Former Chief Economic Adviser, Arvind Subramanian has published in his research paper that India’s GDP growth rate was overestimated between 2011 and 2017
- He has stated that the economy expanded by 4.5% as against the reported growth of 7%
- The research paper is published by the Center for International Development at Harvard University.
- With this new statistics, the credibility of the nation is questioned?
“India must restore the reputational damage suffered to data generation in India across the board, from GDP to employment to government accounts,” Arvind Subramanian said.
How this data diddling happened?
In 2012, The Congress-led government had changed the methodology in the calculation of GDP. According to the research paper, the GDP estimates were made more sensitive to price changes, by lowering the oil prices.
Rather than deflating the input values by input prices, the new methodology deflated the values by output prices, which could have overstated manufacturing growth. With this alteration of data coming in picture, a group of 108 economists from around the world questioned whether Indian politicians were trying to influence the figures.
The government’s current chief economic adviser Krishnamurthy Subramanian has not released any statement yet.
However, the immediate step can be investigating the entire methodology and implementation for GDP estimation must be revisited by an independent task force.”