Former CEA Arvind Subramanian says GDP growth inflated, govt disagrees -Abhishek Waghmare & Arup Roychoudhury
This has reignited the debate on the accuracy of India's GDP numbers in particular, and has once again highlighted the inefficiencies in the estimation of national accounts in general
In a research paper that analyses data on 17 different economic indicators in the real sector, former chief economic advisor of India Arvind Subramanian has said that India’s real gross domestic product (GDP) growth “was more likely to have been between 3.5-5.5 per cent” in the 2011-2016 period, rather than 6.9 per cent as estimated by the National Statistical Office (NSO). He said that the new GDP series overestimated real GDP growth by 2.5 percentage points.
This has reignited the debate on the accuracy of India’s GDP numbers in particular, and has once again highlighted the inefficiencies in the estimation of national accounts in general.
But the government stood by its own numbers, and clarified that the estimation adheres to global norms and is an output of a complex exercise.
“It is important to note that a comparison of the old and new series are not amenable to simplistic macro-econometric modelling,” the statistics ministry said in a press release.
The new series of national accounts with base year 2011-12 was formulated in 2015, and is currently used to compute quarterly and annual GDP, and its methodology has been under scrutiny from economists and statisticians since then.
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