Why in News?
India’s real GDP growth is projected at 7.4% for FY26, according to the government’s First Advance Estimates, despite global uncertainties like US tariff pressures
GDP-Explained
Gross Domestic Product (GDP) measures the total value of goods and services produced within a country’s borders in a given time period.
It is a key indicator of economic performance and growth.
- GDP = Total value of final goods and services produced within India
- Includes Net Indirect Taxes (GST – Subsidies) added to GVA
- Excludes intermediate goods to avoid double counting
Types of GDP
Nominal GDP:
- Measured at current market prices
- Does not adjust for inflation
Real GDP:
- Adjusted for inflation/deflation
- Reflects actual growth in output
GDP vs GNP
| Feature | GDP | GNP |
| Definition | Production within country | Income of nationals globally |
| Focus | Domestic territory | Ownership (citizens/companies) |
| Includes foreign companies in India | Yes | No |
| Includes income earned abroad | No | Yes |
Examples:
- A foreign company producing goods in India → counted in India’s GDP
- An Indian company earning income abroad → counted in India’s GNP
