If states’ revised estimates were to be aggregated, the national GDP would have grown by 3 per cent on a nominal basis which is contrary to the National Statistics Office (NSO) estimate of a contraction, the report said.
State GSDP numbers might undergo revision, the report said, applauding Rajasthan, Jharkhand, Odisha and Kerala for presenting more realistic picture of their economies in the revised estimates.
It said almost all the major states have now presented the budgets for 2021-22, in which the revised estimates for 2020-21 are made. To validate states’ GSDP estimates for this fiscal year, the economists created their own projection based on simulation of last few years’ performances.
They said if they take states’ GSDP estimates as given then the all-India GDP contraction would be significantly lower than what the NSO has projected, but if they add the value of GDP estimated as per the simulation to the remaining states for which GSDP numbers are not available, it takes up India’s 2020-21 GDP to Rs 209.5 lakh crore, up 3 per cent on nominal terms.
For some states we have found that there is significant gap between our estimates and revised estimates provided by these states for FY21. The prominent states where there is difference are: West Bengal, Uttar Pradesh, Madhya Pradesh, Karnataka and Tamil Nadu, it said.
Interestingly, even though these states are showing a rosy picture on GSDP numbers, the same is not reflected in tax collections. Karnataka, Madhya Pradesh, Uttar Pradesh have actually witnessed a revenue receipts de-growth from FY20 to FY21, the report added.
States’ GSDP actual estimates for 2020-21 might see a 7 per cent reduction if the numbers follow the official estimates for overall GDP. However, there is a distinct possibility of the government revising the overall GDP estimates upwards, which means states would not see this sharp downward reduction, it said.
But, it is for certain that 2020-21 actuals for certain states would not be this high and the next year budget will show downward revision in GSDP estimates, it said.