KV Kamath says economy growing at 11%

Discussion in 'Economy & Infrastructure' started by thakur_ritesh, Jul 10, 2011.

  1. thakur_ritesh

    thakur_ritesh Administrator Administrator

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    BANGALORE: The Indian economy is growing faster than the officially quoted 8%-8.5% GDP growth rate, said KV Kamath, the newly appointed chairman of Infosys Technologies.

    At a meet-the-press event here on Saturday, Kamath said India is actually growing at 11%-12%. Kamath said the economic data used to compute growth rates are not accurate. "As long as we don't have the right statistics, there is a question over the growth rate," he said.

    There are several uncounted and unaccounted figures which could easily add another 3-4 percentage points to India's GDP, he said. India, he said, is thus growing at the double-digit rates we have become used to seeing in China in recent years and Japan in the 1980s. As for India's per capita income, Kamath said India stands where China was 10 years ago, and in the next 10 years, it will stand at where China's per capita income stands today. Kamath said for this growth to be truly transformational and benefit a larger proportion of the masses, India has to put more emphasis on certain areas.

    The manufacturing sector must further expand as it has the capacity to generate large-scale employment. Infrastructure bottlenecks must be addressed as they hinder development.

    Also, consumer demand must be kept robust to drive the economy. He said technology too could help in greater percolation of benefits to the poor. The use of the unique identification platform for cash-transfer schemes using Aadhaar-linked bank accounts would prevent leakages in subsidy programmes like LPG and kerosene. On the high interest rate environment, Kamath said the most affected would be retail customers who take home loans, auto loans, etc. Businesses can tide over these times with internal accruals, he said.


    KV Kamath says economy growing at 11% - The Times of India
     
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  3. p2prada

    p2prada Stars and Ambassadors Stars and Ambassadors

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    The economy is growing beyond 15%, but inflation is keeping it all back at 8%.

    Reduce inflation and even 12% growth is possible.
     
  4. Rahul92

    Rahul92 Senior Member Senior Member

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    I strongly believe that Manufacturing sector holds key to higher growth than our present backbone of service sector
     
  5. thakur_ritesh

    thakur_ritesh Administrator Administrator

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    mr kamat is referring to the the methodology used to do the calculations. if we were to use a methodology similar to one used by the chinese (i presume), we would derive at a much larger growth rate than one being put forward by the government, where he is putting in a rough estimate of real growth rate at 11-12% for the just gone by fiscal and if these were to be done starting from a certain specific time period, let us say from the year which is used as a base year, though we should go back much further, then the size of economy would again be much bigger than the quoted rs73,06,990crs.

    interestingly the methodology being put forward here can be disputed on various accounts but coming from someone like mr kamath, could the government be looking to revise the methodology used? there is an already on going debate on this within the economic planners of the country.
     
  6. Yusuf

    Yusuf GUARDIAN Administrator

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    What is interesting is that Kamat has disputed the methodology of calculating the growth. So that means the actual growth not only this year but many preceding years should be disputed. Which means Indian economy should be well past 2 trillion.

    I agree with his assessment that manufacturing holds the key and I too have been saying the same for years that India has to invest in manufacturing and look at being the next "china" in manufacturing. It can only happen if the government stops being an impediment to it's growth and come up with pro manufacturing policies. I know it from first hand experience as even getting something as basic as sanction for electricity is filled with problems, red tape and bribes. Let me not even get started on getting land in an industrial area.

    We have all the "credentials" apart from govt policy to be a manufacturing powerhouse. Skilled, educated labor and abundant labor, people who are ready to work their arses out, availability of capital, good credit rating and big investors and industrialists ready to pump in the money. We are a democracy as well!!

    We need the bloody govt policy and importantly bureaucracy to shape up.
     
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  7. Phenom

    Phenom Regular Member

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    I'm Confused
    If the methodology of the GoI is wrong then what about the IMF and WB, IIRC they also predict India's growth at 8-8.5%.
     
  8. Godless-Kafir

    Godless-Kafir DFI Buddha Senior Member

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    It still beats me why people go to China instead of India. Its probably the democracy that is failing the business!
     
  9. Yusuf

    Yusuf GUARDIAN Administrator

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    Not democracy but bad policies, red tape etc that does.
     
  10. The Messiah

    The Messiah Bow Before Me! Elite Member

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    How long since you've been to any sarkari office ?
     
  11. sky

    sky Regular Member

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    If he is right why does the GOI not widen the tax paying pool,i read some where only 1or2 % of workers pay tax? If this is correct and the economy is bigger then suggested may be more people should be paying there fair share to the tax dept.

    I keep reading about India's widening fiscal deficit .This could be reduced so by making India more stable to the financial markets ,so the make the big infrastructure projects India needs to complete going forward can become a reality sooner ..
     

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