MUMBAI: The new base year revision of key economic indicators such as the GDP, IIP and inflation will help the Reserve Bank achieve its twin objectives of price stability and sustained economic growth, Governor Sanjay Malhotra has said.
The National Statistical Office (NSO) under the ministry of statistics and programme implementation is revising the base year of the key marco indicators like the GDP, index of industrial production or IIP and inflation, after more than a decade.
The new consumer price index or CPI series with 2024 as the base year will be released on February 12, followed by the new GDP series with 2022–23 as the base year on February 27. The revised IIP series with base year of 2023 is expected by end-May.
Calling the government move to revise the base years a “timely and welcome step,” Malhotra in a podcast said strengthening the statistical systems will allow for more calibrated policymaking and improve assessments of inflation and real economic momentum as the changes it will help reflect economic changes and support better-calibrated monetary policy.
"This exercise is not merely a revision in the base years, but it also covers revisions in methods, weights, item baskets, data sources and computation techniques," the Governor said.
For the RBI, he said, CPI is especially important for monetary policy purposes because it anchors the flexible inflation-targeting framework.
"Updating the base year of CPI will ensure that the index reflects the consumption patterns and household spending more accurately as they have obviously changed over a period of time," Malhotra said in the podcast.
Similarly, GDP figures are very important. "The GDP needs to capture the evolving structure of the economy, which has again transformed and changed, with the rising role of services, digital activities, and various new business models," he said.
The IIP base revision, he said, will also help policymakers better assess underlying industrial momentum, structural shifts within manufacturing, and emerging sectors that are not adequately represented in older base years.
"Overall, I would like to congratulate the ministry. It is a very timely and a very welcome step. Strengthening our statistical systems, it will facilitate more calibrated policies. It will help us sustain both price stability and economic growth. I wish all the very best to the ministry and all the stakeholders in this endeavor. This exercise transcends the change in the base year and also involves a change in methods, weights, baskets of items, sources, and compilation practices,” the video message concluded.
According to ministry, the new GDP series with base year 2022-23 will be released on February 27, 2026. The new CPI series with base year 2024 will be released on February 12, 2026 and the new IIP series with base year 2022-23 will be released on May 28, 2026.
The International Monetary Fund (IMF) had, in late 2025, graded India at 'C' on national accounts, essentially citing outdated data. The base year was perceived to be outdated by the IMF.
The government is undertaking a revision of the base year for national accounts to better reflect structural changes in the economy, evolving consumption patterns, and the rapid expansion of the digital economy over the past decade, Saurabh Garg, secretary in the ministry of statistics and programme implementation had said earlier.
"Over the past 10 years, the structure of the economy has changed. The type of products that are consumed has changed, and the digital economy has grown much bigger," Garg had said.
The base year is revised periodically to better capture the structural changes happening in the economy by updating the methodology of compilation and incorporation of new data sources.