Dezerv: Southern states are expected to average GDP growth of 6.8% per year between 2026-30

Southern states are expected to average GDP growth of 6.8% per year between 2026-30, with Karnataka and Telangana at the very top achieving 7.4% and 7.2% respectively. This outpaces the national forecast, as Oxford Economics projects India's real GDP to grow on average by 6.3% per year between 2026 and 2030, with total GDP reaching ₹268 trillion in real terms just over $5 trillion by 2030.

According to Dezerv’s latest Create Wealth newsletter, something profound is happening across India's southern states, a structural shift that will reshape wealth creation for the next decade. The economic centre of gravity is moving, and the implications for investors are significant.

India's professional and technological service sectors, particularly IT, will drive strong economic growth, with real gross value added (GVA) in these sectors expected to expand by nearly 9.5% per year. In Telangana, the IT sector accounts for nearly 13% of the state's economy, compared to just over 8% nationally, and is expected to grow by almost 12% on average between 2026-30. In Karnataka, information & communications makes up almost 22% of the economy, the highest among all Indian states and is forecast to grow at almost 11% per year.

Global investment flows further underline this shift. Microsoft is building AI/cloud hyperscale data centres in Hyderabad, a $17.5 billion commitment (₹1.46 lakh crore) spanning 2025-2029. Google is investing ₹51,000 crore (~$6 billion) in Asia's largest data centre in Visakhapatnam, Andhra Pradesh.

Tamil Nadu increased its GSDP from ₹26.88 lakh crore in 2023-24 to ₹31.19 lakh crore in 2024-25, recording 16% growth — the fastest among major states.

The newsletter concludes that India’s economic story is no longer monolithic. Karnataka, Telangana and Tamil Nadu are emerging as the core engines of the country’s next phase of growth.