Getting India’s economic numbers right

Economic policy is only as credible as the data that underpins it. In an economy as large, diverse and fast-changing as India’s, the challenge is not merely to count more, but to count what truly matters. Over the past decade, the structure of the Indian economy has shifted markedly, services have expanded, digital platforms have altered production and consumption, and formalisation has accelerated through reforms such as GST. Against this backdrop, India’s ongoing overhaul of its national accounts and core economic statistics deserves close attention, not as a technocratic exercise, but as a foundational reform shaping how growth, inflation and employment are understood.

At the heart of this modernisation is a coordinated revision of base years across major macroeconomic indicators. The decision to rebase GDP estimates to 2022 23, revise the Consumer Price Index to a 2024 base, and align the Index of Industrial Production to 2022 23 reflects a recognition that outdated reference points can distort policy signals. Over time, relative prices change, new industries emerge, and older sectors decline. If statistical systems fail to keep pace, they risk misrepresenting economic reality, leading to suboptimal decisions by governments, central banks and businesses.

The choice of 2022 23 as the new GDP base year is particularly significant. The pandemic years were marked by unprecedented disruptions to production, consumption and labour markets. Rebasing to a post pandemic normal year helps ensure that structural shifts are captured without the noise of temporary shocks. Importantly, the revision is not about altering headline growth numbers for their own sake. It is about improving the underlying architecture of national accounts through updated supply use tables, better sectoral classification, and the incorporation of richer administrative data.

India now has access to a breadth of real-time administrative databases that simply did not exist a decade ago. Systems such as GST, e Vahan and the Public Financial Management System offer granular insights into production, trade and government spending. Integrating these into GDP compilation has the potential to improve both accuracy and timeliness, provided methodological safeguards and transparency are maintained. International comparability also matters. Aligning with updated guidance from bodies such as the United Nations Statistical Commission strengthens India’s standing in global economic analysis and investor assessments.

Inflation measurement is undergoing a parallel refresh. The revision of the CPI base year to 2024, drawing on the Household Consumption Expenditure Survey 2023 24, recognises that consumption baskets evolve as incomes rise and lifestyles change. The relative weight of food, services, housing and discretionary spending today differs substantially from a decade ago, across both rural and urban India. A CPI that reflects current spending patterns is essential for credible inflation targeting, wage negotiations and social protection design.

Equally important is the process behind the revision. The CPI update has been guided by an expert group with representation from the Reserve Bank, academia and multiple ministries, supported by consultations with international institutions. Such openness helps build trust, especially in a policy environment where inflation data directly influences interest rates and public expectations.

The rebasing of the Index of Industrial Production, often overshadowed by GDP and CPI debates, is no less consequential. IIP remains a key high frequency indicator of industrial momentum and feeds directly into manufacturing value added estimates. Updating its product basket, weights and factory coverage is necessary to reflect technological change, shifts in demand and the emergence of new manufacturing segments. Aligning the IIP base year with the national accounts also improves internal consistency across datasets.

Beyond headline indicators, some of the most meaningful reforms lie in improving measurement of sectors that have historically been undercounted. The informal and services sectors together account for a large share of output and employment, yet they are among the hardest to measure. The revamp of the Annual Survey of Unincorporated Sector Enterprises, coupled with the introduction of Quarterly Bulletins on Unincorporated Sector Enterprises, marks a shift towards more timely insights into this dynamic segment. Quarterly indicators on scale, composition and employment can help policymakers respond faster to emerging stresses or opportunities.

Similarly, the pilot and planned rollout of the Annual Survey of Service Sector Enterprises addresses a long-standing data gap in the incorporated services economy. Services now contribute roughly half of GDP, but detailed enterprise level data on productivity, capital formation and employment have been sparse. Regular, well- designed surveys in this space can materially improve understanding of growth drivers and bottlenecks.

Labour market statistics have also entered a new phase. The Periodic Labour Force Survey has evolved from an annual snapshot to a more responsive system delivering monthly national indicators and quarterly rural and urban estimates. Extending coverage to rural areas and selected states on a higher frequency basis enhances the ability to track employment trends in near real time. In a country where labour market shifts can be rapid and uneven, this granularity is critical for designing targeted interventions.

Perhaps the most transformative change is the move towards district level estimation as a core design feature of major surveys. Treating the district as a basic statistical unit recognises that development challenges and opportunities are often local. District level data can empower state and local governments to plan more effectively, align resources with needs, and monitor outcomes with greater precision.

Technology has been a key enabler of these reforms. The adoption of computer assisted personal interviewing through the e SIGMA platform, real time validation checks and faster release cycles has shortened the distance between data collection and public dissemination. Annual results released within months, quarterly results within weeks, and monthly indicators within days represent a step change in responsiveness.

Finally, improved data dissemination completes the reform loop. Platforms such as the GoIStats app, e-Sankhyiki portal and the revamped Microdata Portal signal a commitment to openness and reuse. Easy access to metadata, APIs and unit level datasets allows researchers, journalists and civil society to scrutinise, replicate and build upon official statistics, strengthening accountability and public trust.

Taken together, these reforms suggest a statistical system that is becoming more adaptive, transparent and policy relevant. The real test, however, will lie in sustained implementation, clear communication during transitions, and continued engagement with users of data. Counting what counts is not a one-time exercise. It is an ongoing commitment to ensure that India’s economic story is measured with rigour, honesty and relevance in a rapidly evolving landscape.

The writer is a policy analyst focusing on employment, demographics, and economic development. He writes on the intersections of workforce trends, technology, and industrial policy