India's national accounts in practice: agencies, releases, revisions and sectoral GVA

Detail

1. Who compiles India's GDP

• National Statistical Office (NSO) is the agency that compiles GDP. It works under the Ministry of Statistics and Programme Implementation (MoSPI).
• In 2019 the CSO (Central Statistical Office) and the NSSO (National Sample Survey Office) were merged to form the NSO.

• NCERT uses the old name "CSO". The current name is NSO.

• How the data is collected (Class 10): a central ministry collects data on quantities (volume) and prices. State and UT departments help it.

• State GDP (GSDP): NSO issues the guidelines. The Directorates of Economics and Statistics (DES) of each State/UT compile their own GSDP. They follow uniform definitions and methods [3].
• Expert body: the Advisory Committee on National Accounts Statistics (ACNAS) was set up in 2024 to advise MoSPI on methods and new data sources [3].

• It had 5 sub-committees and 56 experts, who held 39 meetings over two years to prepare the new series [3].

• Where the data comes from, by institutional sector [3]:

• Private companies (non-financial corporations): company filings with the corporate registry.
• Financial sector: regulators such as the RBI and SEBI.
• Government: central and state budget documents, and local body accounts.

• Households and non-profits: surveys such as ASUSE and PLFS.

• Government GVA is measured by its costs. Government services are not sold in a market, so there is no sales value. Instead:

• Government output = compensation of employees (salaries, pensions) + intermediate consumption (electricity, office supplies) + consumption of fixed capital (depreciation) [3].

• International data standard: India subscribes to the IMF's Special Data Dissemination Standard (SDDS), a global benchmark for publishing economic data on time and openly [3].

2. Release sequence for one financial year

Estimates for a year come out in stages. The first figure is released before the year is even over. It is then revised as fuller data arrive.

Release	Timing (NCERT scaffold)	Latest practice (2025-26 cycle)	Main use
First Advance Estimates (FAE)	Early January	January 2026 [4]	Feed the Union Budget
Second Advance Estimates (SAE)	End-February	27 February 2026, using data up to Q3 [4]
Provisional Estimates (PE) (the first full-year figure, released together with Q4 GDP)	31 May	5 June 2026 [4]	e.g. NCERT's 2024-25 tables
First, Second and Third Revised Estimates	In later years	2024-25 shown as the First Revised Estimate (FRE) in June 2026 [4]. The National Accounts Statistics (NAS) publication of 31 August 2026 revised 2022-23 to 2024-25 [5].	As fuller data arrive
Quarterly GDP	About 2 months after each quarter ends	Q1 2026-27 released 31 Aug 2026. Q2 is due 30 Nov 2026 [5].

• Why revisions happen: source agencies send fuller or corrected data later. MoSPI therefore says estimates are "likely to undergo revisions" as per the release calendar [5].
• Worked example (2025-26):
• The PE of 5 June 2026 put real GDP growth at 7.7% [4].
• On 31 August 2026 the NAS publication revised the PE again. It added the new Producer Price Index (PPI) and IIP (both base 2022-23) [5].

• So one year's growth rate can change several times after it is first announced.

• How quarterly GDP is estimated: the Benchmark-Indicator method.

• The previous year's annual estimate is the starting point (the benchmark).
• It is carried forward using fast, high-frequency data (the indicators): GST data, IIP, steel use, vehicle sales, cargo, air traffic, bank credit and others [4].
• India follows the IMF Quarterly National Accounts Manual, 2017. The new series uses proportional Denton benchmarking, a smoothing method that makes the four quarters add up to the annual total [3][4].

3. Standards: SNA 2008 → SNA 2025

• System of National Accounts (SNA) is the international rulebook for measuring GDP.
• SNA 2008 was issued jointly by the UN, IMF, World Bank, OECD and EU.

• India's 2011-12 series adopted it (footnote to Class 12, Table 2.4).

• 2025 SNA was adopted by the UN Statistical Commission in March 2025. It gives more attention to digitalisation, well-being and sustainability.

• India's current position:
• The new 2022-23 series still follows SNA 2008 [3].
• Countries are expected to adopt SNA 2025 during 2029-30.

• India plans to shift to SNA 2025 at its next base revision [3].

• How often the base year is revised: MoSPI aims to revise the base year about every five years, as international practice recommends [3].

