Hello, hello. After being busy with some personal things, I am finally back to writing about finance. As usual, I first wondered: what do I write about?
Then I saw the news about India's GDP growth for the first quarter of 2026–27. The number was 7.8%. It sounded impressive. The Prime Minister highlighted it, the headlines repeated it, and yet my first reaction was not excitement. It was suspicion.
How can an economy grow that quickly when so many people still struggle with unemployment, weak infrastructure, poor education, inequality, violence, and a lack of political will? Then I read that the way GDP is calculated had changed. My immediate thought was: did the government change the calculation simply to make India look better?
That question soon turned into a more personal one. If I do not trust the number, should I still invest in the Indian stock market?
What the 7.8% Number Actually Means
First, I had to clear up my own confusion about the date. “Q1 of FY 2026–27” does not mean January to March 2027. India's financial year runs from April to March, so this figure covers April to June 2026.
According to the official GDP release, India's real GDP—GDP measured at constant 2022–23 prices—was estimated to have grown by 7.8% compared with the same quarter a year earlier. The government reported nominal GDP growth, which includes price changes, at 10.3%.
So 7.8% is not a claim that every Indian became 7.8% richer, that employment improved by 7.8%, or that public services became 7.8% better. It is an estimate of how much the economy's inflation-adjusted output grew compared with the same three months in the previous financial year.
Why I Do Not Trust the 7.8% Headline at Face Value
The calculation really did change. India introduced a new GDP series with 2022–23 as its base year and added updated price indices, administrative records, and other data sources. In the process, earlier GDP estimates changed substantially.
The analysis presented by Ravish Kumar focuses on an argument made by former Finance Secretary Subhash Chandra Garg. When the Q1 FY 2025–26 numbers were originally released, nominal GDP was reported as ₹86.05 lakh crore and real GDP growth was celebrated as 7.8%. After the statistical series was changed, the previous year's nominal GDP base was brought down to around ₹80 lakh crore, while its real growth rate is now shown as 6.9%.
Garg's calculation uses the originally published ₹86.05 lakh crore figure and compares it with the current quarter's ₹88.27 lakh crore. On that basis, nominal GDP growth comes to roughly 2.6%, not 10.3%. He then argues that after accounting for inflation of around 2% to 2.5%, real growth would be close to zero rather than 7.8%.
This is Garg's disputed calculation, not the government's official estimate. The government's response is that the old and new series should not be mixed: once the methodology and base year change, both periods must be recalculated using the same series. The statistics ministry published a detailed clarification defending the revisions and explaining the new producer-price data, double deflation, and the gap between nominal and real growth.
Technically, the government is saying that Garg's ₹86.05 lakh crore base is no longer comparable with the current number. Garg's criticism is that such a large revision of the earlier base makes the new headline growth rate look much stronger, and that the originally announced number should not simply disappear from public memory.
I find this criticism convincing. Last year, 7.8% was announced and celebrated. Now that same quarter is shown as 6.9%, while a fresh 7.8% is being celebrated again. The government may have a technical explanation for the revision, but a change this large deserves far more public attention and independent scrutiny than it receives. So I do not feel comfortable treating the latest 7.8% headline as an unquestionable description of India's economy.
GDP Growth and Daily Life Are Not the Same Thing
This is where I think much of the anger comes from. People hear “7.8% growth” and compare it with what they see around them. If jobs feel insecure, roads are poor, schools are struggling, women do not feel safe, and ordinary families remain under pressure, the headline can feel disconnected from reality.
The video that changed my understanding points to some uncomfortable numbers: youth unemployment reached 16% in June, more than 80 crore people continue to receive free food grains, and a NITI Aayog report reportedly counted more than eight crore people aged 15 to 29 who were neither studying, training, nor working. It also points to another two crore young people who were actively looking for work but could not find it.
GDP measures total economic activity. It does not tell us how evenly the gains are distributed, whether enough good jobs were created, whether public services improved, or whether people feel secure. Growth can be concentrated in a few industries or among people who already own substantial assets. A country can produce more while still failing many of its citizens.
Those realities do not calculate GDP for us, but they do explain why the headline feels so difficult to believe. If a method produces spectacular growth while employment, savings, demand, and daily life remain under such pressure, the method deserves to be questioned. GDP is one measure, not a complete report card for a country—and no government should use it to dismiss what people experience every day.
The Stock Market Tells a Different Story
I initially heard that the Indian stock market had performed terribly for five years. The source I watched makes a more specific claim: returns have been poor over roughly the past two years, the index had gone nearly 700 days without surpassing its all-time high, and India had become one of Asia's weaker-performing markets during this period.
The Nifty 50 factsheet dated August 31, 2026 supports the point about recent weakness: the price index was down 7.84% for the year to date and down 1.42% over one year. It also shows why I should not describe the entire five-year period as negative. Over five years, its price return was still a positive 7.05% per year, while the total return including dividends was 8.32% per year.
So the accurate description is not that the market lost money throughout five years. It is that recent performance has been poor despite the government's strong growth headline. The market also fell immediately after the GDP release, although one or two trading sessions alone cannot prove whether a GDP calculation is right or wrong.
It also reminds me that GDP and stock-market returns do not move together neatly. Share prices depend on how expensive stocks already are, company profits, interest rates, currency movements, foreign investment flows, and what investors expect to happen next. A country can report strong GDP growth while its market falls. A slower-growing country can sometimes deliver better market returns if its companies were priced more reasonably.
One GDP figure is therefore not a reason to buy a market, and one bad year is not automatically a reason to abandon it.
My Real Problem Is Uncertainty
My decision is not just about India. I currently live in the Netherlands, but I do not know whether I will remain here permanently. What if I lose my job? What if my residence situation changes? What if I eventually have to return to India?
That uncertainty is why I have investments connected to both places. I hold much of my portfolio through the Netherlands, with exposure beyond one country, while continuing to invest a smaller portion in India.
This is not only an emotional decision. The country and currency in which I may eventually spend money matter. If I return to India, having some rupee-based assets may be useful. If I remain in Europe, euro-based expenses will matter more. And for long-term growth, broad global diversification can reduce my dependence on the future of either country.
Money that may be needed soon for an emergency or a move should not depend entirely on the stock market. Long-term money can take more risk, but even then I do not need to make one country carry my whole future.
India Is Bigger Than One Government
I remain deeply unhappy with many things happening under the current government. But governments eventually change. India is bigger than one prime minister, one political party, and one quarterly statistic.
I hope the country will eventually be led by people who care more about institutions, public services, safety, opportunity, and the everyday lives of its citizens. I do not need India to become a “superpower.” I would rather see it become a better country for the people living there.
Still, hope alone is not an investment strategy. I should not put everything into India because I hope its politics will improve, and I should not sell everything because I dislike its present politics. My allocation should reflect my goals, time horizon, future spending needs, and ability to tolerate risk.
For now, that means continuing with a diversified global portfolio while keeping a smaller allocation to India. I can question official numbers, criticize a government, and still avoid turning that anger into an all-or-nothing financial decision.
Never put all your eggs in one basket. It is an old sentence, but sometimes the simplest lesson is still the most useful one.