New Delhi: Bharatiya Janata Party’s (BJP) Member of Parliament, Nishikant Dubey, on Monday said in the Lok Sabha that the country’s GDP growth rate will not be relevant in the future.
"GDP was introduced in 1934. There was no such concept before that. You cannot consider GDP as the gospel truth. It is not Bible, Ramayana or Mahabharata. GDP will not remain very useful in the future,” said the Member of Parliament from Jharkhand’s Godda.
This comes days after India’s gross domestic product (GDP) growth rate slipped to 4.5% for the July-September quarter of the ongoing financial year. This is the lowest since the January-March quarter of 2013.
The GDP growth rate measures how fast the economy is growing. Simply put, GDP measures the economic output of a nation. The GDP growth rate is the most important indicator of economic health. When the economy is expanding, the GDP growth rate is positive.
If it's contracting, then businesses hold off investing in new purchases. There is delay in hiring new employees until there is confidence that the economy will improve. These delays further depress the economy. Without jobs, consumers have less money to spend.
“In current times, it is sustainable economic welfare of citizens that needs to be concentrated on. Instead of GDP, it is more important whether sustainable development is taking place. Happiness of everybody is more important,” he added.
India does not seem to be doing well in terms of happiness too. The world happiness report for 2019 placed India at the 140th position, down seven places from where it stood in 2018.
Meanwhile, this is the fifth consecutive quarter to have witnessed a fall in GDP.
The nominal GDP growth for the second quarter also fell to 6.1% as compared to 8% in the previous quarter. The GVA growth also dipped to 4.3% in comparison with 4.9% in the first quarter of the ongoing financial year.
Growth figures for the previous quarter had dipped to 5%, to an over six-year low. GVA growth too had fallen to 4.9% in the last quarter as compared with 6.9% in the same period last year.
The manufacturing sector also witnessed negative growth in the second quarter of the ongoing financial year. Once considered the backbone of the economy, the sector grew at -1% in the July-September quarter.
RSS Chief Mohan Bhagwat, in July, had also questioned the use of GDP as an indicator of the country’s economic health. GDP is a "faulty" parameter to judge economy, he had said.