Responding to questions on the concerns of former Finance Secretary Subhash Chandra Garg regarding the calculation of GDP, Singh said that changing the base year and updating the method is a normal process, which countries adopt so that economic data can provide information about emerging trends and developments.
“As far as I know, the allegations being leveled against the government are completely baseless,” Singh said.
He said that as new data becomes available and new forms of economic activities emerge, countries keep changing the base year for calculating GDP from time to time.
He said, “The purpose of such changes is to understand more accurately the changes in the structure and functioning of the economy.”
According to Singh, the recent changes made by the government should not be seen as an attempt to manipulate economic data. Instead, he described the process as an attempt to make GDP estimates more robust and comprehensive.
He said the changed GDP methodology incorporates more data and a wider range of economic sectors, thereby better reflecting changes in the economy. Singh also linked the latest GDP growth data to India's improved sovereign credit rating.
He informed that India has again achieved 'A' credit rating after a gap of 38 years. He said India was an 'A'-rated country in 1988, but lost this rating in 1991 and had to wait till 2026 to get back into this category.
Singh said it is especially important that the credit rating improvement and the latest GDP estimates come at the same time. Based on the new calculation method, the Indian economy is growing at the rate of 7.8 percent.
He described the simultaneous occurrence of India's credit rating upgrade and strong GDP growth forecast as a “happy coincidence” and said that both these events show the internal strength of the Indian economy and its ability to overcome difficulties.