ExplainSpeaking: What Subhash Garg gets wrong about India’s GDP growth rate

In August, India's Ministry of Statistics and Programme Implementation (MoSPI) unveiled the country's first-quarter economic output data for 2025. Despite the backdrop of the US-Iran war, many analysts had anticipated slower growth due to India's heavy reliance on imports from the West for its energy needs. However, sector data demonstrated faster-than-expected economic growth.

By June, economists expected a 7.5% growth rate, with some expecting 7.8%. The previous paragraph explained why this growth may be better than anticipated but cautioned against concluding India is in a "Goldilocks" phase. The official data revealed India's GDP grew 7.8% in real terms and 10.3% nominally. MoSPI revised GDP data in February, changing the base year from 2011-12 to 2022-23, as base year revisions are typically done every five years.

This revision significantly impacted nominal GDP, reducing it from Rs 357 trillion to Rs 345 trillion. Former Finance Secretary S.C. Garg claimed the government intentionally revised down Q1 2025 GDP to show a better growth rate for Q1 2026. However, this claim is incorrect, as the government revised Q1 2025 GDP down before the US-Iran war broke out, and the 2.6% growth rate calculation by Garg uses data from different base year series, making it invalid.