The Ministry of Statistics and Programme Implementation (MoSPI) has introduced a new GDP series with 2022–23 as the base year, replacing the earlier 2011–12 base year. The revision of the base year is a routine statistical exercise carried out periodically to reflect structural changes in the economy, incorporate new data sources, and improve estimation methodology. The last major revision was undertaken in 2015, when the base year was shifted to 2011–12.
Under the new series, India’s GDP growth for October–December 2025 (Q3 FY26) has been estimated at 7.8%, while full-year growth for FY26 is projected at 7.6% as per the second advance estimates. This is higher than the earlier estimate of 7.4% for FY26 under the old series.
Revisions in Growth Rates
The revised series has led to significant changes in past growth figures. Growth for FY23–24 has been revised downward to 7.2% from 9.2% under the previous series. In contrast, FY24–25 growth has been revised upward to 7.1% from 6.5%. Growth for FY25–26 is estimated at 7.6%.
Quarterly revisions for FY26 show Q1 growth at 6.7%, Q2 at 8.4%, and Q3 at 7.8%. These revisions reflect updated methodology and improved data coverage. MoSPI has announced that a full back series, recalculated historical GDP data under the new base year, will be released by December 2026.
Methodological Improvements
A key methodological shift in the new series is the move from the “single-deflator” method to the “double-deflation” method for calculating real Gross Value Added (GVA). Previously, a single price deflator was used to adjust nominal values to real terms across most sectors, which could overstate growth when input and output prices moved differently.
Under double deflation, both inputs and outputs are adjusted separately using their respective inflation rates. This approach provides a more accurate measure of real economic growth and aligns India’s national accounts with international best practices.
The new series also incorporates additional data sources, including GST data, e-Vahan vehicle registration data, the Annual Survey of Unincorporated Sector Enterprises, and the Periodic Labour Force Survey. Furthermore, national accounts have been integrated with Supply and Use Tables to reduce discrepancies between production-based and expenditure-based GDP estimates.
Sectoral Growth Trends in FY26
The secondary sector is projected to grow at 9.5% in FY26, up from 7.3% in FY25. Manufacturing growth is estimated at 12.5%, compared to 8.3% in the previous year, while construction is expected to expand by 6.9%, slightly lower than 7.1% in FY25.
The primary sector is expected to moderate to 2.8% growth in FY26, down from 5% in FY25. Agriculture growth is estimated at 2.5%, compared to 4.3% earlier, while mining and quarrying is projected to grow at 5%, significantly lower than 11.2% in the previous year.
The tertiary (services) sector is forecast to grow at 8.9%, up from 8.3% in FY25. Trade, hotels, transport, and communication are projected to expand by 10.3%, while financial, real estate, IT, and professional services are expected to grow at 10%. This reflects strong momentum in manufacturing and services, offset by moderation in agriculture.
Downward Revision in Nominal GDP
Despite an upward revision in real growth, the nominal size of the economy has been revised downward. India’s nominal GDP for FY26 is now estimated at Rs. 345.47 lakh crore, around 3.3% lower than earlier estimates under the old series. The size of the economy for FY24 and FY25 has also been revised downward by about 3.8% each.
Nominal GDP represents the current-price value of the economy and serves as the base for calculating key fiscal ratios.
Impact on Fiscal Ratios
Since fiscal indicators such as fiscal deficit-to-GDP and debt-to-GDP ratios are expressed as a percentage of nominal GDP, a lower GDP base mechanically increases these ratios. The fiscal deficit for FY26 is now estimated at 4.51% of GDP, compared to 4.36% earlier, even though the absolute deficit amount remains unchanged.
Similarly, the debt-to-GDP ratio for FY27 is projected at 57.5%, up from the earlier target of 55.6%. This revision makes the government’s debt consolidation path toward its FY2031 goal of reducing debt to 50% of GDP more challenging.