India`s economy grew at an annual rate of 7.4% between July and September, official figures show, picking up from the 7% rate of growth in the previous quarter.
Higher domestic demand and manufacturing activity fuelled the pace, taking the rate of growth above that of China.
India`s central bank is meeting to set the level of interest rates on Tuesday.
Last month it cut rates by half a percentage point to 6.75%.
India`s economy has benefitted from a fall in commodity prices, which have made imports of heavily bought-in goods such as fuel and gold less expensive.
India`s growth has recently been outpacing China, which is growing at a rate of 6.9% according to the latest figures.
But although headline growth appears buoyant in India, the way the statistics are complied has changed recently, making comparisons difficult.
In parts of the country a drought has damaged agricultural output and farm wages for the second year running.
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