New Delhi: Former chief economic adviser Arvind Subramanian on Friday (March 15) said India’s latest GDP numbers are ‘absolutely mystifying’ and difficult to comprehend.
Speaking at the India Today conclave, Subramanian said, “I can’t understand the latest GDP numbers, they are mystifying, and don’t add up. For example, the implied inflation numbers given by the government are between 1-1.5%, but the actual inflation is around 3-5%.”
He also pointed out that while the economy was growing at 7.5%, private consumption was lagging at 3%.
And in the latest data, Subramanian said errors and omissions, which are not accounted for, are actually about 4.3 percentage points out of the estimated 7.6% growth for FY24.
Subramanian served as the chief economic adviser from October 2014 to June 2018.
According to the report, he also flagged that foreign direct investment (FDI) had declined very sharply in the last two or three quarters.
“It’s not just India’s FDI coming down, but also India’s share of global FDI going to emerging markets has also come down. So the question is, if India has become such an attractive place to invest, why isn’t there more FDI? Corporate investment is also well below 2016 levels,” he said.
Also read: With a Rising GDP, but Slow Consumption and Low Savings, Is India’s Workforce Thriving or Surviving?
India’s economy grew by better-than-expected 8.4% in the October-December quarter of fiscal year 2024 – the fastest pace in one-and-half years.
The NSO has also revised GDP estimates for the first and second quarters of this fiscal to 8.2% and 8.1% from 7.8% and 7.6%, respectively.
While Subramanian expressed concerns over the latest GDP numbers, India’s former chief statistician, Pronab Sen, told Karan Thapar that the Q1 GDP growth figure of 7.8% appears to be an overestimation. He said that 6.5% is more accurate.
He added that the GDP growth figure only convey a partial picture of the state of the economy. They do not reveal high levels of unemployment.
According to the Periodic Labour Force Survey (PLFS) data for July 2022 to June 2023, a significant number of individuals in India are engaging in self-employment or unpaid labour.