4. The new series: base year 2022-23

• Release date: MoSPI released the new GDP series (base 2022-23) on 27 February 2026. It replaces the 2011-12 series [2][4].
• New CPI (base 2024) was released on 12 February 2026 [2].

• New IIP (base 2022-23) was scheduled for May 2026 [2].

• Why 2022-23 was chosen:

• A base year must be a "normal" year, with no major shock.

• The years 2017-18 to 2021-22 were ruled out. The GST rollout needed time to settle, and then came COVID-19 [3].

• Back series: this means re-estimating past years with the new methods so that old and new figures can be compared.

• It is expected by December 2026 [3].
• Past years will be recomputed back to the old base (2011-12). Earlier years, back to 1950-51, will be linked by the splicing method (joining the two series at a common point) [3].

New data sources in the 2022-23 series

• ASUSE (Annual Survey of Unincorporated Sector Enterprises: a yearly survey of small, unregistered businesses) and PLFS (Periodic Labour Force Survey) [3].
• They now give direct yearly level estimates of the household and informal sector.

• Earlier, the base-year figure was simply grown forward using proxy indicators.

• HCES (Household Consumption Expenditure Survey) is used more to estimate PFCE (private final consumption expenditure: what households spend on final goods and services).

• It is combined with direct estimation and the commodity-flow method.

• The COICOP 2018 consumption classification has also been adopted [3].

• GST data is used for three things [3]:

• dividing the all-India private corporate estimate among States;
• cross-checking the annual estimates;

• splitting annual figures into quarters (quarterisation) and serving as a quarterly indicator.

• e-Vahan (vehicle registration data) is used to estimate household spending on road transport [3].

• PFMS (Public Financial Management System) gives actual central government spending instead of Revised Estimates from the Budget [3].
• MCA forms MGT-7/7A let MoSPI split a multi-activity company's GVA across its different businesses. Earlier, all its output was put under its main business [3].
• Hired domestic workers (cooks, drivers, cleaners) are counted in GDP. The estimate uses PLFS worker numbers and wages [3].

5. Debates over the 2011-12 series and how the new series responds

(a) MCA-21 and the "blow-up" problem

• MCA-21 is the Ministry of Corporate Affairs' online system where companies file their accounts. The 2011-12 series used it for corporate GVA.
• Blow-up: not all companies file on time. So the GVA of filing companies was scaled up to cover non-filers.
• Criticism: the database included shell companies (companies that exist only on paper) and inactive companies. Scaling up with them could overstate output.
• New series: MCA-21 data is still used. Digital and platform companies were already covered through it [3]. The MGT-7/7A split by activity is a new refinement [3].

(b) Informal sector measured through formal-sector proxies

• In the old series, informal output was often moved forward using formal-sector indicators.
• After demonetisation (2016) and GST (2017), the formal sector did better than the informal sector. So this method likely overstated informal output.
• New series: direct yearly estimates from ASUSE and PLFS replace the proxies [3].

(c) Single vs double deflation

• Deflation means removing the effect of price changes to get real (volume) growth.
• MoSPI's own example [3]:
• 100 bicycles at ₹1,000 each = ₹1,00,000.
• Next year, 100 bicycles at ₹1,100 each = ₹1,10,000.

• Nominal growth is 10%, but real growth is 0%.

• Single deflation: one price index is used to deflate the whole GVA (or output only).

• Double deflation: output and inputs are deflated separately, each with its own price index.

• Real GVA = Real output − Real intermediate consumption [5]

• Worked example: why single deflation misleads when input and output prices move apart.

• Base year: output ₹100, inputs ₹60, so GVA = ₹40.
• Next year: same physical quantities. Output price is unchanged. Input price (for example, crude oil) falls 20%.
• Nominal inputs = ₹48, so nominal GVA = 100 − 48 = ₹52.
• Single deflation with the output price index (0% change): real GVA = ₹52. This shows +30% "growth", but nothing more was produced.
• Double deflation: real output = 100/1.00 = 100. Real inputs = 48/0.80 = 60. Real GVA = ₹40, so 0% growth, which is correct.

• This is the core criticism of manufacturing GVA in the 2011-12 series in years when commodity prices fell.

• New series [3][5]:

• Single deflation has been "completely done away with".
• Double deflation is used for manufacturing and agriculture. Other sectors use single extrapolation (moving a base figure forward with a volume indicator).
• More than 300 item-level price indices are used.

