Uday Kotak sees GDP resilience, warns India not to lower guard

New Delhi: India's stronger-than-expected 7.8 per cent GDP growth in the April-June quarter offers reason for optimism, but unresolved geopolitical tensions, the rapid progress of artificial intelligence and volatility in US bond yields mean the country cannot afford to lower its guard, veteran banker Uday Kotak said.

Reacting to the Q1 FY27 GDP data in a social media post, Kotak said India had demonstrated resilience even during what he described as the peak period of the Iran conflict.

Also Read: India’s Q1 GDP growth quickens to 7.8% as consumption, capex offset US-Iran war shock


"India GDP growth Q1 (April-June) at 7.8%. This was the peak period of Iran conflict. India has shown resilience vis a vis concerns in March and April," Kotak said.

However, he cautioned that several risks remained ahead for the economy.

"However, Middle East is still unresolved, AI game is full on, and US bond yields are playing truant," Kotak said.

His comments came a day after official data showed India's real GDP grew 7.8 per cent in the first quarter of financial year 2026-27, exceeding the Reserve Bank of India's earlier estimate of 7 per cent. Real GDP was estimated at Rs 81.36 lakh crore during the quarter, compared with Rs 75.46 lakh crore in the year-ago period.

Kotak also pointed to India's foreign currency deposits as providing some cushion against external risks.

"India has also bought insurance with ~ $100 bn+ Foreign Currency deposits for 3 to 5 year maturity," he said.

Nominal GDP during the quarter stood at Rs 88.27 lakh crore, up 10.3 per cent from Rs 80 lakh crore in Q1 FY26. Real Gross Value Added (GVA) also grew 8.2 per cent during the quarter.

Also Read: Industry cheers 7.8% Q1 GDP growth, economists see India’s momentum holding

The stronger-than-expected growth came despite global uncertainties and headwinds, according to the previous GDP report. The estimates, however, are subject to revisions, with the Ministry of Statistics and Programme Implementation noting that improved data coverage and revisions in source data could affect subsequent estimates.

Looking ahead, Kotak struck a cautiously optimistic tone, saying the latest performance provides some relief but should not lead to complacency.

"For us, it is time to feel better, but have work to do, and let us not lower guard," he said.

The next quarterly GDP estimates, covering July-September 2026, are scheduled to be released on November 30.