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Take GDP data numbers with a pinch of salt, says PMEAC's Ashima Goyal

Mini

After the government lowered the country's economic growth rate during the previous Congress-led United Progressive Alliance(UPA) regime yesterday, Ashima Goyal, Member of prime Minister’s Economic Advisory Council (PMEAC), on Thursday said GDP growth rate numbers need to be taken with a pinch of salt as they come out of a very complex process.

After the government lowered the country's economic growth rate during the previous Congress-led United Progressive Alliance(UPA) regime yesterday, Ashima Goyal, Member of prime Minister’s Economic Advisory Council (PMEAC), on Thursday said GDP growth rate numbers need to be taken with a pinch of salt as they come out of a very complex process.
Recalibrating data of past years using 2011-12 as the base year instead of 2004-05, the Central Statistics Office (CSO) estimated that India's GDP grew by 8.5 per cent in the financial year 2010-11 (April 2010 to March 2011) and not at 10.3 per cent as previously estimated.
Goyal said investment is lower with increased gross domestic product (GDP), which means productivity is higher.
"I think there were a lot of assumptions and benchmarks and extrapolations in our GDP calculations. We should look for improvements in the methodology. We are moving towards international practices and measurements and are using much better data. We should think that the GDP numbers coming in now are a little more reliable than the ones we were working with earlier,” she added.
On Q2 FY19 GDP estimate, Goyal expects 7.5 percent, based on the slowdown seen in credit growth.