It’s odd. Car sales have been zooming, flights are now fully booked, new mobile and fixed line phone connections continue to be added: So what economists like to call high-frequency data tells the happy story of robust spending by Indian consumers.
These obvious trends are nowhere to be seen in the new numbers on gross domestic product, numbers released by the government on Tuesday. Consumer spending has barely grown—nor have private investment, government spending or net exports, the usual drivers of economic growth, despite a growth rate of 8.8%. Our Mark to Market column gives a complete picture of this bizarre national accounting.
India needs a better system of counting national aggregates. A lot is at stake. How many poor people are there? How many tribals? What is the real inflation rate? Good public policy needs strong empirical roots.