Why Budget 2026 GDP and inflation numbers may change within weeks

Key GDP and inflation metrics will be revised in February as MoSPI updates base years, meaning several assumptions underpinning Budget 2026 will be recalculated soon after the speech

When the Union Budget is presented on Sunday, February 1, which is a first in itself, it will also arrive with an unusually short-lived shelf life. Several of India’s most closely watched macroeconomic indicators, including GDP growth numbers and retail inflation measured through the Consumer Price Index (CPI), are set for revision later in February by the Ministry of Statistics and Programme Implementation (MoSPI). The ministry will release new statistical series with updated base years on February 27. That effectively means many of the assumptions underpinning Budget 2026 will be overtaken by new data within weeks.

Which key economic numbers will change after Budget 2026?

GDP numbers: The current GDP series uses 2011–12 as the base year, and the revised numbers reflecting the latest base year will be released on February 27. While such revisions are not new, as India periodically updates base years to reflect structural changes in the economy, shifts in consumption patterns, production, technology adoption and sectoral weights, economists have questioned the timing of a revision that follows the Budget rather than preceding it.  Inflation data: CPI inflation is calculated using a consumption basket and base year that are periodically revised to reflect how households actually spend. National Accounts data will follow 2022–23 as the base year and will be released on February 12, while the CPI revision will take place at the end of February, according to a PTI report. 

 

Industrial production series: The Index of Industrial Production (IIP) is also set for revision, which will be rolled out in May this year. 

Once these new series are introduced, historical data will be recalculated, altering growth rates, inflation trends and nominal values that form the backbone of fiscal projections. 

Why does the timing matter for Budget 2026?

Economists are of the view that Budget arithmetic depends heavily on macroeconomic assumptions. GDP estimates shape projections for tax collections, fiscal deficit ratios and debt metrics, while inflation assumptions influence expenditure forecasts, subsidy allocations and real income estimates. 

Because Budget 2026 will be framed using the existing GDP and CPI series, its headline ratios may not be directly comparable with the numbers recalculated under the new base years. 

In effect, the Budget will be presented using numbers that are already close to expiry. 

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Has India seen such revisions before?

The last major GDP base year revision took effect in January 2015, when India shifted the base year from 2004–05 to 2011–12. That change led to sharp revisions in historical growth rates, with GDP growth for several earlier years revised upwards. Economists note that such revisions alter perceptions of India’s economic performance and complicate comparisons with earlier Budgets. 

However, this does not imply that Budget numbers are incorrect. It simply means they are provisional and framed within a measurement system that is about to be updated.

How should Budget 2026 be read?

For analysts, economists and readers alike, the key takeaway is to separate policy intent from numerical arithmetic. Spending priorities, tax policy choices and reform signals will remain relevant, but headline figures tied to growth, inflation and fiscal ratios will need to be revisited once the new data series comes into force.