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India’s GDP Revisions Explained: Why Deflators Changed Growth Data
GDP measures how much value an economy creates.
Early quarterly estimates use clues such as crop production, cement output, steel use and vehicle sales.
Later, better information arrives from companies and government surveys, so the estimates can change.
India also changed the way it removes inflation from GDP calculations.
The new method adjusts the prices of inputs and outputs separately.
This is called double deflation.
It is intended to measure real growth more accurately when input and output prices move differently.
The new method uses Producer Price Index data, but some of that data is still being developed.
More details are expected in MoSPI’s forthcoming Sources and Methods document.
Quarterly GDP estimates are revised as more complete company, survey and production data becomes available.
The January-March 2026 GDP growth estimate was revised upward from 7.8% to 8.6%.
Older GDP data was revised after MoSPI shifted to double deflation using the Producer Price Index.
Double deflation uses separate price measures for sectoral inputs and outputs instead of one common deflator.
MoSPI says the new approach provides more than 300 deflators, although input PPI currently exists only for manufacturing.
- Who
- India’s Ministry of Statistics and Programme Implementation, along with economists analyzing the revisions.
- What
- Past GDP growth rates were revised because of additional data and a change to double deflation using Producer Price Index measures.
- Where
- India.
- When
- The revised GDP series was unveiled on February 27; the article discusses data through April-June 2026 and January-March 2026.
- Why
- Quarterly estimates are updated as better data becomes available, while the newer GDP series uses more sector-specific price indices to convert nominal values into real growth.
Key facts
- New GDP base year
- 2022-23, replacing 2011-12
- Q4 FY26 growth revision
- January-March 2026 growth was revised from 7.8% to 8.6%
- Estimation method
- Quarterly estimates use a benchmark-indicator approach
- New deflation method
- Double deflation adjusts inputs and outputs using separate price measures
- Main new price measure
- Producer Price Index, which measures prices received by producers at the factory gate
- Number of deflators
- More than 300 under the new approach, compared with around 180 under the old series
- Current limitation
- Input PPI is still at a trial stage and currently exists only for manufacturing
Quotes
ICICI Securities Primary Dealership economists
Economists quoted from an ICICI Securities Primary Dealership note
“pipeline price pressures are strong”
indianexpress.com
Sources
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