2/12/2015

BBCNewsIndiagrowthfiguresbaffleeconomists

INDIA
9February2015Lastupdatedat09:02ET

Indiagrowthfiguresbaffleeconomists
TheIndianeconomygrewby7.5%betweenOctoberandDecembercomparedwiththesameperiodayearearlier,
officialfiguressay.
Buttherewasconfusionregardingthestatisticsafterthewayinwhichthegrossdomesticproduct(GDP)figurewascalculated
waschanged.
Economistswarnedthefiguresneededtobetreatedwithcaution.
Growthforthepreviousthreemonthswasalsorevisedupsharplyto8.2%fromanearlierfigureof5.3%.
AndIndia'sstatisticsministryrevisedupitsforecastforannualeconomicgrowthto7.4%fortheyeartotheendofMarch.
Thatcomparedwithapreviousforecastof6.9%usingthenewformula,and4.7%beforetherevisedformulawasintroduced.
Thecountry'snewwayofcalculatingGDPhasbaffledanalystssinceitsreleaselastmonth.
Indiasaidthenewformulaisclosertointernationalstandards.Butanalystssaythenewdatadoesnotcorrelatewithother
economicindicators,includingindustrialandfactoryproduction.
Slowdown

Someeconomistshavesaidthelatestfiguresshouldbe"takenwithapinchofsalt"andexpressedscepticismoverthefiguresat
atimewhenIndia'scentralbankhasbeentalkingaboutaslowdown.
JyotinderKaul,principaleconomistatHDFCBank,alsoquestionedthe"credibility"ofthenumbers.
"Thereisclearlytheneedtolookatthecredibilityassociatedwiththesenumbers.Nothingonthegroundhassubstantially
changedtoshowthatweareoutofthetrenches,"hesaid.
"Myviewisthattheeconomyiscertainlymakingitswayup,butnoneoftheotherindicatorssuggestthatwehavecompletely
madeourwayoutoftheditches."
Indiawasbelievedtobeinthemidstoftheworsteconomicslowdownsincethe1980swithbelow5%growth,alevelthatwas
consideredtobetoolowtogeneratejobsformillionsofyoungpeople.
IndianPrimeMinisterNarendraModiwonlastyear'sgeneralelectionsonapromisetoreformandrevivetheeconomyand
attractmuchneededforeigninvestment.
OptimismhasgrownunderthePrimeMinisterModi,butthecountryisyettoseeanyofthebigbangreformshepromisedto
revivetheeconomy.

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