New Delhi, NOV 29 :
India’s recovery from global financial crisis took longer than previously thought
India’s GDP growth never crossed over into a ‘high-growth’ phase of above 9% in the last decade or more, new back series data from 2004-05 released by the government on Wednesday show. The data also show that India’s recovery from the global financial crisis took longer than previously thought.
The government, in 2015, changed the methodology and the base-year for the computation of its economic performance, moving towards a Gross Value Added (GVA) method from the earlier GDP calculations and bringing forward the base-year to 2011-12 from 2004-05. This, however, meant that the newer estimates could not be compared with the older data. The back-series release on Wednesday provides the growth estimates for previous years using the new methodology.
The new data release shows that GDP growth during the UPA years averaged 6.7% during both UPA-I and UPA-II. The old series had pegged these at about 8.1% and 7.46%, respectively. In comparison, the current government has witnessed an average GDP growth rate of 7.35% during the first four years of its term.
“The major takeaway from the data is that the economy doesn’t seem to have recovered from the global financial crisis as quickly as previously thought,” former Statistics Secretary and Chief Statistician of India TCA Anant told The Hindu. “That is something we should look much closer at.”
“There was a general point about the manner in which we did the old computations which was generally very insensitive to current data,” Mr. Anant added. “There were a number of ways in which the old series computations simply did not measure current changes quickly enough, which the new series in fact does.”
The other element is that the behaviour of the mining sector, which not only affected the mining sector but also trade segment, are elements in it,” Mr. Anant said. “Remember the de-coupling happened… there was a collapse in mining which happens more or less immediately post the financial crisis.
