The Indian economy is showing signs of improvement despite a challenging global environment, attributed to a series of reforms implemented by the government over the past nine years, according to Ashima Goyal, a member of the RBI Monetary Policy Committee (MPC). Goyal acknowledged the progress made but emphasized the need to unlock India’s full economic potential. She also compared the performance of the UPA government from 2004 to 2014 and the NDA government’s nine-year tenure, highlighting the NDA’s efforts in addressing deficits, inflation, and banking issues, leading to improved economic conditions.
Addressing concerns raised by some US-based economists about India’s reported economic growth, Goyal emphasized that over-analyzing quarterly results, which are influenced by seasonal factors and measurement complexities, is unwarranted. She explained that the high Q1 growth in FY24 was largely due to the base effect following a sharp decline in growth during the pandemic in FY21. India’s economy has demonstrated resilience and robustness, with growth rates remaining strong, and various data indicators supporting this positive trend.
Goyal countered claims by certain US-based Indian-origin economists who argued that India’s growth slump in the 2020s was due to fundamental flaws. She highlighted India’s remarkable post-pandemic recovery, which has disproved these assertions. Goyal stressed that India’s growth is sustainable, attributing it to economic diversity, resilience, and effective policy measures.
The Finance Ministry echoed similar sentiments, defending the accuracy of India’s GDP estimates and pointing to other economic indicators, including purchasing managers’ indices and capital expenditure, as evidence of robust growth. The debate around India’s GDP calculation methodology was also addressed, with some experts suggesting a focus on the expenditure side, while others favored the productivity side.
India’s economy has made significant strides in the face of global challenges, with policymakers and economists defending the credibility of its growth figures and emphasizing the country’s economic potential and resilience.