NEWS – The government is reviving the concept of GDKP

HIGHLIGHTS

What is Gross Domestic Knowledge Product (GDKP)?

GDKP is a proposed metric to supplement the Gross Domestic Product (GDP) by capturing the impact of knowledge on economic and social life. It aims to measure contributions from knowledge-driven sectors, innovation, and intellectual assets in economic growth.

Shift from Traditional Economic Indicators

• Principal Scientific Advisor Ajay Kumar Sood emphasized the need for a knowledge-centric measurement approach.
• A refined methodology would help better assess the role of knowledge and intellectual capital in national progress.

Government’s Revival of the 2021 Idea

The government is reviving the concept of GDKP, which was initially discussed in 2021 but lacked a clear methodology for implementation.

Ministry of Statistics and Programme Implementation (MoSPI) Initiative

• MoSPI held a session on February 10, 2025, titled “Conceptual Framework of Gross Domestic Knowledge Product (GDKP) Measurement.”
• Chaired by Principal Scientific Advisor Ajay Kumar Sood.
• Aim: Develop a framework to quantify the knowledge economy’s impact.

Exploring the Use of a Satellite Account

Currently, Intellectual Property Products (IPP) expenditures are recorded under Gross Fixed Capital Formation (GFCF) in GDP data.

 MoSPI’s Approach

• MoSPI Secretary Saurabh Garg mentioned exploring the creation of a satellite account for measuring the knowledge base.
• MoSPI has previously worked on satellite accounts for tourism, culture, and the ocean economy.

Need for a Knowledge Economy Measurement System

• The session highlighted the lack of an existing formulation to measure the knowledge economy.
• MoSPI plans to form a technical committee to evaluate and guide the methodology for GDKP measurement.

NITI Aayog’s Earlier Proposal (2021)

In 2021, NITI Aayog proposed GDKP, but the concept lacked clarity on methodology and data collection.

Challenges Identified by the National Statistical Commission (NSC)

• The proposal did not specify how to measure or compute GDKP.
• Identifying knowledge parameters and adjusting them for real-world outcomes was challenging.
• The concept involved subjectivity and needed further refinement.

MoSPI’s Observations in 2021

• The 2021 concept paper suggested GDKP as a supplement to GDP but lacked details on integration.
• Data for GDKP was not readily available, necessitating perception-based surveys.
• Some aspects of GDKP are already captured in GDP, requiring a proper methodology for integration.

The Way Forward

• MoSPI’s technical committee will refine the methodology and parameters for GDKP measurement.
• The initiative aims to provide a more comprehensive economic assessment beyond GDP.
• Successful implementation could establish India as a leader in knowledge economy metrics.