India's economy grew 7.8% in April-June quarter year-on-year, against a revised 8.6% growth in the previous quarter, the government said on Monday.

India’s economy expanded faster than expected in the April-June quarter, easing fears that the Iran war would sharply weaken growth and underscoring the resilience of Asia’s third-largest economy

Gross domestic product climbed 7.8% from a year earlier in the first quarter of the fiscal year that started in April, data from the Ministry of Statistics and Programme Implementation showed Monday. That was above the median estimate of 7.3% in a Bloomberg survey of economists, but matches the 7.8% expansion in the previous quarter.

The Reserve Bank of India had forecast 7% growth for the April-June quarter and expects the economy to expand 6.7% this fiscal year.

The stronger performance reinforces the government’s recent pitch to global investors that India can withstand external shocks. The South Asian nation has been particularly exposed to the closure of the Strait of Hormuz, a key route for oil shipments to a country that imports nearly 90% of its crude.

India remains the world’s fastest-growing major economy, but the pace falls short of the 9.25% annual growth the government estimates is needed to achieve Prime Minister Narendra Modi’s goal of developed-nation status by 2047.

Stronger growth could complicate the outlook for interest rates. The RBI kept its benchmark rate unchanged at 5.25% in August, though policymakers have signaled that a hike may be needed later this year if inflationary pressures build.