Mumbai: The government on Tuesday defended India’s official growth estimates, forcefully contending that these were backed by a statistically rigorous method that was an international benchmark. It had been validated by both the International Monetary Fund and the World Bank have validated. The statement came after an article by former Chief Economic Adviser Arvind Subramanian suggested that the growth figures are grossly overestimated. In an article on Tuesday, Subramanian -- who was Chief Economic Adviser for Prime Minister Narendra Modi's government between 2014 and 2018 – has said the actual growth figures were closer to 4.5 per cent, rather than the 7 per cent stated by the government.
Subramanian has deduced that the overestimation was due to a change in methodology for calculating the GDP which happened during the first term of PM Modi. He has said so in a research paper published at Harvard University. Manufacturing is one such sector where the calculations have been largely misread, wrote Subramanian, who quit as the chief economic adviser in August last year before his extended tenure was to end in May 2019.
In March, after the budget, Subramanian's predecessor in the government, Raghuram Rajan, too had expressed doubts over Indian economy growing at 7 per cent, when not enough jobs were being created. He had even suggested having an impartial body look at the numbers. Subramanian, too, has suggested that the GDP estimation be revisited by an independent task force comprising national and international experts, statisticians, macro-economists and policy users. Last month, official data showed that economic growth slowed down to a five-year low of 5.8 per cent in January-March, pushing India behind China, due to poor showing by agriculture and manufacturing sectors.
- FPJ NEWS SERVICE
