Indian RBI Economy

Problems in counting the Indian GDP according to RBI Governor

The Indian GDP riddle

RBI Governor Raghuram Rajan said that there is a problem with the way we count GDP.  The central statistics office (CSO) is officially responsible for sharing GDP data. CSO rolled back the GDP estimates in FY 2014 from 6.6% to 6.4%.  Also in FY 2015 from 7.3 to 7.2 %.  Previous years Economic Survey showed balance and caution that implicated a recovering but not a surging economy. EPW(Economic and Political Weekly) hosted  debate and it all comes down to this – If India is indeed growing fast, then no need for Fiscal Stimulus by government. Also from the other view point, if “a counter-cyclical ” policy is needed then the estimates of 7% growth rate are not at all in accordance with the reality.

RBI governor does not want exchange rate to be changed

Mr. Raghuram Rajan holds a belief that devaluating the rupee against dollar will only lead to further problems. His notion is in conflict with those who ask RBI to lower rupee value on the lines of Korea and China. ‘Devaluation is not the intention of RBI‘ he said.

The Supreme Court of India bench Justice TS Thakur has asked RBI to give the list of defaulter in the collective debt of 500 crore  Rupees.  This has been the activity done by Supreme Court after a PIL (Public Interest Litigation) was filed. The results revealed a massive Debt write off. To the tune of 1.14 lakh crores of bad debts. National banks like the State Bank of India and Bank of Baroda including PNB (Punjab National Bank), and many other nationalised banks have written off large loans after loan takers declared default. Now RBI has to give supreme court, the list of all those defaulter companies, whose loans over 100 crore were written off. It is to be noted that many people allege that banks managers are involved in the scam and writing off is a mere way to use the money else where, after company going bankrupt.

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