Former Chief Economic Adviser Arvind Subramanian has called for an expert investigation to clear doubts around the revised economic growth numbers released last month by the NITI Aayog and the Central Statistics Office, PTI reported on Sunday. He said that institutions without technical expertise to calculate the Gross Domestic Product data should not be involved in the process.
On November 28, the government had revised down the GDP growth rates for the 2006-’12 period, saying it had recalibrated the data to reflect a more accurate picture of the economy. The country was ruled by a Congress-led government during that period.
The data showed the economy had grown 8.5% in 2010-’11, not 10.3% as estimated by the National Statistical Commission in August. Soon after the commission had given its estimates in August, the Centre had said it was not official and was only meant to facilitate a decision on the appropriate approach for calculating a back series.
“I think this [GDP calculation] is a very technical task and technical experts should do the task, institutions that don’t have technical expertise should not be involved in this,” said Subramanian, adding that experts should be tasked with producing and explaining data. Many had questioned the role of NITI Aayog in the release of data of Central Statistics Office last month, forcing the think tank’s Vice-Chairperson Rajiv Kumar to defend its involvement.
Subramanian said that the new series raised a lot of questions, Business Standard reported. “If you look at the other indicators during that period, you see a difference between what those indicators show and what the recent back-series shows,” he said. “It demands an explanation.”
The involvement of technical experts improves the credibility of the data and also reflects on the state’s capability to produce it, he said. “We have to convince ourselves and the world that we are a nation whose numbers are credible, and therefore, we need to get as many experts as we can, and then have an expert technical view,” Subramanian said.
Subramanian, who is currently a visiting lecturer at the Harvard University, asked if the economy felt less of an impact after demonetisation due to the current method used for GDP calculation. “Is it because we are not measuring GDP correctly, or is it because our economy is very resilient?” he asked.
Subramanian last month had described note ban as a “massive, draconian, monetary shock” that accelerated the decline in economic growth to 6.8%.
India had changed the base year for calculating GDP growth to 2011-’12 after the Narendra Modi government took over. In the absence of a back series, GDP data for the years before the new method was introduced was considered incomparable to that for the later years.