Committee for Revising the Base Year for National Accounts

1. In July 2024, the Ministry of Statistics and Programme Implementation (MoSPI) has established a committee to oversee the revision of the base year for national accounts.
2. The committee consists of 26 members and is chaired by Biswantah Goldar.
3. It is tasked with recommending a new base year for national accounts, possibly aligning it with indices such as the Wholesale Price Index, Producer Price Index, and Consumer Price Index.

4. Current and Proposed Base Year:

1. The current base year for national accounts is 2011-12.
2. A proposal has been made to revise this base year to 2020-21.

5. Objective of the Revision:

1. The revision aims to improve the accuracy of economic analysis and policy formulation.
2. This will be achieved by reviewing existing databases and incorporating new data sources.

6. Historical Context:

1. In 2015, India revised the base year of the GDP series from 2004-05 to 2011-12.
2. This revision was in line with the United Nations System of National Accounts (SNA) 2008.
3. The SNA provides internationally agreed-upon recommendations on compiling measures of economic activity.

7. Need for Change:

1. Accuracy: Updating the base year for GDP calculation aligns with global practices, ensuring that economic data is captured more accurately.
2. Global Alignment: The GDP estimates based on 2011-12 did not accurately reflect the current economic scenario.
3. Frequency: Ideally, the base year should be updated every five years to reflect the evolving economy.