To better reflect the changes in Indian economy, the government has initiated the process to change the base year to 2011-12 from current 2004-05 for computing the country's gross domestic product (GDP). Prices of the base year allows statisticians or economists to examine and compute the performance of the economy in real terms through the macroeconomic aggregates like GDP, national income, consumption expenditure and capital formation.
Ministry of Statistics has highlighted that with the passage of time, new products are manufactured and new data is added, expressing the need to change the base year. However, there will not be change in methodology for computing the GDP.
The government periodically revises the base year for computing the GDP to take into account the structural changes which take place in the economy and to depict a true picture of the economy through macro aggregates. The first official estimates of national income were prepared by the Central Statistical Organisation (CSO) for the estimates at constant prices. The base years of the National Accounts Statistics series have been shifted from 1948-49 to 1960-61 in August 1967; from 1960-61 to 1970-71 in January 1978; from 1970-71 to 1980-81 in February 1988; and from 1980-81 to 1993-94 in February 1999. After that it was changed to 2004-05 in the year of 2006.
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