Investment figures, manufacturing weaker than expected

The new macroeconomic data released by the government last Friday, which showed joblessness for 2017/18 at 6.1%, a 45-year high, was not factored into the World Bank Group’s June 2019 Global Economic Prospects (GEP) report, Ayhan Kose, Director of the Bank’s Global Prospects Group told The Hindu , during a briefing call with reporters.

“This data is rather new. Obviously we have not [taken] it into account … our cut off date for the data as we indicated in the report is May 23 [2019]. Having said that, India’s GDP growth slowed to 5.8% in the first quarter [of 2019] from 6.6% in the previous quarter,” Mr. Kose said. “Manufacturing activity and investment figures were weaker than expected.” This, Mr. Kose said, was attributable to the uncertainty in the run-up to the elections and was “somewhat expected.”

India’s growth forecasts are projected to be 7.5% per annum in 2019, 2020 and 2021 — not having been downgraded from their January estimates. A growth rate of 7.2% is estimated for 2018. In its 2014-2019 term, the NDA government had faced criticism over its handling of data. For instance, the unemployment data from the National Sample Survey Office, leaked in January, was officially released only last week, post-elections. In January, the Ministry of Statistics and Programme Implementation published revised GDP growth numbers for 2017, showing an increase of 1.1%, with growth pegged at 8.2%.

In March, 108 economists and social scientists from around the world, wrote an open letter ‘Economic Statistics in Shambles’ to highlight the data credibility problem.

World Bank representatives did not wish to comment on the data credibility issue during Tuesday’s briefing call.