Graph-based Retrieval-Augmented Generation (GraphRAG) extends traditional RAG by using knowledge graphs (KGs) to give large language models (LLMs) a structured, semantically coherent context, yielding more grounded answers. However, GraphRAG reasoning process remains a black-box, limiting our ability to understand how specific pieces of structured knowledge influence the final output. Existing explainability (XAI) methods for RAG systems, designed for text-based retrieval, are limited to interpreting an LLM response through the relational structures among knowledge components, creating a critical gap in transparency and trustworthiness. To address this, we introduce XGRAG, a novel framework that generates causally grounded explanations for GraphRAG systems by employing graph-based perturbation strategies, to quantify the contribution of individual graph components on the model answer. We conduct extensive experiments comparing XGRAG against RAG-Ex, an XAI baseline for standard RAG, and evaluate its robustness across various question types, narrative structures and LLMs. Our results demonstrate a 14.81% improvement in explanation quality over the baseline RAG-Ex across NarrativeQA, FairyTaleQA, and TriviaQA, evaluated by F1-score measuring alignment between generated explanations and original answers. Furthermore, XGRAG explanations exhibit a strong correlation with graph centrality measures, validating its ability to capture graph structure. XGRAG provides a scalable and generalizable approach towards trustworthy AI through transparent, graph-based explanations that enhance the interpretability of RAG systems.