- Gross Domestic Product (GDP) is the market value of all final goods and services produced within a country's borders in a year.
- India's national accounts are compiled by the National Statistics Office (NSO) under MoSPI, formed in 2019 by merging the CSO and NSSO.
- The GDP base year moved from 2011-12 to 2022-23 with the new series released on February 27, 2026.
Key Aggregates
- GNP = GDP + net factor income from abroad.
- NNP = GNP − depreciation (consumption of fixed capital).
- National income = NNP at factor cost.
- GVA at basic prices = GDP − product taxes + product subsidies. GVA shows sector-wise output.
- Nominal GDP uses current prices; real GDP uses base-year prices to remove inflation.
- Per capita income = national income ÷ population.
Methods of Measurement
| Method | Adds up |
|---|---|
| Production (value added) | Value added by each sector — avoids double counting of intermediate goods |
| Income | Wages + rent + interest + profits (+ mixed income) |
| Expenditure | C + I + G + (X − M) |
History of Estimates
Dadabhai Naoroji made the first estimate (for 1867-68) in Poverty and Un-British Rule in India; V.K.R.V. Rao made the first scientific estimate (1931); the National Income Committee (1949) was chaired by P.C. Mahalanobis.
GDP base year2022-23
New seriesFeb 27, 2026
Compiled byNSO (MoSPI)
WPI byOffice of Economic Adviser
RBI targetsCPI inflation
HDI byUNDP
Inflation Indices
| Index | Published by | Note |
|---|---|---|
| Wholesale Price Index (WPI) | Office of the Economic Adviser, DPIIT | No services; tracks producer-level prices |
| Consumer Price Index (CPI) | NSO, MoSPI | Headline measure targeted by RBI since the Urjit Patel Committee (2014) |
| CPI for Industrial Workers | Labour Bureau | Used to set dearness allowance |
Types of Inflation
- Demand-pull — too much money chasing too few goods.
- Cost-push — rising input costs such as wages or fuel.
- Stagflation — high inflation with stagnant growth and high unemployment.
- Disinflation — inflation falling but still positive; deflation — prices actually falling.
- Headline vs core — core inflation excludes volatile food and fuel.
Development Indices
- Human Development Index — published by UNDP since 1990 (Mahbub ul Haq, with Amartya Sen); covers health, education and standard of living. India ranked 130th of 193 in the 2025 report.
- Multidimensional Poverty Index — NITI Aayog estimated that 24.82 crore people moved out of multidimensional poverty between 2013-14 and 2022-23.
- Key curves: Phillips (inflation vs unemployment), Laffer (tax rate vs revenue), Kuznets (growth vs inequality).
Q1. GNP is equal to GDP plus:
✅ Answer: (b) Net factor income from abroad
💡 Explanation: GNP adds income earned by residents abroad and subtracts income earned by foreigners in India.
Q2. What is the base year of India's current GDP series?
✅ Answer: (c) 2022-23
💡 Explanation: The new series released on February 27, 2026 uses 2022-23 as the base year.
Q3. Which organisation publishes the Wholesale Price Index in India?
✅ Answer: (a) Office of the Economic Adviser, DPIIT
💡 Explanation: WPI is compiled by the Office of the Economic Adviser in the Department for Promotion of Industry and Internal Trade.
Q4. A situation of high inflation combined with high unemployment and slow growth is called:
✅ Answer: (d) Stagflation
💡 Explanation: Stagflation combines stagnation with inflation.
Q5. Who prepared the first estimate of India's national income?
✅ Answer: (c) Dadabhai Naoroji
💡 Explanation: Dadabhai Naoroji estimated national income for 1867-68; V.K.R.V. Rao made the first scientific estimate in 1931.
🔁 Revise in 60 Seconds
- GNP = GDP + NFIA; NNP = GNP − depreciation; NI = NNP at factor cost.
- GDP base year 2022-23 (series of Feb 27, 2026), replacing 2011-12.
- WPI → Office of the Economic Adviser; CPI → NSO; CPI-IW → Labour Bureau.
- HDI → UNDP (since 1990); India 130th in 2025.
📌 Prelims Traps to Avoid
- ✘ RBI targets CPI, not WPI.
- ✘ Disinflation is a slowdown in inflation, not falling prices.
- ✘ National income is NNP at factor cost, not market prices.
What is the difference between GDP and GNP?
GDP measures output produced within India's borders. GNP adds net factor income from abroad, i.e. income earned by Indian residents abroad minus income earned by foreigners in India.
What is the current base year for GDP in India?
The base year is 2022-23. MoSPI released the new series on February 27, 2026, replacing the 2011-12 base.