Former chief economic adviser Arvind Subramanian’s revelation that India’s GDP growth was grossly overestimated nailed the government’s lie. According to the eminent economist, GDP growth during 2011-12 to 2016-17 was actually 4.5 per cent rather than the 7 per cent as flaunted by the government data. It was a telling argument by him that the growth numbers did not match or relate with key indicators of economic growth such as electricity, consumption, automobile sales, investment and index of industrial production and export earnings, among others.
Many were wondering how the growth rate could be so high when the economy was perceptibly showing signs of faltering. It is common sense that the growth rates could not be as high as claimed by the government when demonetisation and GST had debilitated economic activities. If the claimed growth were real, unemployment rate would not have been at an all-time high. It is now clear that official agencies exaggerated the growth numbers to create a feel-good factor in the run-up to the election.
Instead of treating it as a prestige issue and going in for a "point-by-point" rebuttal, the government should be open to course correction in the country’s interest. The attempt at validating official numbers saying they were arrived at following global standards and endorsed by international agencies would be self-defeating. Now that the election has been won, the government should have no difficulty in acknowledging the incorrectness of the growth numbers and rectifying the inflated figures. It is essential to take policy decisions based on accurate and reliable data and regain credibility. Subramanian was right in saying that the future of 1.4 billion people rides on getting the numbers right. The government should take his word in the right spirit and act accordingly.
G David Milton, Maruthancode
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