New GDP series: How revisions in FY2011-12 rewrote high-growth years

After a prolonged wait, the statistics ministry is slated to release a new gross domestic product (GDP) series on Friday, with 2022-23 as the base year. Base revisions are technical exercises, but history shows they can significantly reshape the narrative around India’s growth performance. 

Under the 2004-05 series, India recorded three consecutive years of 9 per cent-plus growth — 9.3 per cent in 2005-06 (FY06), 9.3 per cent in FY07, and 9.8 per cent in FY08 — all falling under the Manmohan Singh government 1.0. That three-year run remains unprecedented in India’s economic history. No other period has seen such sustained near-double-digit expansion. The momentum culminated in 10.3 per cent growth in FY11 under the Singh government 2.0, marking the second time when India crossed the double-digit mark. For the first time the country achieved the feat by recording 10.2 per cent growth in FY89 under 1999-00 series. FY22’s 9.7 per cent print came closer, which was largely a rebound from the pandemic-induced contraction of FY21. 

But when the 2011-12 base series was introduced, those headline numbers were revised downward for overlapping years. The three-year 9 per cent streak was recalibrated to 7.9 per cent, 8.1 per cent, and 7.7 per cent, respectively. The 10.3 per cent figure for FY11 was scaled back to 8.5 per cent. While still robust, the image of an economy flirting with double digits was moderated. 

One can point the finger by accusing the statistics office of undermining the growth period of the Singh government, but the new series (2011-12) also lifted the GDP growth on the older base (2004-05) of policy paralysis years of the same government — FY13 and FY14. The size of the economy was also adjusted. For FY08, GDP was estimated at ₹49.9 trillion under the 2004-05 base, compared with ₹49 trillion under the 2011-12 series. By FY14, the old series showed ₹113.5 trillion while the revised one placed it at ₹112.3 trillion. In dollar terms, FY11 GDP was pegged at $1.71 trillion under the 2004-05 base, and $1.68 trillion under the 2011-12 series. 

The changes stemmed from a substantial methodological overhaul. The 2004-05 series calculated GDP growth at factor cost by summing sectoral output. The 2011-12 series shifted to GDP at market prices. Factor cost excludes indirect taxes, whereas market price includes them. 

Data sources also changed materially. The 2004-05 series relied heavily on the Index of Industrial Production (IIP) and the Annual Survey of Industries (ASI) for industrial output. The 2011-12 series expanded coverage by using corporate filings from the MCA-21 database and stock exchange disclosures, significantly widening the sample base, especially in manufacturing and services.