{"id":241592,"date":"2023-05-09T20:28:56","date_gmt":"2023-05-09T14:58:56","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=241592"},"modified":"2023-05-09T20:28:56","modified_gmt":"2023-05-09T14:58:56","slug":"unravelling-the-complexities-of-indias-2011-12-gdp-series-is-key","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/unravelling-the-complexities-of-indias-2011-12-gdp-series-is-key\/","title":{"rendered":"Unravelling the complexities of India\u2019s 2011-12 GDP series is key"},"content":{"rendered":"\n

Source-<\/strong> The post is based on the article \u201cUnravelling the complexities of India\u2019s 2011-12 GDP series is key\u201d published in \u201cmint\u201d on 9th May 2023.<\/p>\n

Syllabus: <\/strong>GS3- Indian economy and growth<\/p>\n

News <\/strong>– The article explains the changes incorporated in 2011-12 series to calculate the GDP.<\/p>\n

What are numerous conceptual and statistical changes, incorporated in the 2011-12 series?<\/strong><\/h2>\n

It was aimed at aligning the series with recommendations of the System of National Accounts <\/strong>(SNA) 2008.<\/p>\n

Traditionally, in India, GDP referred to GDP at factor cost<\/strong>. Gross Value Added at Basic Prices<\/strong> was introduced as a new aggregate in new series. The new reference for GDP became GDP at Market Prices. <\/strong><\/p>\n

The differences between these aggregates are due to a segregation of production and product taxes<\/strong>. Production taxes<\/strong> does not change with the level of output,<\/strong> such as stamp duty or registration fees. Product taxes<\/strong> include ad-valorem or indirect taxes.<\/p>\n

There was the inclusion of a new class of assets<\/strong>, namely Intellectual Property and Cultivated Biological resources, under Gross Capital Formation<\/strong>. This addition recognized the growing importance of intangible assets<\/strong> in modern economies.<\/p>\n

Another significant change was the capitalization of Research and Development (R&D) <\/strong>expenditure by government, public and private corporations. In the previous series, R&D was treated as intermediate consumption.<\/strong><\/p>\n

In new series, R&D output was capitalized as intellectual property products<\/strong>. It acknowledges its role in fostering innovation and driving long-term economic growth. <\/strong><\/p>\n

The 2011-12 series also introduced changes in the treatment of Private Final Consumption Expenditure (PFCE) of households<\/strong>. Expenditures on gold and silver were previously considered consumption expenditures.<\/strong><\/p>\n

In the new series, they were reclassified as \u2018valuables\u2019 under capital formation<\/strong>. This change highlighted the role of such spending as a store of wealth and a form of investment, rather than simple consumption.<\/p>\n

The 2011-12 series saw major revisions in the methodology and estimates in several subsectors<\/strong>, such as organized manufacturing and the services sector.<\/p>\n

The incorporation of the MCA21 database<\/strong> improved coverage of registered companies<\/strong> in manufacturing and services.<\/p>\n

A new Effective Labour Input method<\/strong> was introduced for estimating value added in the unincorporated manufacturing and services sector. It considered the differing marginal productivity<\/strong> of various types of workers.<\/p>\n

Unincorporated enterprises<\/strong> that maintained books of accounts were reclassified as \u2018quasi corporations\u2019<\/strong>. These were included in the Private Corporate Sector instead of the Household sector. <\/strong><\/p>\n

The coverage was extended to major municipal bodies and autonomous institutions<\/strong>. It is ensuring a broader representation of economic activities.<\/p>\n

The services sector expanded to include NBFCs, regulatory bodies and services of stockbrokers, mutual funds and pension funds. <\/strong><\/p>\n

The output of the Reserve Bank of India<\/strong> underwent a methodological change. Previously, it was calculated as a mix of market and non-market output<\/strong>. The new series considers the entire output of RBI as a non-market activity <\/strong>and measures it using the cost approach. <\/strong><\/p>\n

What are numerous issues related to 2011-12 series? <\/strong><\/h2>\n

It ranges from methodological concerns to data inconsistencies. <\/strong><\/p>\n

There are issues related to implementation of base year changes, the use of outdated data sources and the impact of a rapidly evolving economy on GDP estimation.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Source- The post is based on the article \u201cUnravelling the complexities of India\u2019s 2011-12 GDP series is key\u201d published in \u201cmint\u201d on 9th May 2023. Syllabus: GS3- Indian economy and growth News – The article explains the changes incorporated in 2011-12 series to calculate the GDP. What are numerous conceptual and statistical changes, incorporated in… Continue reading Unravelling the complexities of India\u2019s 2011-12 GDP series is key<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230,9],"tags":[216,10501,11125],"class_list":["post-241592","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","category-public","tag-gs-paper-3","tag-live-mint","tag-mint","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1701469012},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/241592","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=241592"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/241592\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=241592"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=241592"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=241592"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}