GDP debate: Centre rebuffs criticism of methods, says 7.8% growth correct

Amidst a heated debate surrounding India's GDP data, the Ministry of Statistics and Programme Implementation (MoSPI) released a six-point rebuttal on Wednesday, asserting the accuracy of its methods and the numbers shared on Monday. The initial report indicated that India's GDP expanded by 7.8% in the April-June quarter, outpacing most economists' expectations and surpassing the Reserve Bank of India's forecast of 7%.

Moreover, past data, including figures for the January-March quarter, were revised upwards from 7.8% to 8.6%, attributed to the adoption of new output Producer Price Index (PPI), updated Index of Industrial Production (IIP) data series, and the recently released Banking Services Price Index.

The controversy, however, did not deter prominent figures such as former finance secretary Subhash Chandra Garg, who criticized the data, stating that nominal GDP growth should have been 2.6% in real terms and that the revised number was manipulated to make growth appear more favorable. MoSPI responded to Garg's claims without directly naming him, refuting his assertion that April-June 2025's nominal GDP had been artificially reduced from Rs 86 lakh crore to Rs 80 lakh crore to enhance growth prospects for April-June 2026.

The ministry clarified that the earlier Rs 86.05 lakh crore figure was based on the old GDP series with 2011-12 as the base year, while the updated series, employing 2022-23 as the base year, was introduced in February and incorporated new data sources and methodological adjustments, as recommended by international agencies. Consequently, India's GDP without adjusting for inflation was initially estimated at Rs 80.32 lakh crore in April-June 2025, which was later revised to Rs 80.44 lakh crore in June. This adjustment reflects the availability and update of indicators and data, as per MoSPI.

The ministry emphasized that comparing GDP numbers from different series is not a valid method to determine growth rates. With the latest data indicating that India's GDP without inflation adjustment was Rs 88.27 lakh crore in April-June, the nominal GDP growth rate amounts to 10.3% when compared to the year-ago figure of Rs 80.00 lakh crore. Former Chief Economic Advisor Kaushik Basu echoed Garg's concerns on social media, questioning the authenticity of the presented data.