Skip to main content

India's GDP growth 5.2% in 2015-16, not 7.1% in 2014-15 as claimed by Govt of India: CMIE

 
Sharply disputing the Government of India's estimate that India's gross national product (GDP) grew at 7.6 per cent in the financial year 2015-16, India's top statistical consultancy firm Centre for Monitoring Indian Economy (CMIE) has said that, according to its calculation, it should be 5.2 per cent, down from 7.1 per cent a year earlier.
CMIE says, “Of the 7.6 per cent growth in GDP for the year, 2.4 per cent came form discrepancies. The discrepancies amounted to Rs 2.2 trillion. Excluding discrepancies, India’s GDP would have grown by 5.2 per cent in 2015-16, as against a 7.1 per cent growth in 2014-15, which also excludes discrepancies.”
“That means the entire improvement or acceleration in growth rests upon the discrepancies figures”, it underlines.
According to experts, “discrepancies” make up the difference between estimation of GDP through the production side and expenditure side. They further explain it as the difference between aggregate of private consumption expenditure, government expenditure, investment and net export, and GDP estimated from production approach.
The larger the “discrepancies,” the more worried one is likely to get about the veracity of production side GDP, they believe.
Coming to the claim that in the last quarter of 2015-16 (January-March 2016), when the Indian economy “almost touched the 8 per cent magic growth figure”, as claimed by Niti Aayog's Arvind Panagariya, an economist from Columbia University hired by Prime Minister Narendra Modi, the CMIE says, things are “no different”.
CMIE underlines, “Of the 7.9 per cent growth in GDP during the quarter, 4.1 per cent came from discrepancies. Excluding discrepancies, the 3.9 per cent growth in GDP would have been the lowest in last 13 quarters.”
CMIE is not only expert body which has disputed Government of India data. The prestigious British daily, “Financial Times” (FT) through a blog “Discrepancies and Indian GDP data” by David Keohane has said that the claim of the country’s status as the world’s “fastest expanding large economy” and the “most dynamic emerging market” is a “qualified, confusing good news.”
It quotes Goldman noting as noting that the “data from the expenditure side shows that the improvement in GDP growth in Q1 (of 2016) was largely driven by higher private consumption and relatively lower drag from net exports.”
Further: “Fixed investment declined for the first time since March 2014... A significant fraction of headline GDP growth is unexplained as ‘discrepancies ‘ amount to 4ppt of GDP vs 2.1ppt in the previous quarter (the discrepancy is the difference with the industry GDP data, which are used as the control). ”
The FT bog also quotes SocGen as saying, “At 7.9% yoy, it was the strongest growth rate recorded in the past six quarters. Domestic demand, which has been holding up fairly well this year, emerged as the largest contributor to growth (8.3% yoy).”
However, SocGen underlines, “Unfortunately, discrepancy was the other major growth driver, raising questions about the continued poor quality of data. Discrepancy was as high as 4.8% of GDP, the highest ever in the history of the new data series, and accounted for virtually 50% of the increase in real GDP. ”
It also quotes CapEcon’s Shilan Shah as saying that India's GDP figures “are hard to align with other evidence on the economy’s health. For instance, today’s data show manufacturing expanding 9.3% y/y last quarter. By contrast, the monthly data on industrial production show output rising just 0.2% y/y in Q1, from growth of 1.8% y/y in Q4.”
Shah further says, “Admittedly, there is reason to believe that economic growth has picked up recently. For example, auto sales and cargo volumes have accelerated. But the short point is that – as we have cautioned since the release of the revised GDP series last year – we should take the official GDP data, and the world-beating rates of growth they are suggesting, with a pinch of salt. ”

Comments

TRENDING

Dalit rights and political tensions: Why is Mevani at odds with Congress leadership?

While I have known Jignesh Mevani, one of the dozen-odd Congress MLAs from Gujarat, ever since my Gandhinagar days—when he was a young activist aligned with well-known human rights lawyer Mukul Sinha’s organisation, Jan Sangharsh Manch—he became famous following the July 2016 Una Dalit atrocity, in which seven members of a family were brutally assaulted by self-proclaimed cow vigilantes while skinning a dead cow, a traditional occupation among Dalits.  

Global NGO slams India for media clampdown during conflict, downplays Pakistan

A global civil rights group, Civicus has taken strong exception to how critical commentaries during the “recent conflict” with Pakistan were censored in India, with journalists getting “targeted”. I have no quarrel with the Civicus view, as the facts mentioned in it are all true.

Whither SCOPE? Twelve years on, Gujarat’s official English remains frozen in time

While writing my previous blog on how and why Narendra Modi went out of his way to promote English when he was Gujarat chief minister — despite opposition from people in the Sangh Parivar — I came across an interesting write-up by Aakar Patel, a well-known name among journalists and civil society circles.

Remembering Vijay Rupani: A quiet BJP leader who listened beyond party lines

Late evening on June 12, a senior sociologist of Indian origin, who lives in Vienna, asked me a pointed question: Of the 241 persons who died as a result of the devastating plane crash in Ahmedabad the other day, did I know anyone? I had no hesitation in telling her: former Gujarat chief minister Vijay Rupani, whom I described to her as "one of the more sensible persons in the BJP leadership."

Unchecked urbanisation, waste dumping: Study warns of 'invited disaster' as khadi floods threaten half of Surat

An action research report, “Invited Disaster: Khadi Floods in Surat City”, published by two civil rights groups, Paryavaran Suraksha Samiti and the People's Union for Civil Liberties, Surat, states that nearly half of Gujarat's top urban conglomerate—known for its concentration of textile and diamond polishing industries—is affected by the dumping of debris and solid waste, along with the release of treated and untreated sewage into the khadis (rivulets), thereby increasing the risk of flood disaster.

Polymath academy or echo chamber? A personal take on knowledge, control, and WhatsApp moderation

A few months back, I was made a member of a WhatsApp group called Polymath Academy. Frankly, I didn’t know what the word polymath meant until its administrator, veteran Gujarat-based sociologist Vidyut Joshi — with whom I have been interacting since the mid-1990s when he was with the Gandhi Labour Institute — told me it refers to a person with an exceptional academic record.

Two decades on, hunger still haunts Gujarat: Survey exposes stark gap behind poverty claims

A Niti Aayog report , released about two years ago, estimated that in Gujarat — which our powers-that-be have long considered a model state — 11.66% of people are "multidimensionally poor," a term referring to an index that seeks to estimate "multiple and simultaneous deprivations" at the household level across three macro categories: health, education, and living standards.

English proficiency for empowerment: Modi’s SCOPE vision contrasts Amit Shah’s remark

While Union Home Minister Amit Shah may have asserted that soon a time would come when those speaking English in the country would “feel ashamed”, it is ironic that Narendra Modi, when he was Gujarat chief minister, had launched what was called the SCOPE programme, actively involving the University of Cambridge to provide opportunities to the youth of Gujarat to "become not just job seekers but job creators (entrepreneurs)."

Whither whistleblower concerns? Air India crash: Govt of India report suggests human error

Is the Ministry of Civil Aviation, Government of India, seeking to bail out Boeing in its preliminary report released recently despite the top MNC's whistleblower concerns ? It would seem so, if the Ministry's Aircraft Accident Investigation Bureau's (AAIB's) preliminary findings into the catastrophic crash of Air India’s Boeing 787-8 Dreamliner, registration VT-ANB, which went down shortly after takeoff from Ahmedabad on 12 June 2025, killing all 241 on board and 19 on the ground, is any indication.