{"id":91105,"date":"2026-03-05T12:43:09","date_gmt":"2026-03-05T07:13:09","guid":{"rendered":"https:\/\/vajiramandravi.com\/current-affairs\/?p=91105"},"modified":"2026-03-05T12:43:09","modified_gmt":"2026-03-05T07:13:09","slug":"new-gdp-series-stronger-agriculture-and-informal-manufacturing","status":"publish","type":"post","link":"https:\/\/vajiramandravi.com\/current-affairs\/new-gdp-series-stronger-agriculture-and-informal-manufacturing\/","title":{"rendered":"New GDP Series: Stronger Agriculture and Informal Manufacturing Revealed"},"content":{"rendered":"<h2><b>New GDP Series Latest News<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">India\u2019s new GDP series, with <\/span><b>2022\u201323 as the base year<\/b><span style=\"font-weight: 400;\">, has introduced notable changes in the assessment of economic performance.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The revised data shows more stable real GDP growth rates for the years beginning 2023\u201324, ranging between 7.1% and 7.6%, compared to the earlier wider range of 6.5% to 9.2%.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The updated series also indicates a <\/span><b>3\u20134% reduction<\/b><span style=\"font-weight: 400;\"> in the overall size of the economy in nominal terms (<\/span><b>Nominal GDP<\/b><span style=\"font-weight: 400;\"> \u2192 Uses current market prices).\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, the revision is considered reasonable and reflects a more accurate measurement of economic activity.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Importantly, the new GDP series offers a clearer picture of how different sectors of the economy are performing.<\/span><\/li>\n<\/ul>\n<h2><b>Agriculture Sector Larger in the New GDP Series<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The new GDP series released by the Ministry of Statistics and Programme Implementation (MoSPI) shows that the agriculture, livestock, forestry and fishing sector is about 5% larger than previously estimated for the years starting 2022\u201323 in nominal terms.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Since the overall size of the economy has been revised downward by 3\u20134%, agriculture\u2019s share in GDP has increased.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The sector\u2019s share rose to 18.2% in 2022\u201323, compared with 16.5% in the earlier GDP series.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Despite the revision, agriculture\u2019s share in the economy continues to decline over time. In 2025\u201326, agriculture accounts for <\/span><b>16.2% of GDP<\/b><span style=\"font-weight: 400;\"> in the new series, compared with <\/span><span style=\"font-weight: 400;\">15.2% in the old series<\/span><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n<h2><b>Reasons for the Higher Estimate<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Inclusion of More Cash Crops<\/b><span style=\"font-weight: 400;\"> &#8211; The new GDP series better captures the shift toward cash crops such as fruits and vegetables. These crops generate higher profits for farmers, increasing the value added in agriculture and raising the sector\u2019s estimated size.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><b>Reduced Input Costs for Farmers<\/b><span style=\"font-weight: 400;\"> &#8211; The new estimates also reflect a decline in fuel costs in agriculture. Diesel use has reduced and is increasingly being replaced by electricity and solar power for irrigation. Lower input costs increase the value added generated by farmers.<\/span><\/li>\n<\/ul>\n<h3><b>Role of the PM-KUSUM Scheme<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">A major factor behind this shift is the <\/span><strong><a href=\"https:\/\/vajiramandravi.com\/current-affairs\/pm-kusum-pradhan-mantri-kisan-urja-suraksha-evam-utthaan-mahabhiyan-scheme\/\" target=\"_blank\">Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyaan (PM-KUSUM)<\/a><\/strong><span style=\"font-weight: 400;\"> scheme launched in 2019.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The scheme provides subsidies for installing solar irrigation pumps, helping farmers reduce dependence on diesel and lower energy costs.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This transition contributes to higher value added in the agricultural sector.<\/span><\/li>\n<\/ul>\n<h2><b>Stronger Manufacturing Growth in the New GDP Series<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The new GDP series shows that the manufacturing sector has become a stronger driver of economic growth.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Under the old GDP series, manufacturing grew at an average rate of about 8% between 2023\u201324 and 2025\u201326, with a sharp 12.3% growth in 2023\u201324 largely due to a favourable base effect.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">In contrast, the new GDP series estimates manufacturing growth at an average of 11.2% annually during the same period, indicating a stronger and more consistent expansion of the sector.