What India needs for its next growth leap

India’s 7.8 per cent real GDP growth in the first quarter of 2026-27 has become a test of political allegiance: a strong number is dismissed as propaganda, while a weak one is presented as proof of failure. National accounts deserve rigorous scrutiny. But scrutiny must begin with comparable numbers.

The widely circulated claim that growth was effectively 2.6 per cent does not meet that test. It compares the latest nominal GDP estimate under the new 2022-23 base-year series with the previous year’s estimate drawn from the older 2011-12 series. On the official like-for-like series, real GDP rose from ₹75.46 lakh crore to ₹81.36 lakh crore, while nominal GDP increased from ₹80 lakh crore to ₹88.27 lakh crore. Real GVA grew 8.2 per cent, services expanded 10 per cent and private consumption rose 7.1 per cent.

Official statistics are not beyond question. A major rebasing should come with accessible bridge tables, detailed source notes and independent engagement so revisions can be understood and tested. Trust grows through transparency. But disagreement cannot begin by combining two different statistical series and calling the result an alternative growth rate.

Even this debate, however, is too narrow. A quarterly number is a snapshot. India’s larger story is the economic and institutional capacity built over the past 10 to 12 years. India is not approaching its development challenge from a standing start.

The policy architecture has changed substantially. Good and Services Tax (GST) created a national indirect-tax framework and made activity more visible. The Insolvency and Bankruptcy Code changed the relationship between borrowers and creditors, although judicial delays constrain outcomes. Real Estate Regulation Act (RERA) introduced accountability in real estate. Corporate processes, tax administration, procurement and business approvals have moved online. More than 47,000 compliances have been removed, while the National Single Window System is turning government clearance into an integrated digital process.

The most consequential shift has been the creation of digital public infrastructure. Aadhaar supplied a population-scale identity layer; Jan Dhan brought millions into formal banking; and mobile connectivity made those systems usable. UPI, which began public operations in 2016, processed a record 24.51 billion transactions worth ₹29.82 lakh crore in August 2026. This is not simply a payments achievement. It is shared economic infrastructure on which banks, fintech firms, merchants and citizens can innovate at extremely low cost.

The same rails have changed governance. India had 59.09 crore Jan Dhan accounts by August 2026, and cumulative Direct Benefit Transfers had crossed ₹49 lakh crore by January. Welfare can now move directly to an authenticated beneficiary, leaving a visible and auditable trail. The deeper principle is important: the state builds interoperable public rails, private enterprise innovates on top of them, and citizens gain choice.

Physical capacity has expanded alongside digital capacity. Public capital expenditure has risen from about ₹2 lakh crore in 2014-15 to ₹12.2 lakh crore in 2026-27. National highways are roughly 61 per cent longer than in 2014, and the number of operational airports has risen from 74 to 165. Meanwhile, Startup India has grown from a few hundred recognised firms in 2016 to more than 2.3 lakh by June 2026. These changes compound: better logistics enlarges markets, digital identity lowers transaction costs, formalisation improves access to credit, and entrepreneurship converts access into opportunity.

The next debate, therefore, should not be about whether India has changed, but about what this accumulated capacity can now make possible. The next phase of the country’s growth journey will be shaped by the translation of economic expansion into higher productivity, rising incomes and a better quality of life. As this process gathers momentum, its impact will become increasingly visible in the creation of high-quality jobs, stronger cities, better schools and healthcare, more competitive manufacturing and higher farm productivity.

The reforms of the past decade have created the foundations for this transition. The journey ahead will increasingly move towards lower costs of capital and logistics, faster contract enforcement, simpler regulation at the state and municipal levels, and deeper investment in research and human capability. Early momentum in semiconductors, artificial intelligence, clean energy and advanced manufacturing can grow into globally relevant industrial depth. Digital public infrastructure, having expanded access at population scale, will enter its next stage through the use of consented data and responsible AI to improve credit, healthcare, education and public services.

Seen in this light, Viksit Bharat represents the next stage of a journey that began with building capacity and is now moving towards converting that capacity into outcomes. The foundations are considerably stronger than they were a decade ago. As institutions become faster, markets deepen and opportunity spreads more widely, the character of India’s growth will also evolve. The 7.8 per cent growth figure deserves a fair reading, but the larger story is the progression from a decade of institution-building to the next leap in national prosperity.

The author is Head and co-founder of Digital India Foundation and adjunct professor at IIT BHU and Ashoka University.

Disclaimer: The views expressed are the author’s own and do not reflect the official policy or position of Financial Express.