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Furious Montek slams OECD's India growth forecast, says 'it doesn't know what it is doing'

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Furious Montek slams OECD's India growth forecast, says 'it doesn't know what it is doing' (Reuters) Furious Montek slams OECD's India growth forecast, says 'it doesn't know what it is doing' (Reuters)
SummaryThe OECD, Ahluwalia said, had mechanically projected deceleration of growth rate

Describing OECD's 4.4 per cent economic growth forecast for India in the current fiscal as "completely wrong", Planning Commission Deputy Chairman Montek Singh Ahluwalia today said the think-tank does not know what it is doing.

"I was thinking of telling OECD that I just don't think that they know what they are doing," he told PTI.

Admitting that 2012-13 was not going to a good year, Ahluwalia, however, said "OECD (Organisation for Economic Cooperation and Development) estimate is completely wrong."

Presenting a gloomy picture for India, the Paris-based think-tank OECD had said that growth rate was expected to decelerate sharply to 4.4 per cent in the current fiscal from 6.9 per cent growth in 2011-12.

The OECD, Ahluwalia said, had mechanically projected deceleration of growth rate without taking into consideration the expenditure trends and national accounting practises.

The OECD had failed to understand that there was a distortion in the data for the first quarter, he said, adding "they have mechanically projected as if deceleration has continued very sharply". Also, he added, the OECD did not take into account the fact there is bunching of subsidy.

The economic growth rate in the first quarter of the current fiscal (April-June) dipped to decade's low of 5.5 per cent and the data for the second quarter is to be announced on November 30.

The Reserve Bank, as per the latest projections, expects the economic growth rate to slip further to 5.8 per cent in the current fiscal from 6.5 per cent recorded in 2011-12.

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