Statistics for the great unwashed.

The second quarter GDP growth came in at 7.1%, sharply lower than  the 7.5% economists had estimated, though industrial production and investment demand were up. This was predicted because the growth of 8.2% in the first quarter was based on high private consumption at 54.9% of GDP and a trade deficit of Rs 1.14 trillion in June. To maintain a high growth rate the government has increased spending, already breaching the fiscal deficit target of Rs 6.34 trillion, or 3.3% of GDP. The fiscal deficit at the end of October was Rs 6.49 trillion or 103.9% budgeted for the whole year. Of course, the deficit could be made up by higher revenue collections in the four months to the end of the financial year but that seems difficult with GST collections expected to be short by Rs 1 trillion. The base year for calculating GDP was changed from 2004-05 to 2011-12 in keeping with international practice. This is because types of industrial production and services keep changing as technology evolves. However, the government did not provide figures for comparing GDP growth from 2004 to 2012 with growth thereafter. So, a panel led by Prof Sudipto Mundle calculated that GDP growth was higher during the Congress years, 2004-2014, than the 4 years of this government, albeit with higher fiscal deficit and higher retail inflation. Stung by this report the government released its own back series data which slashes growth during Congress years to 6.82% from the earlier 7.75%, and much lower than 7.35% clocked by the present government. This has resulted in enormous controversy, with the Congress accusing the government of cooking figures. Normally, GDP figures are released through press notes by the Central Statistical Office but this time they were released in a power point presentation by the head of Niti Aayog Rajiv Kumar. The back series was calculated using present weights which make them useless, wrote AV Desai. According to the Annual Survey of Industry (ASI) data industrial production and output were higher than GDP in the old figures but have been reduced in the present report, wrote R Kishore. "What was lost in all this was a sane and much-needed discussion on the merits of the assumptions and methodologies used, implications for sectoral growth, equity, job creation and so on," wrote M Bhusnurmath. Growth under the present government has come from increasing wages, rather than increase in profits, there is great distress in agriculture, and from much lower growth in earnings of companies, wrote A Mukherjee. SS Bhalla defended the new report, but then he is a member of the Prime Minister's Economic Advisory Council, along with members of Niti Aayog. Do people believe this flimflam? For those that follow news, K Shashidhar used Bayes' Theorem to show that people use apparently adverse evidence to strengthen their own beliefs. So why bother? Because politicians will use these figures to bluff the 'great unwashed'. Such contempt for the vote bank!