NEW DELHI: India’s reported 7.8% economic expansion has come under fresh scrutiny after a substantial revision to previous-year GDP data raised questions over whether the latest figure accurately reflects the strength of the Indian economy.
The controversy centres on a substantial downward revision to the GDP figure for the same quarter a year earlier. Former finance secretary Subhash Chandra Garg argues that the change has made the latest year-on-year growth rate appear stronger, while the government insists the figures reflect a new statistical methodology rather than manipulation.
The dispute has broader significance for investors, policymakers and international institutions assessing India’s economic performance, particularly as questions persist over the quality, methodology and transparency of the country’s economic statistics.
Garg, who served as India’s finance secretary from 2017 to 2019, said the government had reduced the GDP estimate for April-June 2025 by about 6 trillion rupees ($63.5 billion) to 80 trillion rupees in the latest data.
He argued that the revision made the latest quarter’s GDP of 88.27 trillion rupees look more favourable in year-on-year comparisons.
The claim has triggered a wider debate over the reliability of India’s GDP data and economic growth figures, with opposition politicians also questioning recent revisions.
Government defends GDP data
India’s Chief Economic Adviser V Anantha Nageswaran rejected the suggestion that the revisions amounted to selective manipulation, saying the latest figures were calculated using a new statistical framework with 2022-23 as the base year.
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He said changes in methodology naturally lead to some quarterly figures being revised upwards and others downwards, urging critics to focus on consistency rather than individual revisions.
Commerce Minister Piyush Goyal has also defended the headline figure, saying India’s 7.8% economic growth is a reality.
Garg, however, maintained that the methodological change does not adequately explain what he described as the “missing GDP” from the previous year.
The controversy comes after the International Monetary Fund raised concerns last year about the quality of India’s economic statistics, particularly its outdated base year and methods used to estimate price changes.
Growth Sustainability Question
Economists remain divided over the scale of the latest India GDP growth.
Standard Chartered’s Anubhuti Sahay said the improved methodology contributed to stronger first-quarter figures but argued that the growth should not be dismissed as artificial.
She pointed to resilient economic indicators, while highlighting concerns over job creation and rural activity.
Meanwhile, Morgan Stanley and Citi have forecast India’s annual growth at 7.3% for the year ending March 2027.
The June-quarter expansion was supported by stronger investment and exports, although economists warned that geopolitical risks and global economic uncertainty could make the pace difficult to sustain.
