MoSPI proposes changes to GDP, CPI base years, consults economists

New Delhi: Officials from the ministry of statistics and programme implementation (MoSPI) met economists in Mumbai on Tuesday to seek their feedback and suggestions on making growth and inflation data more robust and effective.

This interaction was an opportunity for MoSPI to share with the stakeholders the proposed improvements which are expected to be incorporated during a base revision exercise for both the indices, the ministry said in a statement on Tuesday.

This meeting will contribute towards an exchange of views and insights and sharing of expertise on Gross Domestic Product (GDP) and Consumer Price Index (CPI) among the stakeholders, it added.

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Finance ministry officials including the secretary of the department of economic affairs and the chief economic advisor, as well as members of the prime minister's economic advisory committee (PM-EAC) will also be a part of the consultation, a government press release said.

Base revision is the process of changing the base year for calculating GDP and CPI. Bringing the base year forward to a more recent time period is thought to increase the accuracy of indices. 

India's last base year revision for GDP took place in 2015, when it was moved from 2004-05 to 2011-12.

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In the same year, the government updated the base year for CPI from 2010 to 2012 to reflect changes in consumption patterns more effectively. A key reason for the coming base year revision may be the economic changes caused by the covid-19 pandemic, which put the brakes on economic growth, altered consumption patterns and hindered accurate data collection.

Household consumption expenditure data

MoSPI's consultations follow the release of the household consumption expenditure data for the period between August 2022 and July 2023, which indicated a reduction in poverty, a shift in expenditure from food to non-food items such as education and medical services, and a rise in monthly per capita consumption.