Nnew Delhi: World Bank Executive Director and former Chief Economist at Axis Bank Neelkanth Mishra on Thursday strongly defended India’s latest economic growth figures, describing claims that actual GDP growth was merely 2.6 per cent as “ill-educated and egregiously wrong”. His sharp rebuke comes amid an escalating debate over whether the newly recorded 7.8 per cent expansion in the April-June quarter was artificially inflated due to a downward adjustment in the historical base.
The controversy began following statements by former Union finance secretary Subhash Chandra Garg, who asserted that the previous year’s current-price GDP had been trimmed from approximately ₹86 lakh crore to ₹80 lakh crore. Garg contended that without this revised lower base, quarterly growth would have stood at only 2.6 per cent. Responding on social media, Mishra expressed astonishment at how such claims gained traction, explaining that comparing current-quarter figures against the pre-revision baseline reflects a fundamental misunderstanding of national accounting standards.
Mishra noted that the updated national accounts series launched earlier this year introduced significant enhancements to statistical methodology and cleaned up source data. He emphasized that the downward adjustment in the baseline was fully acknowledged and analyzed by economists months ago and serves to bolster, rather than diminish, the reliability of real output estimates. With fading fiscal headwinds and accelerating credit growth, he projected that consensus estimates for India’s trend growth rate could comfortably shift upward past seven per cent.
Highlighting ground-level economic health, Mishra pointed to robust, hard-to-fudge high-frequency indicators that demonstrate genuine expansion across sectors. He highlighted August dispatches showing a 35 per cent rise in personal vehicles, over 20 per cent expansion in two-wheelers, and more than 40 per cent growth in commercial vehicles, along with notable gains in tax collections, banking credit, and construction activity. While acknowledging that residual slack in real wage growth still requires multiple quarters of sustained momentum to tighten, Mishra maintained that underlying private investment and consumption remain definitively strong.
