TCA Anant: Improve GDP measurement for a well-rounded view of India’s emergence

These changes are more than a tweak to the statistical framework. They signal an acknowledgment of the importance of debates around inequality and the environment. For decades, GDP has been the lodestar of economic progress. But GDP tells us little about what is happening to our natural wealth or how that income is distributed among households. The 2025 revision makes both these blind spots harder to ignore.

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For India—with its ambition of becoming a developed nation by 2047—this is not an arcane statistical matter. It is a chance to place sustainability and inclusiveness at the core of how we narrate our economic story. And, importantly, India is not starting from scratch: over the past 15 years, across two different governments, the country has built an impressive foundation that aligns closely with the directions now formalized in SNA 2025.

Counting the natural resources we deplete and what we create: The new framework’s most significant change is the treatment of natural resources. For the first time, depletion of subsoil resources like coal, iron ore, oil and gas is explicitly recorded as a cost of production, rather than just a decline in asset stock. This means that if India extracts coal or iron ore, the value of the depletion will directly reduce net domestic product (NDP), which measures economic output by subtracting depreciation on assets from gross domestic product (GDP). 

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This change is profound. For resource-rich states like Jharkhand, Odisha, Chhattisgarh and Goa, it implies that headline gross state domestic product (GSDP) may no longer tell the full story of wealth creation if it ignores what is lost in natural capital. Accounting for depletion will sharpen debates on royalties, compensation mechanisms and fiscal transfers. It also strengthens the case for linking extraction revenues with sustainability funds that benefit future generations.

At the same time, renewable resources are now to be recognized as assets. Solar radiation, wind flows, hydro potential and geothermal energy should be part of the national balance sheet— valued through expected future rents. For India, with its rapid expansion in renewable capacity (over 190GW today), this raises the profile of clean energy not just as climate action but as wealth  creation. Countries that invest in renewables will see their balance sheets strengthened.

These recommendations are a continuation of the roadmap outlined by the Expert Group on Green National Accounts (Dasgupta Committee, 2013). The ministry of statistics and programme implementation has been building on these recommendations since 2018 through its annual EnviStats India series, which includes physical and monetary accounts for forests, minerals, energy and water, and has also piloted ecosystem and marine accounts. Thus, some of the elements for complete resource accounting are already in place; what will be needed is a work plan to integrate and align this with the work of the National Accounts Division. It would be good if the forthcoming base revision signals its recommendations on these changes. 

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Distributional accounts or who gets what: Another major innovation in the 2025 SNA is the inclusion of distributional and household accounts as part of the recommended framework. Until now, GDP and national income were published as aggregate totals, with inequality analysis left to separate reports drawn from surveys. SNA 2025 proposes thematic accounts that show how income, consumption, saving and wealth are distributed across household groups—by quintiles, income classes or socio-economic categories.

For India, where inequality debates have sharpened, this could be transformative. Linking national accounts with household surveys (like  the NSS and PLFS), tax data and administrative records will allow policymakers to answer not just ‘how much did the economy grow?’ but also ‘who benefited from that growth?’

The new framework also emphasizes household production beyond the market. Unpaid household and care work, long excluded from GDP, are recommended for inclusion in the extended accounts. For India, where women spend disproportionately high hours on unpaid care, this is critical evidence for framing gender-sensitive policy. The Time Use Surveys of 2019 and 2024 already provide a statistical foundation for making women’s invisible work visible in national statistics.

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Here too, the ministry has laid important groundwork. The Periodic Labour Force Survey (PLFS), launched in 2017, provides regular estimates of employment, earnings and household characteristics; the All India Debt and Investment Survey (AIDIS) offers insights into household wealth distribution; the recently completed Household Consumption Surveys give insights into the distribution of consumption expenditure. A proposed nationwide survey on income will add to this information. So far, the integration of these sources with the National Accounts System (NAS) has been partial. We need a concerted effort to align survey micro-data with NAS aggregates and publish distributional accounts on a regular basis.

At this stage, we must develop a work plan to accommodate SNA 2025 recommendations in the NAS. The base revision exercise underway is an important element of this work. What is perhaps even more important is to develop a strategy to better communicate these improvements and their implications. I have previously written about how India is falling behind in the statistical narrative debate, where the public discourse continues to harp on older failures and does not acknowledge many of our recent innovations. As illustrated above, our statistical system has been working  systematically to anticipate and meet global recommendations. However, we must coherently convey these achievements and developments to arrest criticism. A clear strategy for this becomes even more important in the current age of 24/7 commentary. 

These changes are not just about statistical housekeeping. They are tools to ensure that as we march towards Viksit Bharat by 2047, we will not erode our natural wealth or leave citizens behind.

The author is a visiting professor at the Institute for Studies of Industrial Development and former chief statistician of India.