India’s GDP reset to reflect seasonality, expanded coverage: Saurabh Garg
“Industrial activities in India are affected by seasonal factors such as monsoons, festivals and year-end spending. Unless proper adjustments are made, quarterly growth may reflect temporary spikes rather than underlying economic momentum,” Garg said in an interview to TOI.
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“A seasonally adjusted series allows for better quarter-to-quarter comparability, clearer identification of cyclical turning points and reduction of short-term volatility.” He noted that creating these estimates requires at least five years of historical data and can be revised with annual comparisons.
The government plans to release seasonally adjusted quarterly GDP estimates following the back series, which will be followed by annual series adjustments.
The overhaul is part of the government’s broader reset, in which economic data is being revised to include updated benchmarks and statistics to improve accuracy and make the data more comprehensive.
This comes after the International Monetary Fund (IMF) in November 2025 outlined methodological weaknesses in India’s national accounts statistics and gave it a ‘C’ grade; This reflects that the data provided to the fund has some shortcomings that somewhat hinder oversight. Garg said the updates to the new CPI series have been widely welcomed by the RBI, academics and businesses.
“The basket has expanded from 299 items to 358 items, with improvements such as the inclusion of rural house rents, better service representation and the integration of administrative data for fuel and fares. While header back-series data and linkage factors are available, the adoption of the COICO framework makes direct item-level comparisons technically complex,” he added.
Addressing concerns over the reliability of national accounts and employment data, Garg said: “Over the past two to three years, several reforms have been undertaken to strengthen the quality, transparency and reliability of official data. We are also revising the base years for key macroeconomic indicators and have issued a pre-publication schedule for the upcoming fiscal to ensure timeliness.”
On employment statistics, Garg defended the Periodic Labor Force Survey (PLFS). “The PLFS broadly follows the internationally accepted 13th ICLS recommendations for measuring labor force participation, employment and unemployment. Differences in perception are often due to how employment is defined, not to weaknesses in survey methodology,” he said.
The new GDP series will also bring many technical improvements.
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“Unlike the indicator-based forecast used in the current series, it will provide better coverage of household and unorganized sectors through unincorporated sector survey and PLFS. Administrative data from sources like GST, Vahan, PFMS and oil and gas sector will also be integrated. Value addition for multi-activity businesses will be more accurately allocated to different business activities and LLPs will now be covered comprehensively,” Garg said.
“In addition, the revised series will eliminate the single deflator for manufacturing and agriculture, apply double deflator where possible, and apply a single deflator or volume extrapolation for the services sector where needed.”
