India's GDP: How it's calculated & why it's always controversial

• India's GDP calculation, primarily using the Production Approach, is annually controversial due to method scrutiny and data issues, despite government claims of international standards.
• Controversy began in 2015 with a base year change (2011-12) and a shift from GDP at Factor Cost to GDP at Market Prices, causing sudden growth increases.
• Key issues include incomplete data from the MCA21 database (listing inactive companies) and reliance on estimates for the 45% unorganized sector.
• Discrepancies during demonetization and COVID, plus a large gap between expenditure and production GDP, fuel ongoing debate about accuracy.
• A new base year (likely 2023-24) is planned for 2025-26, incorporating GST and Aadhaar data, which could lead to further GDP adjustments and renewed debate.

Why It Matters: India's GDP calculation controversies affect its economic data reliability and perception.