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New GDP calculation transforms India into a Tiger economy

New Delhi has changed the base year and now uses market prices instead of factor costs to calculate its GDP.

IT'S not often that a change in the method of calculation can turn a country - erstwhile growing at a tepid rate - into the world's fastest growing major economy. But that's exactly what happened when India announced on Monday its advance estimates of GDP (gross domestic product) growth for fiscal 2014-15.

According to the new numbers, the growth in the Indian economy for the current fiscal year, which will end on March 31, is projected to be 7.4 per cent, up from 6.9 per cent one year ago. This puts India's full-year growth on par with China's.

Moreover, in the October-December 2014 quarter, India clocked an impressive 7.5 per cent growth which beats China's 7.3 per cent for the same period.

The...

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