India's growth numbers are a total mystery

[Indian Patriot]

And secondly, it isnt too hard to keep projecting positive outlook ,keep fudging figures, whilst internally growing poorly, because at the end of the day who is going to come to ur country and physically go around inspecting stuff.

The investors maybe?

I am not a professional economists shamain ji, so I may not be having the same in depth knowledge on these matters like you but there are problems in artificially fudging figures.

In simple layman terms let us discuss here. Suppose India does claim that it has a GDP growth rate of say 8 percent when in reality it is say 5 percent. How is that going to change anything? A developing country like India needs foreign investment for growth. Say you are the head of Microsoft and seeing India's impressive growth rate on face value you invest 100 billion dollars by calculating the estimated returns on the "8 percent growth rate". After the stipulated time frame you find your returns are not what you expected they would be. Since you are a listed company and you have invested shareholder's money as well you are accountable to them. So you house a board to find out what went wrong. The board/commitee/group finds out that India lied about its growth and effectively cheated Microsoft.

What do you think the impact of such a case of deception will be on Indian economy? Who will invest in India in future?

That was an overly simplistic scenario. Companies who will invest make a ground study first. Companies just don't invest on a whim or emotional judgement. Business, my dear shamain ji, is not conducted like that.

That was the case of business. Now the second case would be about loans. Every country including USA takes loans from World Bank, IMF and other such international groups. Now an "internally poor" country like India takes a loan of 100 billion dollars while claiming a growth rate of 8 percent. The bank puts a stipulated interest rate and expects the base amount + interest within a specific time frame. But since India is "internally poor" like you say India cannot honor its word. How do you think the bank will react?

Hint - How does a bank react if you fail to pay your loans in time?

If fudging numbers was so easy shamain ji you would have had every country on the planet claiming 10% growth rate.

And I have not even taken into account the side-effects of such manipulation like inflation. A certain Robert Mugabe of Zimbabwe was artificially hiking up his currency to boost his economy, in the end zimbabwe was literally bankrupt. Economic growth does not mean you go to the mint and order people to print out 1 trillion dollars without the required goods and services delivered. If you do that your economy will crash. US does indulge in fiat currency now and then but that is why today they have a world record debt that is bigger than their GDP.

I am sorry to say shamain ji but your understanding on economics needs improvement.

 

[SrNair]

Yes I know the meaning of terrific .In this case your economic theory is terrific and astounding.

Even Adam Smith will put his finger on nose due to shame .:girl wacko:

He just missef gems like this.

Do u know what terrific means. Yes what isaid was terrific.


So blind as usual. The article is above,u are denying it, ostrich syndrome.

 

[Shamain]

Yes I know the meaning of terrific .In this case your economic theory is terrific and astounding.

Even Adam Smith will put his finger on nose due to shame .:girl wacko:

He just missef gems like this.

Carry on talking rubbish,u cant face the facts no need to jump around. Go back read the article,ppl having objection to this calculation method are ur own economists ,what the hell is then wrong with u.

And if u have so much issue withit, then dont come to this thread. Duh.

 

[HariPrasad]

Yes i know. I came upon it long time back but avoided posting,


but its 9 feb 2015.this year

My main aim was to show how indian modi gov is fudging gdp figures

Take it eassy. WB and IMF shall not accept those figures if calculated wrongly. It shall be revealed.

 

[SrNair]

The investors maybe?

I am not a professional economists shamain ji, so I may not be having the same in depth knowledge on these matters like you but there are problems in artificially fudging figures.

In simple layman terms let us discuss here. Suppose India does claim that it has a GDP growth rate of say 8 percent when in reality it is say 5 percent. How is that going to change anything? A developing country like India needs foreign investment for growth. Say you are the head of Microsoft and seeing India's impressive growth rate on face value you invest 100 billion dollars by calculating the estimated returns on the "8 percent growth rate". After the stipulated time frame you find your returns are not what you expected they would be. Since you are a listed company and you have invested shareholder's money as well you are accountable to them. So you house a board to find out what went wrong. The board/commitee/group finds out that India lied about its growth and effectively cheated Microsoft.

What do you think the impact of such a case of deception will be on Indian economy? Who will invest in India in future?

That was an overly simplistic scenario. Companies who will invest make a ground study first. Companies just don't invest on a whim or emotional judgement. Business, my dear shamain ji, is not conducted like that.

That was the case of business. Now the second case would be about loans. Every country including USA takes loans from World Bank, IMF and other such international groups. Now an "internally poor" country like India takes a loan of 100 billion dollars while claiming a growth rate of 8 percent. The bank puts a stipulated interest rate and expects the base amount + interest within a specific time frame. But since India is "internally poor" like you say India cannot honor its word. How do you think the bank will react?

