What has changed in how India measures economic growth?

Amidst the ongoing West Asia crisis, the Indian economy is expected to take a hit: the World Bank’s latest projections suggest that the country’s gross domestic product growth could fall to 6.6% in this financial year.

The government’s own recent projections, released earlier this year, tell a more upbeat story though – a GDP of 7.6% in the current financial year, after recent updates were made in the way India measures economic growth.

The update itself was a result of a revision of the base year for computation of the Gross Domestic Product from 2011-’12 to 2022-’23, done by the Ministry of Statistics and Programme Implementation.

A revision such as this is usually conducted once in every five years where a “normal” year (without any major shocks or unusual activities) is chosen as the new base year. For India, the disruptions in economic activity from the rollout of Goods and Services Tax in 2017 and Covid-19 delayed this revision.

The previous GDP series of 2015, where the base year was revised to 2011-’12, was an update fraught with controversies. In 2018, this debate intensified: the bone of contention was the new methodology, new datasets, and the revised figure of 8.6% in 2018 (instead of 8.3%).

This time, the revisions came after a decade, and the...

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