<\/span><\/li>\n<\/ul>\n<h3><b>Methodological Improvements in Estimation<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">One important reason for the higher growth estimate is the <\/span><b>abandonment of the single-deflator method<\/b><span style=\"font-weight: 400;\">, which was widely criticised for inaccurately converting nominal Gross Value Added (GVA) into real terms.\u00a0<\/span>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">The single-deflator method is\u00a0an economic technique used to calculate real Value Added (or GDP) by deflating nominal value added directly with a single price index, typically the output price index\u00a0(e.g., WPI or CPI).\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"2\"><span style=\"font-weight: 400;\">It assumes input and output prices move similarly, often leading to overestimation when they diverge.<\/span><\/li>\n<\/ul>\n<\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The revised methodology provides a more accurate estimate of manufacturing output.<\/span><\/li>\n<\/ul>\n<h3><b>Better Data on the Informal Sector<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Improved data sources have also contributed to the revised estimates.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Surveys such as the Annual Survey of Unincorporated Sector Enterprises (ASUSE) and the Periodic Labour Force Survey (PLFS) now capture more information about the informal manufacturing sector.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">This improved data coverage has helped economists estimate stronger and more consistent manufacturing growth in the new GDP series.<\/span><\/li>\n<\/ul>\n<h2><b>Informal Economy in the New GDP Series<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">One major criticism of India\u2019s earlier GDP estimates was the inaccurate measurement of the informal sector.\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The new GDP series attempts to correct this by using data from the Periodic Labour Force Survey (PLFS) and the Annual Survey of Unincorporated Sector Enterprises (ASUSE).<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">These surveys reduce the earlier dependence on formal-sector proxies and provide a more realistic picture of informal economic activity.<\/span><\/li>\n<\/ul>\n<h2><b>Impact on Different Sectors<\/b><\/h2>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The improved measurement of the informal economy has contributed to stronger estimates of manufacturing growth, as informal manufacturing activities are now better captured in the data.<\/span><\/li>\n<\/ul>\n<h3><b>Decline in Estimated Size of Some Service Activities<\/b><\/h3>\n<ul>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">However, data for some service-sector activities suggest that the size of the unorganised sector may have been overestimated earlier.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">For example, the sector comprising trade, repair, hotels and restaurants, transport, storage, communication, and broadcasting-related services has seen its Gross Value Added (GVA) fall by nearly 25% annually between 2022\u201323 and 2025\u201326 in the revised estimates.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">According to officials, this sector has a large informal component, and better data has led to more accurate and possibly lower estimates of its size.<\/span><\/li>\n<\/ul>\n<p><b>Source:<\/b> <strong><a href=\"https:\/\/indianexpress.com\/article\/explained\/explained-economics\/farm-informal-economy-manufacturing-india-new-gdp-series-10561190\/\" target=\"_blank\" rel=\"nofollow noopener\">IE<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>India\u2019s New GDP Series with 2022\u201323 as the base year shows a larger agriculture sector, stronger manufacturing growth, and improved measurement of the informal economy using new data sources.<\/p>\n","protected":false},"author":18,"featured_media":57508,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[18],"tags":[60,1912,22,59],"class_list":{"0":"post-91105","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-upsc-mains-current-affairs","8":"tag-mains-articles","9":"tag-new-gdp-series","10":"tag-upsc-current-affairs","11":"tag-upsc-mains-current-affairs","12":"no-featured-image-padding"},"acf":[],"_links":{"self":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/91105","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/comments?post=91105"}],"version-history":[{"count":4,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/91105\/revisions"}],"predecessor-version":[{"id":91122,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/posts\/91105\/revisions\/91122"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media\/57508"}],"wp:attachment":[{"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/media?parent=91105"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/categories?post=91105"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/vajiramandravi.com\/current-affairs\/wp-json\/wp\/v2\/tags?post=91105"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}