Hint - How does a bank react if you fail to pay your loans in time?

If fudging numbers was so easy shamain ji you would have had every country on the planet claiming 10% growth rate.

And I have not even taken into account the side-effects of such manipulation like inflation. A certain Robert Mugabe of Zimbabwe was artificially hiking up his currency to boost his economy, in the end zimbabwe was literally bankrupt. Economic growth does not mean you go to the mint and order people to print out 1 trillion dollars without the required goods and services delivered. If you do that your economy will crash. US does indulge in fiat currency now and then but that is why today they have a world record debt that is bigger than their GDP.

I am sorry to say shamain ji but your understanding on economics needs improvement.

Ignore it dude.
Even Adam Smith would have been laughing like hell in his coffin due to amazing economic theory of OP.

 

[duhastmish]

Works in indias favor. They won't accept "shama ke nukse" to ruin economy.
Maybe govt is not dumb and know a positive out look works in favor.

Your commerce and economy knowledge is unparallele though.

Do u know what terrific means. Yes what isaid was terrific.


So blind as usual. The article is above,u are denying it, ostrich syndrome.

 

[Shamain]

Very surprising i havent even posted any economic theory of my own,i shared news and indian trolls are going mad,attacking my knowledge of economics, grow up read the news again , its not me talking there,but ur economists.

What the hell is wrong with u guys?

 

[SrNair]

Carry on talking rubbish,u cant face the facts no need to jump around. Go back read the article,ppl having objection to this calculation method are ur own economists ,what the hell is then wrong with u.

And if u have so much issue withit, then dont come to this thread. Duh.

And same economicts already convinced about this when our ISO briefed them with clear proofs.
IMF was also involved for the technical evaluation of new methodology.
Link is already in this thread.
Do you want to see rubbish posts ?
All you need is to check your posts in here .

You are successfullly linked farmer suicides with GDP calculation.

And you are talking about world largest democracy in the world.Companies and media will scruitinise each and every fact.Then they will make their investment.
We wont keep silence when you post retard thread like this about our economy.

'Economics is the SCIENCE of Wealth'
-Adam Smith

It is a Science .Proof is necessary .Get used to that basics.

 

[dray]

India's growth numbers are a total mystery - Feb. 9, 2015


Is India's economy red hot or merely trundling along?
The truth is that it's very difficult to say. The country's gross domestic product statistics are a veritable mystery at the moment, muddled by major changes in how economic growth is calculated in Asia's third-largest economy.

Last month, India's government statisticians changed the base year used to calculate national accounts, and made adjustments to better reflect manufacturing activity. Overnight, GDP growth in fiscal year 2014 was upgraded from 4.7% to 6.9%.

The dramatic revisions upended the prevailing narrative, which portrayed India's economy as one that was struggling to gain real traction, even if it was headed in the right direction following the election of Prime Minister Narendra Modi.

With the changes, India's economy was suddenly putting up growth numbers that put it within spitting distance of China.

The latest data using the new method, released Monday, show that GDP grew by 7.5% in the quarter ended December, and a whopping 8.2% the previous quarter -- the second of India's fiscal year.

An early forecast puts fiscal year 2015 growth at 7.4%. That would be bang in line with China's most recent annual growth rate.

Analysts say it's too early to draw major conclusions based on the new data. Many contend that the new growth numbers do not square with evidence of continued weakness.

"But the big story is that new data continue to create confusion," wrote Shilan Shah of Capital Economics. "The key point is that these numbers are inconsistent with a number of indicators that point to a slowdown in the economy for much of the past three years, and continued slack more recently."

Related: India to overtake China as world's fastest growing large economy

Even Arvind Subramanian, the chief economic adviser to the Indian government, is taking a wait and see approach.

"I am puzzled by the new GDP growth numbers," he told the Business Standard last week. "Please don't get me wrong. I am not saying these estimates are wrong in any way, only that these bear further scrutiny."

Confusion over official statistics is unlikely to dampen enthusiasm in India. Modi's new government has gone to great lengths to build a consensus around economic reforms since gaining power in May's parliamentary elections.

The prime minster has promised to end policy paralysis, reduce inflation and tackle corruption. He also pledged to establish manufacturing hubs and industrial corridors, and improve the tax code.

Many of the big ticket reforms haven't been put to the test yet. That will likely happen after the government unveils its budget at the end of this month.

Feb 9 article, and has been discussed a million times. All the updated data have been delivered in the month of April, and everything is in place, nobody is complaining anymore, so calm down and chill.

 

[SrNair]

Very surprising i havent even posted any economic theory of my own,i shared news and indian trolls are going mad,attacking my knowledge of economics, grow up read the news again , its not me talking there,but ur economists.

