New Delhi, 15 October (H.S.): The International Monetary Fund (IMF) has endorsed India’s revised methodology for estimating its economic output, stating that the updated approach to calculating gross domestic product (GDP) is consistent with best practices and fully aligned with the IMF’s recommendations.

Krishna Srinivasan, Director of the IMF’s Asia and Pacific Department, made the remarks during a press conference in Bangkok on Thursday. He described India’s revision of the base year for GDP calculations as a “welcome step”. He noted that India had also issued an explanatory note outlining the changes introduced to its GDP estimation methodology.

Srinivasan said India’s efforts to improve its GDP statistics were in line with sound statistical practices. While there was always scope for further improvement, he stressed the importance of acknowledging the commendable work undertaken by the Ministry of Statistics and Programme Implementation (MoSPI) to enhance the quality of GDP data.

In its recently released Regional Economic Outlook for Asia and the Pacific, the IMF identified India among the emerging economies whose currencies had come under pressure following the energy crisis. The report observed that these pressures had eased somewhat in recent months. It also included India among the economies that had intervened in foreign exchange markets.

Political Controversy Over GDP Growth Figures

The endorsement comes amid a political controversy over India’s GDP growth figures for the April–June quarter, released by the government in September. The economy recorded a stronger-than-expected growth rate of 7.8 per cent, prompting debate over the reliability of the figures.

Former Finance Secretary S. C. Garg questioned the data, alleging that the growth rate had been artificially inflated by lowering the figures for the previous year.

India’s Chief Economic Adviser, V. Anantha Nageswaran, criticised Garg’s approach, describing it as an attempt to selectively use statistics to support a particular argument.

Nageswaran explained that the financial year ending in March 2023 had been adopted as the new base year for compiling the latest GDP estimates. As a result of the methodological changes, quarterly GDP figures for the previous year had also been revised.

The IMF’s endorsement of India’s revised methodology adds international support to the government’s efforts to improve the country’s national accounting framework, even as the debate over the interpretation of economic growth data continues.

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Hindusthan Samachar / Jun Sarkar