GDP not impacted by demonetisation: Read what ‘experts’ had predicted

Finally, India’s GDP data for the quarter ended December 2016 is out. October to December 2016 was the quarter which included the demonetisation period, from 9th November 2016 to 31st December 2016. Various “experts” had given dooms day views regarding the demonetisation move:

Some termed it as “bad economics“. Some called it a “large shock to the Indian economy“. Some called it an example of “bad policy” Some suggested that India will face “dire consequences“. Some proclaimed that “The Deep Shock of Demonetisation May Devastate the Economy“. Some said that demonetisation would incur “high economic costs“. Some said “Demonetisation has turned India into world’s fastest slowing economy“. Some said “demonetisation may spell doom for the economy“.

The commentary was overwhelmingly negative, except for a few bright spots here and there. But most of the above commentary was in the form of abstract, immeasurable comments. To really objectively analyse this commentary, we need measurable predictions. And we did get them. Everybody who knew how to speak in English, began commenting on India’s GDP prediction. Here is what various people and agencies said:

- Advertisement - - Article resumes -

The “economist” former Prime Minister of India, Manmohan Singh had spoken after a long time, to claim that demonetisation could shave off 2% from the GDP rate.

Ambit Capital, predicted “a distinct possibility of GDP growth contracting in Q3FY17″ and said that the annual GDP growth rate could fall to 5.8 % year-on-year (from 7.3 percent).

An HSBC report predicted that India’s GDP for the December quarter could fall down to 5%. For reference, India’s GDP rate was 7.4% for the earlier quarter, and was 6.9% for the same quarter last year.

Another HSBC report quoted by media suggested that GDP would fall by 1%.

Estimates of Associated Chambers of Commerce and Industry of India pointed to a contraction of 2.5 % of the GDP

Analysts polled by Reuters had expected a 6.4% growth rate in the quarter to December.

Various other GDP predictions can be read here.

To cut things short, the GDP predictions ranged from a low of 5% to a maximum of 6.4%. But the final data which came out yesterday proved to be egg on the face of all of the above. India’s economy grew at a healthy 7% in the fiscal third quarter. It was also higher than China’s 6.8 percent growth for the last three months of 2016. India’s GDP rate was also higher than BRICS nations:


One of the few who got the forecast almost bang-on was economist and columnist Rupa Subramanya, who had predicted a minor 0.4-0.5% correction:

Now that the hard numbers have slapped some analysts on the face, the first reaction is pure disbelief. Even GDP numbers are being doubted now, and more such “doubts” will emerge, since the data doesn’t match their predictions.

“I am totally surprised and stunned to see this number. Perhaps this data is not capturing the impact of demonetisation,” said Aneesh Srivastava, chief investment officer, IDBI Federal Life Insurance Co. Reuters, whose poll got the prediction wrong, went on to doubt the credibility of the data. Excuses are being bandied about that the Government will have to eventually revise the data. Congress on its part has even begun trending a hashtag “#ModiFudgedGDP”.

Next, one may expect media hit jobs on the GDP data as well. For example, last year, media reports claimed that India had admitted “errors” in its GDP data. The fact remained though that economic illiteracy had led to this foolish claim, which we had destroyed here.


Share This Post and Support:
We need your support to survive in the media industry. Please consider paying us for the content we produce:

To know more about these payments, please click here.


Most read articles recently

How Ravish Kumar and Vinod Dua misled people about ‘martyr status’ to CRPF jawans after Pulwama attack

How Ravish Kumar and Vinod Dua misled people about ‘martyr status’ to CRPF jawans

Ravish Kumar of NDTV is a man known for many lows. But this may well be his lowest point.
Days after Pulwama attack, Kamal Haasan toes the Pakistan line

Kamal Haasan demands ‘referendum’ in Kashmir, terms Pakistan Occupied Kashmir as ‘Azad Kashmir’

Days after Pakistan sponsored Pulwama attack, Kamal Haasan has echoed the sentiments of terrorist state Pakistan when he sought a 'referendum' in Jammu and Kashmir

Pakistan quotes The Quint, Karan Thapar and Praveen Swami to brand Kulbhushan Jadhav as a ‘RAW spy’ at ICJ

Pakistan quoted several articles published in Indian to present its case during Kulbhushan Jadhav hearing at the International Court of Justice

The Hindu not only cropped the Rafale dissent note, but also had digitally manipulated it

Comparison of Hindu document with ANI document shows that Hindu had doctored the Rafale dissent note

Man whose number was made public by Barkha Dutt for stalking, claims he is getting threatening calls, says didn’t abuse Barkha

In her tweet, Barkha demanded the Home Minister of the country, Rajnath Singh, himself intervene in the matter which is routinely dealt with by local Police.

Kavita Krishnan uses 4 year old photograph to claim PM Narendra Modi was laughing after Pulwama attack

Using a old photo, Kavita Krishna claimed the Modi was having fun at election rallies after Pulwama attack

Meet the people whose main concern is if Modi may ‘benefit’ due to terror strike, not tears of martyrs’ families

While the Country held its breath and read gut-wrenching stories of the Jawans martyred in the Pulwama attack, the 'liberals' were more concerned about politics than the tears of the martyr's families.

Imran Khan’s deranged statement on Pulwama terror attack tailor-made to appeal to Indian ‘liberal’ sensibilities

In his statement on the Pulwama terror attack, Imran Khan claimed that his country had nothing to gain from attacking India. Apart from that, he threatened India with retaliation should the Indian Army decide to attack Pakistan.

JNU ‘student’ who was accused of stealing funds in Kathua case found spreading rumours about Kashmiri girls trapped in Uttarakhand

CRPF also issued a notice that certain 'miscreants' on social media are spreading rumours and hate on social media

Pakistan funded Islamic terrorist blows up 300 kgs of IED, actor brings ‘Hindu right wing’ argument to shield Pakistan

Jaaved Jaaferi refuses to hold Pakistan accountable for the attack, instead equates Hindus with Jaish Terrorists.

Latest articles

Connect with us

137,517FansLike
110,474FollowersFollow
23,139SubscribersSubscribe

Don't miss these