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Discussion Forum : Chidambaram and Modi are sparring over growth figures. Who is correct? | Business Standard
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3yrs 13weeks 5days 6hrs 22mins ago | COMMENTS [23] | Politics

Chidambaram and Modi are sparring over growth figures. Who is correct?

The finance minister says the BJP Prime Ministerial nominee's claim that economic growth rate during the tenure of the Atal Behari Vajpayee government was 8.4% a year on average. Calling Modi's claim a 'fake encounter' with facts, Chidambaram says the average annual growth for the six-year NDA period stood at 6% and that for the last five years at 5.9%. Obviously one of the two is wrong. Is it Chidambaram or Modi? Do share your views with us.

Nobody is correct. Chidambaram a seasoned politician and know how to twist figures to suit his advantage. We public suffered most whenever they ruled, whether it is before emergency or after emergency, price rise of essentials will prove it. They have ruled India 51 years. What they have done except getting benefit for corrupt fellows at the cost of public. Even now they are trying to help criminals to fight election. Modi is new for Centre and we will have to wait and see. There is nothing wrong in having a change.
Thursday 26th of September 2013 06:40:42 AM
The GDP growth rates during the three prior years to NDA were 7.29, 7.97 and 4.30 percent for 1997-98. So a high growth rate above 7 percent for a year or two was not something new to Indian economy. The growth rates during the six years of NDA were 6.68, 7.59, 4.30, 5.52, 3.99, and 8.06 in 2003-04. That gives an average of 6 percent p.a. The claim that the NDA took the growth rate to 8.06 (not 8.4 as stated in the media) in the last year was fallacious as it was computed on the base of a low growth rate achieved in the previous year, due to a bad monsoon. Therefore to say that the economy was taken to a higher growth trajectory by the NDA is misleading. To give an example let us assume that the food grains production was growing at 3 percent p.a and had reached say 200 mmt in year-1. In year-2, due to bad monsoon it comes down to 150 mmt- a reduction of 25 percent. If in year-3 it goes back to 200 mmt, the growth in food grains production for that year would be recorded as 33 percent. Consequently its effect would be reflected in the overall growth rate for the year. But all that happened was normalising the food production with no growth from the trend line. The actual food grains production in the last three years of NDA rule was 213 mmt, 175 and back to 213 mmt in FY 2004. So it is to be noted that the growth rate of 8.06 percent achieved in FY2004 includes the apparent growth in production of food grains by 22 percent from 175 to 213 mmt in that year. The growth rates in the first seven years of UPA were impressive, exceeding 9 percent in four of the years; but lately it has fallen to 6 percent and to 5 percent in the last two years. The fall in the year FY 2013 should be considered in the light of an already reduced growth in the previous year. UPA during the nine-year period has doubled the GDP from the level it took over when the economy had already grown by 42 percent during 1998-2004. The benefits arising out of such in doubling the GDP cannot be undermined. But that does not explain why the growth rate should fall from 9 percent to 5 percent. Surely there were opportunities lost. The NDA undertook a couple of landmark initiatives like mobile revolution and Golden Quadrilateral, from which the UPA benefited. The oil prices during the NDA period were subdued but flared up during the UPA. Though this was the main cause of the fiscal deficit, trade/current account deficit, it did not take enough measures to reduce the fiscal deficit by passing on the increased cost of oil to the consumers, fearing a backlash from the public and thereby causing considerable damage to the economy.
Wednesday 25th of September 2013 02:12:13 PM
WE CANNOT RELY ON UPA MINISTERS THEY HAVE FAILED TO GAIN CONFIDENCE OF CITIZENS WHEN OUR PM SAYS I AM NOT WACHTMAN TO LOOK AT THE MISSING FILES MODI IS RIGHT IN ALL DIRECTIONS CONG SHOULD NOT GET A SINGLE SEAT IN LS POLLS INFLATION IS PURELY BECAUSE OF CONG GOVERNMENT STOP THESE PARTIES
Wednesday 25th of September 2013 12:25:02 PM
unnecessary nuisance is making India weak please stop it.
Wednesday 25th of September 2013 10:09:50 AM