The GDP growth numbers released on Friday (August 29, 2025), showing that growth in Q1 of this financial year stood at 7.8%, came as a pleasant surprise at a time when most of the commentary has been about the factors holding growth back. For instance, even the Reserve Bank of India, as recently as August 6, 2025, had predicted that growth would be at 6.5% in Q1. It was off by a significant 1.3 percentage points less than a month before the data came out, something it must introspect about. Within the data, the strong manufacturing sector growth, of 7.7%, was especially heartening given that it came on a relatively high base of 7.6% in Q1 of last year. Some commentators have said that this is because companies were ramping up production and exports ahead of the August tariff deadline by the U.S. However, given that merchandise exports grew just 1.6% in Q1, the more likely reason is that companies were catering to domestic demand. However, the numbers released by the government do not provide much clarity here. The manufacturing sector, as measured by the Index of Industrial Production, grew at 3.3% in Q1, slower than the 4.3% seen in Q1 last year. Steel consumption was drastically slower in Q1 this year than last year. Both private and commercial vehicle sales actually contracted 5.4% and 0.6%, respectively, in Q1. Railway freight traffic grew by 2.5% versus 5% last year, while air freight grew at 5.4% compared to 13.9% last year. Two-wheeler vehicle sales contracted 6.2% while three-wheeler sales were flat at 0.1% growth. Diverse data show that the core and consumer sectors were slowing, and so the pickup in the manufacturing sector is worth a deep examination. The strong performance by the services sector is welcome, and shows how dependent the Indian economy is on this sector.