• The new output PPI was incorporated in August 2026.

• One new side-effect [5]:

• Under double deflation, the manufacturing GVA deflator can fall, or even turn negative.
• This happens when input prices rise faster than output prices.

(d) Discrepancies between the production side and the expenditure side

• Statistical discrepancy = GDP from the production side − GDP from the expenditure side. In theory the two should be equal.

• It arises because some spending data are missing or arrive late [3].

• Size (2025-26 PE, constant prices): discrepancies were ₹3,89,909 crore, or 1.2% of GDP. In the base year 2022-23 they were zero [4].

• New series fix: Supply and Use Tables (SUT) [3]
• The SUT balances every product using this identity:
• Output + Imports = Intermediate consumption + Final consumption expenditure + Capital formation + Exports

• Mismatches are corrected product by product, so the discrepancy is "minimised/eliminated".

• SNA advice [3]:

• either publish the discrepancy openly next to GDP;
• or reconcile the two sides using the SUT.

(e) The 2019 overestimation claim

• Former CEA Arvind Subramanian argued that growth from 2011-12 to 2016-17 was overstated by about 2.5 percentage points a year.
• The EAC-PM (Economic Advisory Council to the Prime Minister) and the government rejected the claim.
• Exam angle: the 2022-23 series answers several of the points raised in this debate: proxies, single deflation and discrepancies.

6. Headline numbers under the new series

• Basic identity: GDP = GVA at basic prices + Net taxes on products (taxes on products minus subsidies on products) [3].

• Worked example (2025-26 PE, constant prices): ₹294.91 lakh crore (GVA) + ₹28.21 lakh crore (net taxes) = ₹323.12 lakh crore (GDP) [4].

• 2025-26 Provisional Estimates (5 June 2026) [4]:

• Real GDP growth was 7.7% (7.1% in 2024-25). Nominal GDP was ₹346.36 lakh crore, a growth of 8.9%.
• Real GVA growth was 7.9%. Nominal GVA growth was 9.1%.

• Per capita NNI at current prices was ₹2,08,090. Population was taken as 1,421 million.

• Latest quarter: Q1 (April–June) 2026-27, released 31 Aug 2026 [5]:

• Real GDP grew 7.8% and real GVA grew 8.2%.
• GFCF grew 11.9% and PFCE grew 7.1%.

7. Sectoral structure of GVA

What NCERT shows (Class 10, Graphs 1–3; 1977-78 to 2017-18)

• Output grew in all sectors, but most in the tertiary (services) sector.
• By 2017-18 the tertiary sector had replaced the primary sector as the largest producer.
• Output grew much faster than jobs:
• Industrial output rose more than 9 times, but industrial employment rose only about 3 times.

• Services output rose about 14 times, but services employment rose only about 5 times.

• Result: more than half of all workers are still in the primary sector, but they produce only about one-sixth of GVA.

• This is underemployment, also called disguised unemployment: more people work on a task than it needs, so taking some away would not reduce output.
• NCERT example: Laxmi's family on a 2-hectare rain-fed plot. All members work, but the farm does not need all of them.

Current shares of nominal GVA (2025-26 PE) [4]

Broad sector	2022-23	2025-26 PE
Primary (agriculture + mining)	22.1%	19.9%
Secondary (manufacturing, utilities, construction)	26.0%	25.8%
Tertiary (services)	51.9%	54.3%

• Sub-sector shares, 2025-26 [4]:
• Agriculture, livestock, forestry and fishing: 18%
• Manufacturing: 15%; construction: 8%; mining: 2%; utilities: 3%
• Financial, real estate, IT and professional services: 27%, the largest single group
• Trade, hotels, transport and communication: 14%

• Public administration, defence and other services: 13%

• Matching this to the scaffold's shares:

• The scaffold's "industry 27–28%" is roughly secondary (25.8%) plus mining (about 2%).

• So the scaffold (agriculture 16–18%, industry 27–28%, services 54–55%) broadly fits the new-series data [4].

• Real GVA growth by sector, 2025-26 PE [4]:

• Agriculture: 3.0%; mining: 5.2%
• Manufacturing: 10.7%
• Electricity and utilities: 1.7%; construction: 7.4%
• Trade, hotels, transport: 11.0%; financial, real estate, professional services: 10.4%
• Public administration: 5.0%

• By broad sector: primary 3.2%, secondary 8.8%, tertiary 9.3%.

