India’s statistical system is preparing to significantly improve how economic output is measured at the district level, a move that could help policymakers identify regional disparities more accurately and design targeted interventions.
Statistics secretary Saurabh Garg told The Times of India that upcoming changes to the country’s GDP series will place greater emphasis on granular data, enabling better estimates of district domestic product (DDP).
“We have given more focus on having more granular data in this series, so that state domestic products are captured much more effectively. We are also moving towards better estimations of district domestic products, which we hope to work with the state govt in the coming months,” Garg said.
This method often produces nearly identical growth rates across districts, failing to capture real economic differences between regions. It also struggles to reflect the impact of local economic shocks or the role of India’s vast informal sector.
Better DDP estimates could help governments pinpoint lagging districts, assess regional inequality more accurately and track employment trends more effectively.
The responsibility for calculating DDP lies with the directorates of economics and statistics (DES) of state governments, working under the technical guidance of the National Statistical Office.
According to Garg, the central government intends to work closely with states to shift from the current allocation-based method to a more detailed, bottom-up estimation process.
“We want to do this in conjunction with the states because that’s where the real policy decisions are, and they have also shown great enthusiasm for this. We will continue to bring out national and state level GDP figures, but we are also working with the states to replace the top-down allocation-based approach with a bottom-up approach,” Garg told ToI.
These include the Annual Survey of Unincorporated Sector Enterprises, which tracks activity in the informal manufacturing and services sector, and the Periodic Labour Force Survey.
Together, these surveys are expected to provide richer information on employment patterns and the economic activities of households, micro, nano and small enterprises — the kinds of establishments that dominate district-level economies across India.
Statistics secretary Saurabh Garg told The Times of India that upcoming changes to the country’s GDP series will place greater emphasis on granular data, enabling better estimates of district domestic product (DDP).
“We have given more focus on having more granular data in this series, so that state domestic products are captured much more effectively. We are also moving towards better estimations of district domestic products, which we hope to work with the state govt in the coming months,” Garg said.
Moving beyond top-down estimates
At present, district GDP estimates rely largely on a top-down allocation method in which state-level GDP is proportionately distributed among districts using indicators such as population.This method often produces nearly identical growth rates across districts, failing to capture real economic differences between regions. It also struggles to reflect the impact of local economic shocks or the role of India’s vast informal sector.
Better DDP estimates could help governments pinpoint lagging districts, assess regional inequality more accurately and track employment trends more effectively.
The responsibility for calculating DDP lies with the directorates of economics and statistics (DES) of state governments, working under the technical guidance of the National Statistical Office.
According to Garg, the central government intends to work closely with states to shift from the current allocation-based method to a more detailed, bottom-up estimation process.
“We want to do this in conjunction with the states because that’s where the real policy decisions are, and they have also shown great enthusiasm for this. We will continue to bring out national and state level GDP figures, but we are also working with the states to replace the top-down allocation-based approach with a bottom-up approach,” Garg told ToI.
New surveys to strengthen local data
The improved district-level estimates will also draw on new datasets being integrated into the upcoming GDP series.These include the Annual Survey of Unincorporated Sector Enterprises, which tracks activity in the informal manufacturing and services sector, and the Periodic Labour Force Survey.
Together, these surveys are expected to provide richer information on employment patterns and the economic activities of households, micro, nano and small enterprises — the kinds of establishments that dominate district-level economies across India.