The Central Statistical Organisation (CSO) seems to have come in the firing line of the government. Barely days after CSO came out with a GDP growth forecast of 5 per cent for the financial year 2012-13, finance minister P Chidambaram termed it an extrapolation of a dated data by the statistical body. He added that the economy is expected to clock a growth rate of around 5.5 per cent this fiscal. The minister also exuded confidence that the measures taken by the government in the recent past and those that will be taken in future will bring the economy back to 8 per cent growth path.
“I and many in the government believe that the data on the basis of which CSO reported growth rate of 5 per cent is rather dated data,” said Chidambaram in Mumbai on Saturday while addressing the gathering both at the launch of MCX-SX and the Rajiv Gandhi Equity Savings Scheme.
“CSO extrapolated data for the period April to November 2012 for the year which normally would be correct when the trendline continues in the same direction but when trendline changes, extrapolation is not the method that a statistician should follow to project the future.”
While the economy is not as robust as it was few years ago, the finance minister said that he is confident that it will come out of the trough and climb back to a high growth path. He said that the upturn has started and there are green shoots to be seen in the second half of the fiscal.
He said that a 7 per cent growth rate is imperative to maintain the existing levels of employment and a 8 per cent growth rate is imperative to absorb jobseekers. The minister said that the measures taken by the government in the last 3-4 months and the ones that they plan to implement in coming months will put India back on the 8 per cent growth path.
“It is possible to get back to that growth path provided we follow prudent and sound policies, invest in our economy, stimulate demand, encourage entrepreneurship and risk taking and grow the economy at a pace and a rate which is imperative to the welfare of Indian people,” Chidambaram said.
He even called for Indian investors and companies to rediscover faith in the economy while saying that in his meetings with investors overseas he figured out that they have greater faith in the Indian economy. He said foreign companies are willing to explore opportunities to invest in India even as Indian companies are looking for opportunities to invest abroad.
“I think we need to rediscover faith in our own economy. We can do the magic of 2004-2008 when the economy grew at an average of 8.5 per cent,” he said.