India’s Revision in GDP Formula Raises GDP Growth Rate by 2% – SNL Financial features Comments from IEMS’ Sujata Visaria
SNL Financial contacted IEMS’ Sujata Visaria for her commentary on the Indian government’s recent changes to its GDP calculation methodology which, if applied to the current year and previous years, increases India’s aggregate GDP points by an additional 2%.
As Sujata Visaria said of the changes:
“If the true GDP growth rate is lower than what these numbers are suggesting, there has to be some explanation. If the government organizations wish to make the growth rates look larger than they actually are, you have to understand what actually [the Central Statistical Organisation] did,” Sujata Visaria, an assistant economics professor at the Hong Kong University of Science and Technology, who received a Master’s degree in economics in India, told SNL Financial.
“Visaria does not think the Indian government’s new GDP calculation methodology is aimed at inflating growth numbers.
“My understanding is that Indian data are quite precise,” she said. “Changing a reference is not a problem. Changing a reference makes sense because from time to time, the consumer basket changes, and so you want to change the reference year.””
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If the true GDP growth rate is lower than what these numbers are suggesting, there has to be some explanation. If the government organizations wish to make the growth rates look larger than they actually are, you have to understand what actually [the Central Statistical Organisation] did,
Sujata Visaria
