India's Fake growth story ...
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GDP data is taken with 'pinch of salt' by many economists. It's not hard to manipulate GDP on any country.
Recently economists in US have been talking more about GDI - Gross Domestic Income as a better measure. Also, universities in US are saying there is better way to measure economic progress by using something called as "GDPplus".
Theoretically both should be similar or same, bu as US statisticians found it was not the case.
eg., in 2nd Q, US GDP growth was reported as 2.1%, whereas GDI growth only shows 0.7%.
In India we have 3 different methods of GDP calculation. And all measure show different values, this is not new. So there is always some room for 'interpretation' and choosing what suites us best.
These methods are - Expenditure method / Income method / Production method
Everyone can argue which is best, IMO income method gives a real practical method of how much we are are receiving (adjusted to inflation). Quick example - US 2023 median income has gone down adjusted to inflation, though GDP is higher.
The most significant issue in India is not the GDP value, but the job growth. India has a very low labour market participation, less than most countries.
And on top of that, we have higher share of unemployed. We are not creating enough jobs and our population in increasing.
Recently economists in US have been talking more about GDI - Gross Domestic Income as a better measure. Also, universities in US are saying there is better way to measure economic progress by using something called as "GDPplus".
Theoretically both should be similar or same, bu as US statisticians found it was not the case.
eg., in 2nd Q, US GDP growth was reported as 2.1%, whereas GDI growth only shows 0.7%.
In India we have 3 different methods of GDP calculation. And all measure show different values, this is not new. So there is always some room for 'interpretation' and choosing what suites us best.
These methods are - Expenditure method / Income method / Production method
Everyone can argue which is best, IMO income method gives a real practical method of how much we are are receiving (adjusted to inflation). Quick example - US 2023 median income has gone down adjusted to inflation, though GDP is higher.
The most significant issue in India is not the GDP value, but the job growth. India has a very low labour market participation, less than most countries.
And on top of that, we have higher share of unemployed. We are not creating enough jobs and our population in increasing.
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