Business Economy

131 CAs refute economists’ claims on GDP base year revision

A group of 131 chartered accountants have sought to debunk recent claims made by a group of economists that the government was suppressing uncomfortable data and had eroded the integrity of national data.

The 108 economists, had last week, written a letter in which they cited the revision of the base year for the estimation of GDP numbers as one major issue, among a few others.

“It may have skipped their [the economists’] mind but the base years of the National Accounts Statistics series have been changed in August 1967, January 1978, February 1988, February 1999 and 2006,” the statement issued by the chartered accountants, who include notable names such as Nilesh Shah, MD, Kotak AMC, Nirmal Jain, Founder and CMD, India Infoline, Vallabh Bhansali, Founder Enam, T.V. Mohandas Pai, and several former chairmen and presidents of the Institute of Chartered Accountants of India, said.

“The rebasing exercise which led to the change in GDP growth rates — the base year was changed from 2004-05 to 2011-12 — was set in motion by the UPA,” the statement added. “The methodology for this was also approved by the UPA; that the numbers came out under NDA is just a coincidence.”

The chartered accountants pointed out that the new GDP series in India was the first that was compliant with the United Nations guidelines in the System of National Accounts, 2008, and that it was more robust than previous iterations because it sourced data directly from the corporate sector and had better estimates for unorganised sector activity.

The accountants highlighted the rate of infrastructure creation, job creation in the service sector, implementation of the GST, improvement in financial inclusion, improvement in the World Bank’s Ease of Doing Business rankings, and increase in foreign direct investment as signs of rapid economic growth. “All this has helped India become the sixth largest economy in the world, the fastest ever jump, in the last five years.”


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