New GDP series to lean on digital data, move away from commodity-flow method

New GDP series to move away from commodity flow approach

India’s upcoming gross domestic product (GDP) series will rely far more heavily on digital and administrative data and updated survey-based methodologies, marking a significant shift away from older estimation techniques such as the commodity-flow approach. The changes are aimed at better capturing structural shifts in a rapidly digitising economy.

A discussion paper released by the Ministry of Statistics and Programme Implementation (MoSPI) outlines how the revised national accounts series will draw on datasets such as e-Vahan, alongside newer household and enterprise surveys, to improve the accuracy of GDP estimation.

Key surveys—including the Household Consumption Expenditure Survey (HCES) for 2022–23 and 2023–24, as well as updated surveys of both formal and informal enterprises—will form the backbone of the new GDP base year. These are expected to offer more granular insights into consumption behaviour and production activity than earlier benchmarks.

One of the most significant methodological changes flagged in the paper is a move away from the commodity-flow method for estimating consumption across most items. Under the earlier framework, fixed ratios derived from a 2011–12 study were used to allocate commodities between intermediate consumption, final consumption and other uses.

The revised system will instead use dynamic rates and ratios, allowing estimates to evolve over time as consumption patterns change. In several cases, the commodity-flow approach will be abandoned entirely, reflecting the growing mismatch between static allocation ratios and today’s more complex consumption structure.

The paper provides examples of how multiple datasets will be combined to generate more accurate sectoral estimates. For road transport services and personal vehicle use, MoSPI plans to integrate e-Vahan registration data with findings from studies on public transport operations and household vehicle repair and maintenance. This blended approach is intended to better capture both commercial and personal transport activity, which earlier methods often struggled to distinguish.

The new series will also adopt the COICOP 2018 (Classification of Individual Consumption According to Purpose) framework, which offers a more refined classification of consumption expenditure, bringing India’s national accounts closer to international best practices.

In addition, MoSPI plans to revise assumptions on the lifespan of fixed assets to improve estimates of consumption of fixed capital, a key proxy for measuring investment in the economy.

MoSPI plans to release the new GDP series on February 27, 2026, and has indicated that back-series data will be made available within a year of the launch, allowing analysts and policymakers to compare economic performance across time using the revised methodology.