Former chief economic adviser (CEA) Arvind Subramanian has said India's latest Gross domestic product (GDP) numbers are 'absolutely mystifying' and difficult to comprehend. He said India's economy grew by better-than-expected 8.4 per cent in the final three months of 2023 - the fastest pace in one-and-half years. He said the NSO has also revised GDP estimates for the first and second quarters of this fiscal to 8.2 per cent and 8.1 per cent from 7.8 per cent and 7.6 per cent, respectively.
Elaborating further, Subramanian said while the implied inflation in these numbers is 1 to 1.5 per cent, actual inflation in the economy is somewhere between 3 and 5 per cent. He pointed out that the economy is growing at seven and a half per cent, even though private consumption is at 3 per cent. And in the latest data, he said errors and omissions, which are not accounted for, are actually about 4.3 percentage points out of the estimated 7.6 per cent growth for FY24.
According to former CEA, while the buzz is that the economy has become a very good place to invest in, in the last few quarters, and last few years, it has actually declined very sharply. He said ‘you can see foreign direct investment actually collapsed quite a bit’. He wondered if India has become such an attractive place, why is not there more foreign direct investment. He said private investment, corporate investment is well below levels in 2016.
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