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Modi Defends 7.8% Growth as Critics Question India’s GDP
Prime Minister Narendra Modi said India’s economy is growing strongly.
Government figures say it grew 7.8% from April to June compared with the same period a year earlier.
Modi said this showed India had moved beyond the weak economic reputation it had in 2013.
Some experts questioned whether the number gives a complete picture.
Subhash Chandra Garg said changes to earlier GDP numbers made the latest growth rate look higher.
Raghuram Rajan said his concern was not about accepting or rejecting one specific figure.
Instead, he asked why strong growth had not created more good jobs and investment.
The statistics ministry said its new method was carefully prepared and more accurate.
The Congress party used the criticism to attack the government’s economic claims.
Prime Minister Narendra Modi defended India’s reported 7.8% April-June GDP growth during an address at Shri Ram College of Commerce.
Modi contrasted India’s current economic performance with its 2013 “Fragile Five” label and earlier “policy paralysis.”
Former Finance Ministry official Subhash Chandra Garg argued that revisions to the comparison base overstated the reported growth rate.
Former central bank governor Raghuram Rajan questioned why strong growth had not produced more private investment, foreign investment, and decent jobs.
The Ministry of Statistics defended its revised GDP methodology, saying it followed extensive consultations and better measured economic activity.
- Who
- Prime Minister Narendra Modi, Subhash Chandra Garg, Raghuram Rajan, the Ministry of Statistics, and the Congress party.
- What
- A dispute over India’s reported 7.8% quarterly GDP growth and what it says about the economy.
- Where
- At Delhi University’s Shri Ram College of Commerce and in subsequent public statements and briefings.
- When
- The figures were released Monday; Modi spoke at SRCC’s centenary celebrations on Saturday, according to the article.
- Why
- Modi cited the growth as evidence of economic strength, while critics questioned the effect of GDP revisions and the lack of stronger jobs and investment.
Government and Modi’s defense
Critics’ questions
Reliability of the growth figure
Government and Modi’s defense
The government stood by the 7.8% figure and said its revised GDP approach provided a more accurate picture of economic activity.
Critics’ questions
Subhash Chandra Garg argued that changing the previous year’s comparison base overstated the growth rate and cited a possible 2.6% current-price increase without the revision.
Meaning of strong growth
Government and Modi’s defense
Modi presented the figure as evidence that India had moved from 2013’s “policy paralysis” to policy dynamism and economic strength.
Critics’ questions
Raghuram Rajan said rapid growth should have produced stronger private and foreign investment and more decent jobs, while clarifying that he was not disputing the specific GDP estimate.
Political interpretation
Government and Modi’s defense
Modi said critics who once called India part of the “Fragile Five” were unable to digest its current performance as a fast-growing major economy.
Critics’ questions
The Congress party said public relations could polish the presentation of GDP figures but could not improve the underlying economy.
Key facts
- Reported growth
- India’s economy grew 7.8% in the April-June quarter from a year earlier.
- Reuters poll estimate
- The reported growth exceeded a 7.1% estimate from a Reuters poll.
- Revised nominal GDP
- The new series put April-June 2025 nominal GDP at ₹80 trillion, or about $850 billion.
- Previous estimate
- The same quarter had previously been estimated at approximately ₹86.05 trillion.
- Garg’s alternative calculation
- Garg said growth at current prices would have been about 2.6% without the downward revision to the previous year’s GDP.
- Government position
- The Ministry of Statistics defended the revised methodology as the result of extensive consultations and a more accurate measure of economic activity.
- Rajan’s concern
- Rajan questioned why sustained strong growth had not led to greater private and foreign investment or more decent jobs.
Quotes
Subhash Chandra Garg
Former senior Finance Ministry official who questioned the reported GDP growth calculation
“Today, those spreading terrorism are trounced. If Pakistan indulges in any nefarious act, the Indian army enters their home and strikes; the back of Naxalism has been broken...from policy paralysis to policy dynamism, India has come a long way”
livemint.com
“If you had not revised last year's GDP, the growth in current prices would have been 2.6 per cent”
livemint.com
Sources
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