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New Delhi : The National Statistical Office (NSO), Ministry of Statistics and Programme Implementation, has released the First Advance Estimates of National Income at both Constant (2011-12) and Current Prices, for the financial year 2020-21 along with the corresponding estimates of expenditure components of the Gross Domestic Product (GDP).
Real GDP or GDP at Constant Prices (2011-12) in the year 2020-21 is likely to attain a level of Rs 134.40 lakh crore as against the Provisional Estimate of GDP for the year 2019-20 of Rs 145.66 lakh crore released on May 31, 2020. The growth in real GDP during 2020-21 is estimated at -7.7 per cent as compared to the growth rate of 4.2 per cent in 2019-20. Real Gross Value Added (GVA) at Basic Prices is estimated at Rs 123.39 lakh crore in 2020-21 as against Rs 133.01 lakh crore in 2019-20, showing a contraction of 7.2 percent.
Nominal GDP or GDP at Current Prices in the year 2020-21 is likely to attain a level of Rs 194.82 lakh crore as against the Provisional Estimate of GDP for the year 2019-20 of Rs. 203.40 lakh crore, released on May 31, 2020. The growth in nominal GDP during 2020-21 is estimated at -4.2 per cent. Nominal GVA at Basic Prices is estimated at Rs 175.77 lakh crore in 2020-21, as against Rs 183.43 lakh crore in 2019-20, showing a contraction of 4.2 percent.
With a view to contain spread of the Covid-19 pandemic, certain restrictions were imposed from March 25, 2020. Though the restrictions have been gradually lifted, there has been an impact on the economic activities as well as on the data collection mechanisms. The data challenges in the case of other underlying macro-economic indicators like IIP and CPI, used in the estimation of National Accounts aggregates will also have implications on these estimates. Further, the projected indices may significantly vary from the actual indices which in turn will depend on the pandemic led economic situation prevalent during those months and specific measures, if any, taken by the government. Estimates are therefore likely to undergo sharp revisions for the aforesaid causes in due course, as per the release calendar.
The First Advance Estimates of GDP have been released in accordance with the release calendar of National Accounts. The approach for compiling the Advance Estimates is based on Benchmark-Indicator method. The sectorwise Estimates are obtained by extrapolation of indicators like (i) Index of Industrial Production (IIP) of first 7 months of the financial year, (ii) financial performance of Listed Companies in the Private Corporate sector available up to quarter ending September, 2020 (iii) 1st Advance Estimates of Crop production, (iv) Accounts of Central & State Governments, (v) information on indicators like Deposits & Credits, Passenger and Freight earnings of Railways, Passengers and Cargo handled by Civil Aviation, Cargo handled at Major Sea Ports, Sales of Commercial Vehicles, etc., available for first 8 months of the financial year. Projections for 2020-21 for Freight earnings of Railways, Passengers and Cargo handled by Civil Aviation, Cargo handled at major Sea Ports were also made available by the agencies concerned which were made use of in compilation of estimates of respective sectors.
With the introduction of Goods and Services Tax (GST) from July 1, 2017, and consequent changes in the tax structure, the total Tax Revenue used for GDP compilation include non-GST revenue and GST revenue. For the year 2020-21, the Budget Estimates of Tax Revenue as available on the website of Controller General of Accounts (CGA) and Comptroller and Auditor General of India (CAG) have been used for estimating taxes on products at Current Prices, according toa PIB release.
For compiling taxes on products at Constant Prices, volume extrapolation is done using volume growth of taxed goods and services and aggregated to get the total volume of taxes. Information available on Revenue expenditure, Interest payments, Subsidies etc. based on detailed analysis of budget documents of Centre and States for 2020-21 were also put to use.