India's New GDP Series with 2022-23 Base Year to Be Released Today
The Gross Domestic Product (GDP) data for the third quarter of the current financial year 2025-26 is scheduled for release later today. This marks a significant milestone as it will be the first GDP data based on the new series adopted by the Ministry of Statistics and Programme Implementation (MoSPI). India, recognized as the world's fastest-growing major economy and on track to become the third-largest in nominal GDP terms, is implementing this update to enhance the precision of economic measurements.
Key Changes in the New GDP Data Series
The new series revises the base year for calculations to 2022-23, incorporating several vital changes aimed at providing a more accurate depiction of the Indian economy's size and its real and nominal GDP growth. Below is an expanded overview of the frequently asked questions shared by MoSPI, detailing the enhancements and methodologies.
What is Gross Domestic Product?
Gross Domestic Product, commonly known as GDP, represents the total value of final goods and services produced within the domestic economy during an accounting period. Ensuring consistent measurement methods and data sources across periods is crucial for meaningful economic assessment.
Understanding Base Year and Rebasing
The base year in National Accounts Statistics serves as the reference year whose prices are used to calculate real growth. Rebasing involves updating base-period benchmarks with new statistics to establish a revised economic structure for estimating GDP, consumer price index, and industrial production indices. This process, typically undertaken every five years as per international recommendations, incorporates new data sources and improved methodologies to reflect economic changes accurately.
Why Revise to FY 2022-23?
The base year is being updated from 2011-12 to 2022-23. MoSPI aims for periodic revisions every five years, but intervening years were unsuitable due to factors like the introduction of GST in FY 2017-18, the COVID-19 pandemic impacts in FY 2019-20 and FY 2020-21, and base-effect distortions in FY 2021-22. After detailed discussions, the Advisory Committee on National Accounts Statistics recommended 2022-23 as a normal economic year with available survey data, making it ideal for the new base.
Data Availability and International Standards
On February 27, 2026, annual and quarterly estimates for 2022-23 to 2025-26 will be released, with back-series data expected by December 2026. India's GDP estimates align with the 2008 System of National Accounts (SNA 2008), a globally accepted standard, and the country plans to shift to SNA 2025 in the next base revision. As a subscriber to IMF's Special Data Dissemination Standard, India maintains high statistical integrity.
New Data Sources and Methodological Improvements
The new series integrates several enhanced data sources and methodologies:
- Household Sector Measurement: Utilizes Annual Survey of Unincorporated Sector Enterprise (ASUSE) and Periodic Labour Force Survey (PLFS) for actual level estimates, replacing extrapolation methods.
- GST Data: Employed for cross-validation and allocation across states, improving accuracy in private corporate sector estimates.
- e-Vahan and PFMS: e-Vahan data aids in estimating Private Final Consumption Expenditure for road transport, while Public Finance Management System data enhances central government expenditure tracking.
- Updated Studies: Incorporates recent research from institutions like the Indian Grassland and Fodder Research Institute and National Dairy Research Institute for better rate and ratio calculations.
Major Methodological Enhancements
Key improvements include:
- Increased dynamism in household sector measurement through regular surveys.
- Adoption of double deflation in manufacturing and agriculture, with single extrapolation elsewhere, eliminating single deflation.
- Use of over 260 granular-level CPI items for deflation.
- Integration of Supply and Use Tables to minimize discrepancies between production and expenditure approaches.
- Segregation of multi-activity corporations using MGT-7/7A data for activity-wise value added allocation.
- Enhanced Private Final Consumption Expenditure estimation with mixed approaches and adoption of COICOP 2018 standards.
Capturing Newer Sectors and Improving Deflators
The new series better captures digital services, platform economy, and gig workers through ASUSE and PLFS surveys, with dedicated codes for activities like ride-hailing and delivery services. Deflator accuracy is improved by eliminating single deflation, applying double deflation in key sectors, and using granular-level indices. While the existing WPI with 2011-12 base is temporarily used, plans include incorporating the Producer Price Index once released by DPIIT.
Quarterly GDP Estimation and Alignment
Under the new base, quarterly GDP estimation shifts to the Proportional Denton method, reducing artificial discontinuities and ensuring smoother series. Alignment with Annual National Accounts is strengthened through consistent sectoral classification and deflation strategies, with wider use of GST data and improved benchmarking.
Impact on Common Citizens and State-Level Estimates
GDP estimates influence policy formulation, benefiting sectors like agriculture and manufacturing, and affecting investment decisions and loan capacities. For state-level consistency, Gross State Domestic Product (GSDP) series will be updated to match the new base, with methodological improvements reducing allocation-based methods and enhancing direct estimation.
The release of this new GDP series represents a pivotal step in refining India's economic data, supporting informed decision-making and reflecting the nation's dynamic growth trajectory.
