The Murli Manohar Joshi-led panel wants a review in the method of calculating GDP growth
BJP members of the Parliament’s Estimates Committee are at loggerheads with a veteran of their own party – Dr Murli Manohar Joshi – over a report on calculating the growth of India’s Gross Domestic Product (GDP).
Dr Joshi is the chairman of the 30-member Estimates Committee, which has prepared a report titled ‘Measuring Growth, Employment and Income’. The report recommends that the method to calculate India’s Gross Domestic Product (GDP) growth be reviewed. BJP lawmakers led by Nishikant Dubey have said that they will not allow the report to be adopted in its current form. Dr Joshi, on the other hand, is keen on the adoption of the report.
One of the BJP members told Press Trust of India, “It is absolutely incorrect for the report to question the government’s mechanism to calculate GDP data”. BJP has 15 members in the 30-member panel, excluding Dr Joshi.
According to sources, Nishikant Dubey may also give a dissent note against the draft report.
The government’s method to calculate India’s GDP growth was criticised in the past by economists like former Reserve Bank of India governor Raghuram Rajan. The draft report prepared by the Dr Joshi-led panel reportedly shares this scepticism and calls for a review of the government’s method.
The draft report, which was tabled in the Estimates Committee’s meeting on Thursday, states that detailed examination reveals several inadequacies in the GDP measuring mechanism and that factors such as depletion of natural resources have not being taken into consideration.
It also said there is no mechanism to assess whether increase in Gross Domestic Product (GDP) leads to happiness and well-being among people.
In the draft report, the committee concluded that the mechanism to estimate GDP needs review and should reflect the ground reality.
The draft report recommended “review and total revamp of the mechanism to calculate GDP” and emphasised on the need to “evolve indicators to gauge environmental resource decay and replenishment efforts made to compensate the loss and also to capture these aspects in measuring GDP and other economic parameters”.
The report has recommended incorporation of various socio-economic factors “so that the GDP reflects reality and perception”.