Questioning the “irrational exuberance” over the GDP numbers for April-June 2025, the Congress on Monday (September 1, 2025) said the impact of Trump tariff shocks simply is not reflected in the current figures, as their real consequences will begin to be felt in the second quarter.

According to the latest government data released last week, India’s economy grew by 7.8% in April-June, stronger-than-expected and the fastest pace in five quarters, before U.S. President Donald Trump imposed tariffs.

Congress general secretary in-charge of communications Jairam Ramesh said the front-loading of exports to the U.S. by exporters attempting to escape tariffs has actually boosted export growth and therefore the headline GDP number.

“The Trump tariff shock is simply not reflected in the first quarter of this financial year – in fact, the front-loading of exports to the U.S. by exporters attempting to escape tariffs has actually boosted export growth and therefore the headline GDP number,” Mr. Ramesh said in a post on X.

The real consequence of the tariffs will begin to be felt in the second quarter for sure, the Congress leader said. “The GDP numbers for the period April-June 2025 have led to irrational exuberance. They do present some contradictions that have been highlighted by a respected bank report and that cannot be brushed aside,” he said in his post.

Urban consumption is still “considerably weak” and rural consumption still faces structural constraints, the Congress leader said, adding that “the nominal GDP growth rate, that is, without adjusting for inflation, is still subdued and is, in fact, markedly lower than in the January-Match 2025 quarter”.

“Consumption, investment and trade are the determinants of GDP growth. But mysteriously, a full 1.8 percentage points of the quarterly growth rate is not accounted for by these three determinants. This discrepancy is very substantial and needs to be explained,” he said, adding that sales growth in the manufacturing sector, as opposed to profits growth, has continued to slow down.

On Friday (August 29, 2025), the government released the latest data showing that GDP growth in the first quarter of the ongoing fiscal year was mainly driven by a strong performance in the farm sector as well as in the services like trade, hotel, finance, and real estate.