World Bank’s Neelkanth Mishra Defends India’s GDP Growth
NEW DELHI- Neelkanth Mishra, India’s Executive Director at the World Bank, on September 3 rejected what he called “ill-educated and egregiously wrong claims made by some” that India’s GDP growth in the June 2026 quarter would have been much lower if the original base used for the June 2025 quarter had been retained.
Mishra’s comments on social media platform X came after former Finance Secretary Subhash Chandra Garg questioned India’s 7.8 per cent GDP growth for Q1 FY27, saying it needed closer scrutiny because the base year used to calculate growth had changed.
Mishra said the new GDP series, introduced in February 2026, “cleaned up the data and also significantly improved the methodology.” He added that the downward revision in the base was known in March and said the new series had increased the credibility of estimates of real output.
“That claim is so obviously wrong that several logical rebuttals have already been made. But bad information tends to travel further than good information, and so it is important to reiterate and reinforce the argument,” Mishra said.
Mishra also pointed to recent economic indicators to argue that momentum had strengthened beyond the June-quarter figures.
Personal vehicle dispatches, including cars and SUVs, grew 35 per cent year-on-year in August despite only 9 per cent growth in exports, he said. Two-wheeler growth was also above 20 per cent, although exports contributed to the increase.
Commercial vehicle dispatches grew more than 40 per cent, while tax collection growth also picked up, Mishra said. Credit growth, he added, continued to surprise on the upside, while indicators of construction remained robust.
Mishra said the recent data also suggested that the earlier weakness in credit growth had been linked more to supply constraints than to a lack of demand. He said those constraints had, for now, been addressed.
“And if that was consumption, commercial vehicle dispatches grew >40 per cent. Tax collection growth has picked up meaningfully. This is as real as it gets,” Mishra said.
He further said there would now be fewer questions about why private-sector investment was weak, given the evidence of investment activity.
Mishra, however, noted that there was still some slack in the economy, reflected in weak real-wage growth.
“It may take several quarters of above-trend growth for that slack to tighten, and bring back sticky inflation pressures,” he said.
The government has also rejected claims that the previous year’s Q1 GDP at current prices was revised down from Rs 86 lakh crore to Rs 80 lakh crore to make the current year’s growth appear stronger.
The Ministry of Statistics and Programme Implementation (MOSPI) said the Q1 GDP estimate for 2026-27 was calculated using the new series, with 2022-23 as the base year. It therefore cannot be directly compared with the Rs 86 lakh crore Q1 figure for 2025-26 calculated under the old series, which used 2011-12 as the base year.
MOSPI said a valid comparison can only be made with the Rs 80 lakh crore figure calculated under the new series. (IANS)
