Context: Recently, the Ministry of Statistics and Programme Implementation (MoSPI) released the First Advance Estimates (FAE) for the current financial year.
More on the news: According to MoSPI, India’s gross domestic product (GDP) - the total value of all final goods and services produced within the country in one financial year - will contract by 7.7 per cent in 2020-21.
Significance of Advance estimates:
- For any financial year, the MoSPI provides regular estimates of GDP. The first such instance is through the FAE.
- The FAE for any particular financial year is typically presented on January 7th.
- Their significance lies in the fact that they are the GDP estimates that the Union Finance Ministry uses to decide the next financial year’s Budget allocations.
- The FAE will be quickly updated as more information becomes available.
Source: Financial Express