• Quarterly shares move with the seasons. In Q1 2026-27 the primary share was 19.6% and the tertiary share 55.7% [5]. Quarterly shares change with the harvest cycle, so use annual shares in answers.

• The full structural-change story is in the sectors-of-economy note.

8. Saving and investment

• Gross domestic saving is the total saving of households, private companies and the public sector in a year. The scaffold puts it at about 30% of GDP (verify current).
• Official figure: gross saving was 30.3% of GNDI in 2023-24 and 29.7% in 2022-23 (old 2011-12 series) [6].
• GNDI (Gross National Disposable Income) = national income plus net current transfers from abroad, such as remittances.

• The household sector provided 59.0% of gross saving in 2023-24 [6].

• GFCF (Gross Fixed Capital Formation: spending on new machines, buildings and infrastructure). The scaffold puts it at about 30–34% of GDP (verify current).

• 2025-26 PE: 31.9% of GDP at current prices and 32.3% at constant prices [4].

• Q1 2026-27 was higher, at 34.3% at current prices, but this is a single quarter [5].

• Other expenditure shares, 2025-26 (current prices) [4]:

• PFCE: 56.7% of GDP

• GFCE (government final consumption expenditure): 10.7%

• Mains data point: household net financial savings = gross financial savings − new borrowing (financial liabilities).

• They fell to multi-decade lows in 2022-23 as household borrowing rose (verify current).
• Chain of cause and effect: household borrowing rises → net financial savings fall → less domestic money is available to fund investment.

Prelims Hooks

• NSO was formed in 2019 by merging CSO + NSSO. It works under MoSPI and compiles GDP.
• The new GDP base year is 2022-23, released on 27 February 2026. The new CPI base is 2024. GDP and IIP share the 2022-23 base [2].
• The new series follows SNA 2008. India plans to adopt SNA 2025 at the next revision; countries are expected to adopt it during 2029-30 [3]. Trap: the 2022-23 series is not on SNA 2025.
• Double deflation: Real GVA = Real output − Real intermediate consumption. The new series uses it for manufacturing and agriculture, and single deflation has been abolished [3][5].
• The Supply and Use Table identity is Output + Imports = Intermediate consumption + Final consumption + Capital formation + Exports. It is used to cut the statistical discrepancy [3].
• GDP = GVA at basic prices + Net taxes on products (product taxes − product subsidies).
• Release order: First Advance Estimates (Jan) → Second Advance Estimates (Feb) → Provisional Estimates (end-May/early June; 5 June 2026) → First, Second, Third Revised Estimates. Quarterly GDP comes about 2 months after each quarter ends [4][5].
• Quarterly GDP uses the Benchmark-Indicator method, following the IMF Quarterly National Accounts Manual 2017 [4].
• ASUSE (unincorporated enterprises) and PLFS now give direct yearly estimates of the informal sector. e-Vahan feeds transport spending, and PFMS gives actual central government spending [3].
• Largest GVA group (2025-26): financial, real estate, IT and professional services at 27%. Agriculture is 18%. The primary sector fell below 20% (19.9%) [4].

Mains Points

• Credibility of data as a public good. The 2011-12 series faced four main criticisms: MCA-21 blow-up, informal-sector proxies, single deflation and large discrepancies. The 2022-23 series answers these with direct ASUSE/PLFS estimates, double deflation, SUT balancing and more than 300 granular price indices [3]. Trust in the numbers matters for monetary policy, the Budget and Finance Commission transfers. Remaining gaps: the back series is due only by December 2026, and SNA 2025 is still ahead.
• Revisions are a trade-off between speed and accuracy. The Advance Estimates feed the Budget before the year ends. Later revisions can change the growth story; for example, the 2025-26 PE was re-revised in August 2026 when the new PPI and IIP came in [4][5]. Policymakers should read "headline" growth together with the revision history.
• Growth without enough jobs. Services now produce 54.3% of GVA, while agriculture produces 18% [4], yet more than half of workers still depend on the primary sector. This points to disguised unemployment, low farm productivity and the need for labour-intensive manufacturing and skilling (GS-III: inclusive growth, employment).
• The savings–investment balance. GFCF is about 32% of GDP (2025-26) [4] and gross saving about 30% of GNDI (2023-24) [6]. Falling household net financial savings (2022-23) raise questions about how investment will be financed, and about household debt risks for financial stability.