Gross Domestic Knowledge Product (GDKP)

February 12, 2025

Recently, the Government of India revived a proposal to measure the Gross Domestic Knowledge Product (GDKP). This initiative aims to supplement the traditional Gross Domestic Product (GDP) metric. The Ministry of Statistics and Programme Implementation (MoSPI) is leading this effort. It seeks to better understand the impact of knowledge-driven sectors on economic growth.

What is GDKP?

The GDKP concept aims to quantify the contributions of knowledge, innovation, and intellectual assets to the economy.
It recognises that GDP alone does not fully capture the value generated by knowledge-based activities.
GDKP is intended to provide a more nuanced understanding of economic dynamics.

Historical Context

The idea was first discussed in 2021 by NITI Aayog.
At that time, concerns were raised about the lack of a clear methodology for data collection.
The National Statistical Commission expressed reservations about the subjective nature of measuring knowledge.

Current Developments

Recently, MoSPI held a session to explore the GDKP measurement framework. Principal Scientific Advisor Ajay Kumar Sood emphasised the need for a knowledge-centric approach. MoSPI is now actively working to develop this framework.

Methodological Challenges

No clear method to capture the knowledge economy yet.
Identifying relevant parameters for measurement poses a challenge.
Data availability is another concern.
Knowledge-related data may require surveys and subjective assessments.
Some knowledge-related data is already recorded under GDP, but a structured approach is needed.

Satellite Account Approach

MoSPI is considering a “satellite account” approach to measure the knowledge economy. A satellite account is an additional system used to track specific economic activities. This method is similar to existing satellite accounts for tourism, culture and the ocean/blue economy. The goal is to create a separate framework that accurately captures the knowledge base.

Technical Committee Formation

MoSPI plans to establish a technical committee. This committee will evaluate the GDKP proposal and guide the measurement process. Collaboration with various ministries will be essential for effective implementation.

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