RBI Guv welcomes MoSPI's base year revision exercise of key macro indicators

New Delhi, Jan 16 (PTI) The base year revision for CPI, GDP, and IIP by the Statistics Ministry will reflect changing consumption patterns, economic structures, and support better-calibrated monetary policy and growth, Reserve Bank Governor Sanjay Malhotra has said.

The Ministry of Statistics and Programme Implementation (MOSPI) has announced base year revision of the Consumer Price Index (CPI), Gross Domestic Product (GDP), and Index of Industrial Production (IIP).

Welcoming the MoSPI's decision, Malhotra, macroeconomic indicators such as CPI, GDP and IIP play a very vital role in policymaking in the RBI.

This exercise is not merely a revision in the base year, but it also covers revisions in methods, weights, item baskets, data sources and computation techniques, he said in a video message posted by MoSPI on social media platform X.

"For us, CPI is especially important for monetary policy purposes because it anchors our flexible inflation targeting framework," he said.

Malhotra said updating the base year of CPI will ensure that the index reflects the consumption patterns and household spending more accurately, as they have obviously changed over a period of time.

Similarly, GDP numbers are very important, he added.

The GDP needs to capture the evolving structure of the Indian economy, which has again transformed and changed with the rising role of services, digital activities and various new business models, Malhotra said.

The IIP base revision, he said, will also help us in improving assessments of the underlying momentum in the real economy. Overall, I would like to congratulate the MOSPI.

"It is a very timely and a very welcome step. By strengthening our statistical systems, it will facilitate more calibrated policies," he said.

Malhotra said revising the base year will also help in sustaining both price stability and improving economic growth.

The December CPI-based retail inflation data released by the MoSPI was the last of the current series (2012).

The January inflation will be calculated under a new CPI series with the base year (2024 = 100). The new series is expected to be a comprehensive revision of coverage, item basket, weights and methodology used in index compilation.

The CPI-based on the new series, will be released in February.

It will also release a new series for national accounts next month and industrial production later in the year. PTI NKD BAL