AbstractAn ensemble prediction system quantifies the uncertainty in the forecast by a numerical weather prediction model and helps in decision‐making. The global ensemble prediction system (NEPS‐G) of NCMRWF, India, has 1 control and 22 perturbed ensemble members. In the present study, the relative economic value of NEPS‐G forecast has been investigated based on a simple decision‐analytic model. Temperature at 850 hPa (T850), maximum surface temperature (Tmax) and precipitation (rf) over the Indian domain have been studied. Ensemble mean forecast offers a larger value to the users than the control forecast. For rare extreme events, the area under the curve (T‐AUC) of a relative operating characteristic (ROC) obtained using the trapezoidal approximation for 22‐member NEPS‐G (NEPS‐22) is significantly smaller than the area under the curve (Z‐AUC) of the full ROC obtained using binormal model and Z‐transformation. As a result, the discrimination ability and relative economic value of NEPS‐G are underestimated. A method (SUB‐EM) which subdivides the lowest probability category into several subcategories and uses ensemble mean forecast as the secondary decision variable to enhance T‐AUC and improve relative economic value of NEPS‐G has been investigated. Tmax > 45°C and rf > 65 mm·day−1 have been considered as extreme events. The impact of increasing the number of perturbed ensemble members from 22 to 33 (NEPS‐33) by running additional 11 perturbed members from 0000 UTC initial condition has also been investigated and compared with the results obtained using SUB‐EM. SUB‐EM offers larger economic value to the users with small cost–loss ratio (α) without engaging any extra computational resources. An experiment is also carried out to study the impact of using different ensemble summary statistics as a secondary decision variable. Ensemble Maximum provides maximum value and benefits the largest range of users.