Why in news
- The updated series of annual and quarterly GDP estimates with 2022-23 as the base year was released.
What is National Accounts Base Year Revision?
- The base year provides reference prices used to calculate real economic growth and reflect structural changes.
- Periodical revision ensures relative prices remain representative of current economic conditions.
Key Methodological Changes
- Before: Single deflation or standard methods for measuring manufacturing sector value addition.
- After: Adoption of double deflation for manufacturing industries where output and intermediate consumption are deflated separately to derive constant price GVA.
Why it matters
- The IMF describes double deflation as the preferred method for calculating GDP in volume terms.
- Incorporates new Output Producer Price Index and Banking Services Price Index based on 2022-23.
Key terms
Double Deflation
Method where output and intermediate consumption are deflated separately to obtain real GVA.
Implicit GVA Deflator
Measure derived by comparing nominal GVA with real GVA.
Prelims facts
- Base year for the updated GDP series is set at 2022-23.
Mains discussion
- Methodological refinements in national income accounting enhance data accuracy.
Source: PIB
Same topic · past papers
UPSC has asked this before
These previous-year questions sit on the same topic. Open one to practise the earlier ask.
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2026 · Q4 · GS II · 10 marks
Is the right to vote a fundamental right? Discuss the position of the Election Commission of India while undertaking the revision of electoral rolls. Can it also examine the question of citizenship of voters? -
2023 · Q11 · GS III · 15 marks
Most of the unemployment in India is structural in nature. Examine the methodology adopted to compute unemployment in the country and suggest improvements. -
2021 · Q1 · GS III · 10 marks
Explain the difference between computing methodology of India's Gross Domestic Product (GDP) before the year 2015 and after the year 2015. -
2016 · Q43 · General Studies · 2 marks
What is/are the purpose/purposes of the 'Marginal Cost of Funds based Lending Rate (MCLR)' announced by RBI? 1. These guidelines help improve the transparency in the methodology followed by banks for determining the interest rates on advances. 2. These guidelines help ensure availability of bank credit at interest rates which are fair to the borrowers as well as the banks. Select the correct answer using the code given below