RBI switches back to GDP model from GVA

TNPSC Current Affairs - April 2018 by TNPSC Guru 

• Reserve Bank of India has switch backed to Gross Domestic product (GDP) based measure to calculate the Growth Estimates, from Gross Value added (GVA) methodology .
• GVA methodology was adopted by government for Growth estimates from January 2015 , it also changed the base year to 2018 from January 2018.
• The Basic Difference between GDP and GVA is that the GVA gives growth estimates from producer (supply side )and GDP gives growth estimates from consumer side (demand side).

 About GDP: 

Gross Domestic product means the total value of final Goods and services produced over a specific period of time within the boundary of country.

About GVA: 

• Gross Value added is a measure of total output and income of the country.
• It is the total value of final Goods and services produced in the country after deducting  cost of inputs and raw materials that used for producing those goods and services.