An Objective Perspective of Current India’s Economy State
A Look at Government’s Greener Perspective Versus Underlying Economic Complications
When we approach an election year, interim budgets tend to be crafted with political motivations in view. In such periods, budget speeches turn into platforms for excessive self-promotion, with the ruling government emphasizing its achievements and unveiling promises of future benefactions and opportunities. A new practice has been employed by India’s financial body, preferring to release a document called “The Indian Economy: A Review” as opposed to the typical Economic Survey, a deviation likely due to imminent elections. Not surprisingly, the review, released recently, reads like a laurel for the current government’s competent economic handling, while subtly glossing over long-standing economic issues. Consequently, one could interpret this paper as an electioneering instrument aimed at pandering to the ruling party’s middle-class supporters and consequently harmonizing with the interim budget’s electoral manifesto.
Scratching beneath the Surface of Economic Glitter
While governmental reviews have their merits, a candid economy evaluation would have been a more effective balm for the prevailing geopolitical and economic anxieties. The problem with this particular review is not so much about dishonesty, but a seeming avoidance of core economic issues. For example, the document’s celebration of a booming economy amidst worldwide struggle ignores two key observations. Firstly, the predicted nominal GDP growth for 2023-24 is lower than anticipated, a scenario that could trigger a series of repercussions. And secondly, the review does not satisfactorily address mounting concerns over GDP overestimations or some underlying issues in computing the GDP deflator, leading to discrepancies in output estimation methods.
Overlooked Concerns and Selective Data Reference Tactics
A major concern is the review’s apparent disregard of the looming unemployment issue. Using the government’s recently published Periodic Labour Force Survey data, the review enthusiastically highlights expanding job openings and diminishing unemployment. However, it conveniently omits critical data from independent sources such as the Centre for Monitoring Indian Economy that forecasts a 9%+ unemployment rate for November 2023. The issue on slow job creation remains a concern as acknowledged by Bibek Debroy, chairman of the Economic Advisory Council to the Prime Minister, in an interview to our source. Interestingly, the review refers to a 2023 paper asserting India’s 22.6% share of the world’s GDP in 1700, rather than directly citing the work of British economist Angus Maddison. Despite its reference to the paper for this fact, there is no mention of the paper’s emphasis on the growing unemployment and issues relating to inferior-quality economic development.
Escaping Traditional Constraints and Seizing the Opportunity
It would have been more beneficial if the review had adopted a realistic and comprehensive analysis of the economy, in keeping with a democratic culture of full disclosure to empower citizens with unbiased information for optimal decision-making. Although the government should be admired for taking an innovative approach by departing from the normative path, it has largely wasted a golden opportunity to present an inclusive and honest review.
