We must focus on human development, not GDP growth
- Official statistics may point to an economic recovery but people’s actual conditions have worsened
- The fact that GDP data hardly captures the real extent of depressed economic activity in the informal sector makes it irrelevant to a large population dependent on these activities
Estimates of gross domestic product (GDP) for the first quarter of fiscal year 2021-22 were released on 31 August. These were much anticipated, given that the first quarter of last year had seen unprecedented decline in GDP at 24.4%. This year’s first-quarter estimate was below expectations at 20.1%. Much of the discussion that has followed focused on whether the recovery has compensated for the loss of GDP, but also on whether the outlook for coming quarters is likely to be sustained. On both counts, there have been worrying signs based on several high-frequency indicators.