GDP debate: The number may be 7.8%, but the questions are real

India’s GDP growth debate has quickly become a political fight. It should not be.

The government says the economy grew a robust 7.8% in the April-June quarter. Former finance secretary Subhash Chandra Garg says the real growth could be as low as 2.6%. Somewhere between the two claims lies a more important question: can we trust the numbers, and can we easily understand how we got there?

The government has a perfectly valid statistical argument. The ₹86.05 lakh crore Q1 FY26 nominal GDP figure being used to arrive at the 2.6% calculation belongs to the old GDP series. Under the new 2022-23 base-year series, Q1 FY26 nominal GDP has been revised to about ₹80 lakh crore. On a like-for-like basis, the official numbers show real GDP rising from ₹75.46 lakh crore to ₹81.36 lakh crore — a 7.8% increase.

So, no, simply dividing ₹88.27 lakh crore by ₹86.05 lakh crore and calling the difference “real GDP growth” is not a valid comparison.

But that does not mean the debate should be dismissed.

The sharp revision in the previous year’s numbers is precisely why people are asking questions. GDP is not just another government statistic. It is the number on which policy decisions are made, corporate expectations are built and India’s economic performance is judged globally.

The statistics ministry says the revisions reflect the new base year, better data sources, more granular price data and methodological changes, including greater use of producer-price information. It also says there is no systematic downward revision designed to make current growth look better.

Fine. Then the answer is not to shout down the critics. It is to make the entire revision trail easier to follow.

There is another reason to be cautious about getting carried away by 7.8%. Strong headline GDP growth does not automatically mean that prosperity is broad-based. Q1 growth was helped by manufacturing and services, while private consumption grew 7.1% and fixed investment grew 11.9%. Those are encouraging numbers. But the real test is whether this momentum translates into sustained private investment, productive employment and stronger household incomes.

That is where the GDP debate should go.

The government should defend the 7.8% number with data, not rhetoric. Critics should scrutinise the methodology without mixing different statistical series. And journalists should resist the temptation to turn a complicated statistical argument into a simple “7.8% versus 2.6%” political headline.

India may well be growing at 7.8%. The official comparable data says so.

But a credible GDP number is not merely one that can be calculated. It is one that ordinary people, economists and investors can understand, reproduce and trust.

That is the real issue in this debate.