Govt 'inflating' growth rate by 'dubious' data: Sitaram Yechury

He argued that the govt's 7.4% growth rate came down to 5.2% when calculated on the basis of the older basis points

Accusing the government of "inflating" growth rate by using "dubious" data, the CPI(M) today said such moves to project that the Indian economy was doing well may help in grabbing global headlines but would not help the economic fundamentals.

"We have once again heard the Prime Minister and the Finance Minister speak about how well the economy is doing and its shining prospects. But nothing will move till public investment is increased in the economy. Changing data-series may help manage global headlines for a while, but won't help fundamentals," CPI(M) General Secretary Sitaram Yechury said.

"On the basis of highly dubious data-series, our GDP growth rate has been inflated. Many commentators and economists continue to point out the deeply flawed statistical basis of such data projections," he said in a Facebook post.

Yechury argued that the government's 7.4% growth rate came down to 5.2% when calculated on the basis of the older basis points.

He said the decline in the fundamental economic indicator - Gross Domestic Capital Formation - meant waning investments in economy.

Plunging industrial production index and manufacturing growth rate between October and November also indicate declining employment generation, the CPI(M) leader said,

He also charged the government with extending tax concessions to corporate sector while common people and farmers suffered due to price rise and agrarian crisis.

Expressing concern over "deepening" agrarian distress resulting in farmers' suicide, Yechury accused BJP of "betraying peasants by not keeping its electoral promise of offering minimum support prices at least 150% of the costs of production.
Yechury also alleged that the government was not passing

the benefits of falling global oil prices to the people and giving them relief from "relentless" price rise.

"Newer levies like the cess for Swachh Bharat (and the rumoured cess on skill development) will only add to the existing burden. Remember, the revenue of such cesses are not shared with the states. The central govt is clearly augmenting its revenues in order to show a reduction in the fiscal deficit prior to the 2016 budget," he claimed.

Yechury said "phenomenal" tax concessions being provided to the corporate sector as "incentives to invite investment" have not borne fruit.

Exports to have gone down, while FDI norms have been relaxed to allow foreign players "maximise their profits" by exploiting Indian mineral resources and cheap labour, with no corresponding benefits to the economy and people here, he alleged.

"Instead of such concessions to India Inc, if all legitimate taxes are collected, a huge amount of revenue would be available for new and high doses of public investment. This public investment is the only way through which all developed economies in the world have built their infrastructure, both economic and social," the Marxist leader contended.