RAS question
Consider the following statements regarding the new GDP base year series implemented by MoSPI in 2026: 1. The new National Accounts series uses 2022-23 as the base year replacing the earlier 2011-12 base year. 2. Under the new base year India real GDP growth for FY 2025-26 is estimated at 7.4 per cent. Which of the statements given above is/are correct?
Correct answer: (C) 1 only.
MoSPI's new National Accounts series uses 2022-23 as the GDP base year in place of 2011-12, while real GDP growth for FY 2025-26 is estimated at 7.6%, not 7.4%.
Explanation
Statement 1 is correct because the PIB release from the Ministry of Statistics and Programme Implementation says the new series of annual and quarterly National Accounts estimates uses 2022-23 as the base year and replaces the previous 2011-12 series. A base-year revision is not a routine annual update; it changes the statistical frame, data sources and methods so that GDP better reflects the economy being measured. The release also states that, under the new series, real GDP or GDP at constant prices is estimated at Rs 322.58 lakh crore in FY 2025-26, with real GDP growth of 7.6% against 7.1% in 2024-25. Therefore, Statement 2 is wrong: 7.4% was the old-series projection, not the new-series estimate.
Why the other options are wrong
- (A) Option A accepts only Statement 2, but the new-series FY 2025-26 real GDP growth estimate is 7.6%, so the 7.4% figure cannot be treated as correct.
- (B) Option B is wrong because Statement 1 is supported by the PIB release, but Statement 2 misstates the new-series real GDP growth estimate.
- (D) Option D rejects both statements, although the PIB release expressly says the 2022-23 base year replaces the earlier 2011-12 National Accounts series.
Concept
This tests national income accounting, especially why GDP base-year revisions matter for comparing real growth over time. RAS repeatedly asks this because base-year changes alter headline macroeconomic estimates and are central to interpreting official economic data.