7.8% or 2.6%? What Is India’s GDP Really Saying?

31st August was the start of this controversy, where the government celebrated 7.8% real GDP growth in Q1 FY2026-27. The method of calculating it itself was a bit unique this time, where 2022-2023 base years were employed, which adjusted the output and input prices.

The 2.6% estimate emerged relatively after. Former finance secretary Subhash Chandra Garg calculated that growth could be closer to 2.6% when comparing the old series with the revised numbers. His argument suggested how last year's economic output was revised downwards, to make it look like the GDP has grown this financial year.

The real difference between 7.8% and 2.6% is between the methodologies of making a relative comparison. Where the government compared Q1 FY2026–27 GDP with Q1 FY2025–26 GDP using the new GDP series and methodology. This is the official year-on-year growth rate.

On the other hand, other scholars compare the newly revised current GDP data with older GDP estimates from the previous series. Because the historical data has been revised, this creates a much lower growth figure. Therefore the difference is the base being used for the comparison.

The major problem with the 7.8% calculation is that the government has revised the GDP estimates for previous years, changing the base against which current growth is measured. If the previous year’s GDP is revised downward, the current year’s growth rate can appear higher.

Similarly, the 2.6% figure comes from the old GDP series calculation. The problem with this is the 2 series could be estimated by employing varying base amounts. The 2.6% figure is useful because it highlights how much the revisions can affect the apparent growth rate, but it should not automatically be treated as India’s “true” GDP growth

To conclude with the 7.8% real gdp growth rate should be taken as a valid one, as the government has significant methodological defence to it.

Additionally, the new 2022-23 GDP series which aligns towards double deflation. We can also say the 7.8% figure is calculated using a methodology that is broadly aligned with international statistical practices. (UNSD and Ministry of Statistics India)