Daily RC and Vocabulary 3rd March 2026

The release of the new series of national accounts data is a heartening improve ment to India’s key economic statistics, but the data highlights some aspects that merit policy attention. The new series updates the base year of India’s Gross Domestic Product and Gross Value Added data to 2022-23 from the earlier 2011-12. This was a long-overdue update, since the earlier data was becoming more outdated and unrepresentative with each passing year. Apart from the updated base year, the new series has several methodological improvements and new data sources for greater robustness. For ex ample, the adoption of the double-de ator ap proach, which accounts for the e ect of in ation separately for intermediate goods and the nal product, is a marked improvement in terms of as certaining the real value added of India’s produc tion. Similarly, the new series allocates multi-sec tor company output proportionately, improving sectoral data accuracy. The data on households will now be obtained from the Annual Survey of Unincorporated Sector Enterprises (ASUSE) and Periodic Labour Force Survey (PLFS) on an an nual basis instead of relying on extrapolations as was done in the 2011-12 series. Notably, the Goods and Services Tax data, a goldmine of consumer data, will be used in the new series. The new se ries will also include new sources and methods of estimation for sectors that have historically been di cult to quantify such as the agricultural sector and the vast informal sector. All of these should yield a more accurate picture of India’s economic size and growth. The new series predicts India’s GDP to grow 7.6% in the current nancial year 2025-26, which is faster than the 7.4% predicted for the year in the old series. While the rate might bring cheer, the new absolute size of the economy is some what sobering. The new series pegs India’s eco nomy at 345.47 lakh crore in 2025-26, which is about 3.3% smaller than what was predicted based on the old series. The size of the economy in both 2023-24 and 2024-25 was also revised downward by 3.8% each. Along withthe depre ciation of the rupee, this has meant that India is currently a $3.8 trillion economy, with the $5 tril lion target moving further away. A smaller eco nomic size also means the Centre’s various com mitments to lower the scal de cit and debt — ratios that are pegged to nominal GDP — also be come that much tougher to achieve. That said, it is better to realign targets based on more accu rate data than to blithely forge ahead with de cade-old metrics



1️. Realign

Meaning: To adjust or change something to fit a new situation.
Example: The government had to realign its fiscal targets after the GDP revision.

2️. Robustness

Meaning: Strength and reliability.
Example: The use of GST data improves the robustness of economic estimates.

3️. Methodological

Meaning: Related to a system of methods used in a study or activity.
Example: The new GDP series includes several methodological improvements.

4️. Ascertain

Meaning: To find out something with certainty.
Example: The double deflator method helps ascertain the real value of output.

5️. Extrapolation

Meaning: Estimating unknown values using existing data.
Example: Earlier GDP estimates relied heavily on extrapolation.

6️. Proportionately

Meaning: In a way that is properly balanced according to size or amount.
Example: Company output is now distributed proportionately across sectors.

7️. Sobering

Meaning: Serious or making one realize something important.
Example: The smaller size of the economy is a sobering development.

8️.Depreciation

Meaning: A fall in value, especially of a currency.
Example: Rupee depreciation reduced India’s dollar GDP size.

9️. Blithely

Meaning: In a careless or unconcerned manner.
Example: Policymakers cannot blithely ignore updated data.

10. Commitments

Meaning: Obligations or promises to achieve something.
Example: Fiscal commitments become harder when GDP is revised downward.



1️. Which of the following best captures the central argument of the editorial?

A) The new GDP series artificially inflates India’s growth rate.
B) Methodological improvements in GDP estimation may complicate fiscal targets but enhance statistical credibility.
C) The informal sector has been overestimated in earlier GDP calculations.
D) The $5 trillion target is now permanently unattainable.

Answer: B

2️. The adoption of the double deflator method primarily addresses which concern in national income accounting?

A) Underreporting of exports
B) Overestimation of fiscal deficit
C) Distortion in measuring real value added due to differential inflation effects
D) Inaccurate currency conversion into dollar terms

Answer: C

3️. The editorial suggests that a downward revision in nominal GDP makes fiscal consolidation more difficult because:

A) Government expenditure automatically rises.
B) Tax rates must be increased proportionately.
C) Fiscal deficit and debt ratios are calculated relative to GDP.
D) Inflation accelerates immediately after revision.

Answer: C

4️. The tone of the editorial toward the new GDP series can best be described as:

A) Alarmist and pessimistic
B) Celebratory and nationalistic
C) Balanced and cautiously supportive
D) Critical and dismissive

Answer: C

5️. Which of the following is NOT presented as a methodological improvement in the new GDP series?

A) Use of GST data for better consumption tracking
B) Proportionate allocation of multi-sector company output
C) Replacement of surveys with complete elimination of informal sector estimates
D) Annual household data from ASUSE and PLFS

Answer: C