What the hell is wrong with u guys?

Trolls?
This is a trollthread
A retarded version of a topic that discussed several times in here .

 

[Shamain]

Feb 9 article, and has been discussed a million times. All the updated data have been delivered in the month of April, and everything is in place, nobody is complaining anymore, so calm down and chill.

As u can see i am new here, so had missed discussions., secondly no ihave been reading for a while in news,nothing has been sorted out....what u are talking?

Trolls?
This is a trollthread
A retarded version of a topic that discussed several times in here .

Listen if u have an issue just leave this thread and stop being uninvited nuisance, idont know abt any discussion abt it here, iposted it first time, if u are so well versed then go away,leave the thread alone.

I NEVER LINKED FARMER SUICIDES WITH GDP CALCULATIONS. THAT WAS MORE OF ECONOMIC REFORMS FAILURE WHICH IS AGGRAVATING THE PLIGHT OF FARMERS.

 

[Indian Patriot]

I NEVER LINKED FARMER SUICIDES WITH GDP CALCULATIONS. THAT WAS MORE OF ECONOMIC REFORMS FAILURE WHICH IS AGGRAVATING THE PLIGHT OF FARMERS.

Ok, ok baba. Now calm down. Aap har baat pe gussa ho jate hai.

You shared your views and people are sharing their views. Why are you taking it otherwise?

 

[SrNair]

As u can see i am new here, so had missed discussions., secondly no ihave been reading for a while in news,nothing has been sorted out....what u are talking?


Listen if u have an issue just leave this thread and stop being uninvited nuisance, idont know abt any discussion abt it here, iposted it first time, if u are so well versed then go away,leave the thread alone.

I NEVER LINKED FARMER SUICIDES WITH GDP CALCULATIONS. THAT WAS MORE OF ECONOMIC REFORMS FAILURE WHICH IS AGGRAVATING THE PLIGHT OF FARMERS.

Really ??
Which economic reform aggravated the plight of Farmers in here ?
Still we didnt even .passed Land bill.
Yesterday I have seen a 21 Btech student accomplishments in farming as a hobby and he has lakhs of income from there.
According to him Govt gave them a lots of support.

Of Course some irresponsibility of state govt aggravated the issue.
But climate change and drastic onsequences followed after that is not our economic reform.


And linking Farmers problem with GDP calculation in here is total absurd.
Or I would say you are trying to score brownie points in here.


You cant get away after posting an absurd thread about my nation and its economy.We will react to that whether you like it or not.

 

[niaz]

Being involved in the petroleum industry, I have info concerning Indian energy situation which is also an indication of the health of the economy.

With total energy consumption at about 16-quadrillion Btu per annum, Indian is the 4th largest energy consumer in the world, however its per capita energy consumption of about 620 Kg oil equivalent per capita per annum, is way below the OECD countries. (Quadrillion = one thousand million million). At about 4-million barrels per day refining capacity and also oil imports, India again ranks the 4th largest in the world.

Many Indian publications claim that India has the third largest economy but this claim is probably based on purchasing power parity. At constant prices per the 2015 estimates; India with $2.3 trillion GDP comes 7th behind US, China, Japan, Germany, UK & France. IMF reports also estimate total size of the Indian economy in 2015 at about $2-trillion.

In a mature economy such as the USA, growth rate of more than 4% is considered bad. It indicates that economy is overheating because excess disposal income with the consumer would result in high inflation and a contraction could follow after the boom is bust. On the other hand growth rate of less than 2% means less job creation. Ideal growth rate for the US economy is somewhere around 3% with inflation rate of about 1%.

On this basis I don’t see what is fuss is all about and why Indians are worried about their economy. It is a natural that as the total economy grows in size, %age of GDP growth will decrease. One would have thought that a growth rate in the region of 5 to 6% per annum in economy of this size, would be considered more than satisfactory. However, since there is always a room for improvement; Indian economists & politicians are bickering among themselves. I would be more than glad if Pakistan economy starts growing consistently at about 6% for next 10 years.

P.S.

Before another smart arse Indian member starts accusing me of plagiarism; I admit that I did not dream up these numbers, like all other data/ info with me; most of what I have posted has been obtained from various published sources. ( 2014 data not yet available, figures based mostly on 2013)

 

[dray]

As u can see i am new here, so had missed discussions., secondly no ihave been reading for a while in news,nothing has been sorted out....what u are talking?

As I said, no issues with the figures NOW, and that's why you had to post a Feb 9 article.

Further, nothing extraordinary was done with the GDP calculations, just three standard changes were made. If you want to learn more, then let me know, just post "Teach me" in reply.