Why in news?
The National Statistics Commission (NSC) is working on various alternative measures for back-casting GDP series.
What is the GDP status of India?
- The International Monetary Fund (IMF) recently reported that India continues to be the fastest growing economy.
- India has expected growth rate of 7.3 per cent for the current year and 7.5 per cent for the next.
- Indian agriculture contributes about 16 per cent to India’s GDP by employing nearly half of the working population.
What are the shortfalls with understating GDP?
- An increased share of agriculture to GDP does not necessarily mean that farmers will have a better tomorrow.
- For instance - There might be two paddy growing farmers, who help each other in their sowing activity by lending free labour, which is outside the purview of GDP calculation.
- Increasing GDP of agriculture can happen with absolutely no increase in the farmer’s income or their well-being.
What areas needs to be taken care?
- The agriculture sector is largely underemployed and inefficient, with the right practices, the same amount of food can probably be grown with half the people working.
- But, by consciously developing rural enterprises, nurturing them and celebrating their success, India can possibly gainfully employ more of the population in agri-value-chain activities.
- It is imperative that small farmers get end-to-end support in farming and post-harvest management with the right people and physical infrastructure backing them.
Source: Business Line