Can a sleight of hand bring about an economic miracle? The government of the day apparently thinks so, as its economic mandarins have revised the base year for calculating India’s GDP from 2011-12 to 2022-23. As a result of this, the ‘real’ GDP growth rate for fiscal 2025-26 has been pushed up to 7.6 per cent, higher than the 7.1 per cent recorded in fiscal 2024-25. This, even while there is no noticeable improvement in several economic parameters.

The government loves to highlight the macro indicator of the Indian economy emerging as the fourth largest globally and the fastest growing one, at a time when other major economies have slowed down on account of widespread uncertainties caused by growing geopolitical tensions. The new GDP figure is hard to believe as it is clearly not rooted in economic ground realities. In fact, this is for the first time in India’s economic history that a new base year has been so boldly adopted and numbers revised – truly a masterstroke for the ages!

The government’s rationale is that the base year for calculating GDP has been revised in order to better reflect India’s evolving economic structure. The revised GDP series integrates new, improved data sources such as ASUSE, PLFS, GST and PFMS. Thus, India’s growth trajectory will now be shaped not by economic performance alone but also by the quality and credibility of its statistical systems. To this end, the comprehensive overview of the country’s GDP with the base year of 2022-23 reflects the evolving momentum of the economy in comparison with previous fiscal years.

In step with this ‘revision’, the CPI base year has also been revised to 2024 and the IIP (index of industrial production) to 2022-23, indicating that India’s statistical system is undergoing a comprehensive modernisation.

Be that as it may, the government should make it clear that the unexpected hike in the GDP growth rate has no connection with real economic growth and is not the outcome of any government plan to boost economic activity.

The real picture is that the global environment is overflowing with uncertainties. Mounting unemployment in the country is a serious economic and social problem. And as if this is not enough, jobs are on the decline. There has been a steep fall in hiring by the IT sector. New technologies like Artificial Intelligence (AI) have drastically reduced job opportunities as large companies the world over are removing workers in the thousands from their jobs. Inflation is technically benign but prices of essentials have gone so high that the household budgets of millions of middle class and low-income citizens have been upended. Moreover, US President Donald Trump’s tariff policies have jolted the country’s export sector.

The government claims that there has been a sharp fall in the number of people below the poverty line during the 11-year rule of the NDA. Prime Minister Narendra Modi has gone on record to say that the government is feeding 80 crore poor Indians by supplying them food free of cost. We do not wish to wrangle with him on this claim, but the undeniable fact is that India is far behind countries like Germany, the UK and Japan as far as the living standards of citizens are concerned. Therefore, the need of the hour is to take the deteriorating economic situation seriously and take concrete steps to give a real boost to the economy so that our GDP growth is observable across various parameters on the ground.