Reference:

• The National Statistical Office (NSO), Ministry of Statistics and Programme Implementation (MoSPI) released quarterly estimates of Gross Domestic Product (GDP) and its expenditure components at constant (2011-12) and current prices for Q1 (April–June) of FY 2025-26.

Key Points:

• Quarterly estimates of Gross Value Added (GVA) at basic prices for various economic sectors, year-on-year percentage changes, and expenditure components of GDP at constant and current prices for Q1 of FY 2023-24, 2024-25, and 2025-26 are presented in Annexure A, details 1 to 4.

GDP Growth and Quarterly Estimates:

• Real GDP is estimated to grow by 7.8% in Q1 FY 2025-26, compared to 6.5% in Q1 FY 2024-25.
• GDP at current prices increased by 8.8% in Q1 FY 2025-26.

Sectoral Performance (GVA Growth):

• Primary sector (Agriculture, Fisheries, Forestry): Real GVA growth 3.7% (previous year 1.5%)
• Secondary sector: Manufacturing 7.7%, Construction 7.6%, overall growth >7.5%
• Mining & Quarrying: -3.1% decline
• Electricity, Gas, Water Supply & Other Utility Services: 0.5% growth
• Tertiary sector: 9.3% growth (previous year 6.8%)

Consumption and Capital Formation:

• Government Final Consumption Expenditure (GFCE): 9.7% growth (previous year 4.0%)
• Private Final Consumption Expenditure (PFCE): 7.0% growth (previous year 8.3%)
• Gross Fixed Capital Formation (GFCF): 7.8% growth (previous year 6.7%)

Q1 FY 2025-26: GDP and GVA Estimates:

• Real GDP (constant prices): ₹47.89 lakh crore (previous year ₹44.42 lakh crore) – 7.8% growth
• Nominal GDP (current prices): ₹86.05 lakh crore (previous year ₹79.08 lakh crore) – 8.8% growth
• Real GVA (constant prices): ₹44.64 lakh crore (previous year ₹41.47 lakh crore) – 7.6% growth
• GVA (current prices): ₹78.25 lakh crore (previous year ₹71.95 lakh crore) – 8.8% growth

Gross Domestic Product (GDP)

• GDP is the total monetary value of all final goods and services produced within a country over a specific period (usually one year).
• Significance: It measures total economic productivity and growth rate.

Methods of Measurement:

• Production Approach: Based on Gross Value Added (GVA)

• • GVA = Total Output – Value of Intermediate Consumption
  • Includes contributions from Agriculture, Industry, and Services sectors.
• Expenditure Approach:

• • GDP = C + I + G + (X – M)
    • C: Private Final Consumption Expenditure (PFCE)
    • I: Gross Fixed Capital Formation (GFCF)
    • G: Government Final Consumption Expenditure (GFCE)
    • X: Exports
    • M: Imports
• Income Approach:

• • Adds total income generated in the economy (wages, profits, interest, rent)
  • GDP = Wages + Profits + Interest + Rent + Taxes – Subsidies

Types of GDP:

• Real GDP: Calculated at constant prices, removing the effect of inflation to reflect true economic growth. Base year in India: 2011-12
• Nominal GDP: Calculated at current prices, includes inflation effect; shows the current market value of the economy.
• Per Capita GDP: GDP divided by total population, indicating average income and living standards.

Major Institutions’ GDP Growth Forecasts for FY 2025-26:

• Fitch Ratings: 6.3%
• International Monetary Fund (IMF): 6.4%
• S&P Global Ratings: approx. 6.5%
• CRISIL: approx. 6.5%
• Government (Union Budget): 6.7% (real) and 10.1% (nominal)

Gross Value Added (GVA)

• GVA is calculated as the total value produced by a sector (Agriculture, Industry, Services) minus intermediate consumption.
• Formula: GVA = Total Output – Intermediate Inputs
• Example: For a car manufacturer, GVA includes the final value of the car but excludes costs of raw materials (steel, rubber).
• Significance: GVA measures sectoral contributions and serves as a basis for GDP calculation.

GVA Calculation – Sector-wise:

• Agriculture & Allied Sector: Agriculture, Animal Husbandry, Forestry, Fisheries
• Industrial Sector (Secondary): Manufacturing, Construction, Mining, Electricity, Gas & Water Supply
• Service Sector (Tertiary): Trade, Hotels, Transport, Communication, Finance, Real Estate, Public Administration