The NewsYet – Centre Clarifies After Ex-Chief Economic Adviser Says “Growth Overestimated” – NDTV News
The NewsYet –
Inaccurate statistics on economy’s health dampen impetus for reform, Arvind Subramanian had said. (File)
Estimates of the country’s economic growth are based on “accepted procedures, methodologies and available data”, the government said today after former Chief Economic Adviser Arvind Subramanian suggested in anarticle in The Indian Expressthat the figures were overestimated. He said the actual growth figures were closer to 4.5 per cent and not 7 per cent between 2011 and 2017, over a period spanning the UPA2 and the NDA1 governments.
In a statement, the Ministry of Statistics said the estimates made are according to the 2008 SNA (System of National Accounts 2008) — the latest version of the international statistical standard for the national accounts, adopted by the United Nations Statistical Commission in 2009.
“With any Base Revision, as new and more regular data sources become available, it is important to note that a comparison of the old and new series are not amenable to simplistic macro-econometric modelling… The GDP estimates released by the Ministry are based on accepted procedures, methodologies and available data and objectively measure the contribution of various sectors in the economy,” the statement read.
Mr Subramanian saidin his article that the changes did not originate from the politicians and were methodological — “the substantive work was done by technocrats, and largely under the UPA-2 government”.
The 60-year-old, who returned to academia after being the Chief Economic Adviser between 2014 and 2018, also said the changes must be distinguished from recent controversies over a back-casting exercise and “puzzling upward revisions” for recent years.
In March, after the budget, Mr Subramanian’s predecessor in the government, Raghuram Rajan, 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.
“In reality, weak job growth and acute financial sector stress may have simply stemmed from modest GDP growth. Going forward, there must be reform urgency stemming from the new knowledge that growth has been tepid, not torrid,” Mr Subramanian said in his article.
He has also suggested that the GDP estimation be revisited by an independent task force comprising national and international experts, statisticians, macro-economists and policy users.