CEA Subramanian counters Raghuram Rajan on GDP data: Controversy baseless; growth best since liberalisation

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Updated: Mar 30, 2019 12:25 PM

Responding to the doubts raised by former RBI Governor Raghuram Rajan, Chief Economic Advisor (CEA), Krishnamurthy Subramanian said that the ongoing controversy over growth data is baseless.

He said that GST and Insolvency and Bankruptcy Code (IBC) were transformational reforms by the current government.

Responding to the doubts raised by former RBI Governor Raghuram Rajan, Chief Economic Advisor (CEA), Krishnamurthy Subramanian said that the ongoing controversy over growth data is baseless. The narrative which is being created over GDP data is further from the truth, media reports said citing the CEA.

On Tuesday, Raghuram Rajan had expressed surprise over the economy growing at 7 per cent and not producing enough jobs. He had said that an impartial body must be appointed to check the authenticity of the data.

Also read: Current account deficit widens to 2.5% of GDP in Q3 on account of a higher trade deficit

The 7.5 per cent growth seen by the Indian economy has been at a very high rate against the global headwinds and slowing credit growth, he said in the keynote address at a CII Conclave in Chennai on Friday. Explaining further, he said that the touch-points of policy in the country are large. The average rate of growth recorded is the highest for any government since liberalization, he added.

He said that GST and Insolvency and Bankruptcy Code (IBC) were transformational reforms by the current government.

The GST acted as a game-changer for India to become a single market and the right time has arrived to take disruptive ideas of all kinds in the right sense, as all of them were aimed at the overall development of the nation, he added.

He further said that increase in domestic consumption was possible lately on account of decline in inflation. Between 2014 and 2015, the inflation rates which were over 10 per cent moderated to 4.5 per cent over the last five years, he noted.

Recently, 108 economists had issued a letter raising doubts over the credibility of the data. They had said that data’s authenticity has suffered due to government influence. The had also called for restoration of ‘institutional independence’ and integrity of statistical organisations.

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