India revised its growth estimate for the current fiscal year, which ends on Mar 31, to 7.6 per cent from 7.3 per cent.
Such a strong showing in the last major economic data release before elections in May could bolster Modi’s chances after he made high economic growth one of his main platforms at rallies across the country.
The December growth “shows the strength of (the) Indian economy and its potential,” Modi said in a social media post.
Modi has sharply raised government spending on infrastructure and offered incentives to boost the manufacturing of phones, electronics, drones and semiconductors to help India compete with the likes of Vietnam and Thailand.
The manufacturing sector, which for the past decade has accounted for 17 per cent of Asia’s third-largest economy, expanded 11.6 per cent year-on-year in the December quarter, while investment growth was above 10 per cent for the second consecutive quarter, and the construction sector grew by more than 9 per cent.
“Manufacturing sector growth was supported by lower input costs,” said Rajani Sinha, an economist at CareEdge
Private consumption, accounting for 60 per cent of gross domestic product (GDP), recovered slightly in the quarter, with a 3.5 per cent year-on-year rise, compared with 2.4 per cent in the previous three months.
Government spending contracted 3.2 per cent year-on-year, compared with 1.4 per cent growth in the previous quarter.