Economics
Difficult-to-Predict India Economy Inspires New Measuring Tools
- Economists come up with new indexes to track growth in India
- Bloomberg’s GDP Tracker compares better with the old series
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The world’s fastest-growing economy is also one of the most difficult to decipher. A change in the methodology to calculate gross domestic product is partly why India’s data is puzzling and is prompting economists to find a workaround.
India’s new GDP series, introduced in 2015 with back-data available since 2012, relies more heavily on nominal indicators in two key areas relative to the old series, according to Abhishek Gupta, India economist with Bloomberg Economics in Mumbai. The lack of appropriate price indexes to deflate these nominal indicators now results in a greater separation of the new series from high frequency volume-based economic indicators, he said.