, Sept. 14 -- Healthy economic momentum in the first quarter of 2026-27 was being corroborated by high frequency macroeconomic indicators and strong quarterly corporate results. Still, the quarter's GDP growth of 7.8% turned out higher than market expectations. Specifically, India's sharp growth in gross fixed capital formation (GFCF) has led to expectations of a pick-up in investment-led economic expansion.

Investment in the Indian economy as reflected by GFCF recorded a strong growth of 11.9% in the first quarter of 2026-27. This is an acceleration from the growth of 10.5% recorded in the fourth quarter of 2025-26 and average growth of 7.5% in the previous three quarters.

The government's capital expenditure has played a role...