The Modi Government, on Friday, sharply revised India’s 2013-14 GDP growth estimate to 6.9 per cent from 4.7 per cent. The 2012-13 growth estimate was revised to 5.1 per cent from 4.5 per cent.
Former Finance Minister and Congress leader P. Chidambaram said that the data released showed that the 10 years of the UPA government recorded the highest decadal growth since Independence. “The data released today and the other economic indicators conclusively establish that the UPA government succeeded in substantial measure on fiscal consolidation, containing the current account deficit, moderating inflation and putting the economy back on the growth path… It should put an end, once and for all time, to the misconceived charge that the UPA government had mismanaged the economy.”
GDP data for a fiscal undergoes three rounds of revisions; the process takes three years. The Central Statistics Office (CSO) releases the second Revised Estimate for a financial year ending in March on the subsequent January 30.
The estimates released on Friday also follow a change in the base year for calculating national accounts to 2011-12 from 2004-05 in addition to the routine annual revision — where changes are made only on the basis of updated data becoming available.
The base year was last revised in January, 2010.
In case of base year revisions, apart from a shift in the reference year for measuring the real growth, conceptual changes, as recommended by the international guidelines, are incorporated, the official release said.
The changes have reduced the gap between the way India calculates GDP and the methodology used by the International Monetary Fund.
“The direction and quantum of revisions show two things—growth delivered by the Manmohan Singh Government was stronger than estimated earlier and the fiscal consolidation was tighter,” Saumitra Chaudhuri, Member of the Economic Advisory Council to former Prime Minister Dr. Manmohan Singh, told The Hindu .
Manufacturing sector The jobs-creating manufacturing sector’s growth estimate for 2013-14 was revised to 6.2 per cent from minus 0.7 per cent and for 2012-13 was revised to 5.3 per cent from 1.1 per cent.
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