If Modi Beat Manmohan’s GDP, Hindu Kings Outperformed Mughals

Video Editor: Mohd Ibrahim
Video Producer: Sonal Gupta
Cameraperson: Shiv Kumar Maurya

Prime Minister Modi loves to rewrite history, right? I mean, if Mahrana Pratap could shellack Akbar in the Battle of Haldighati, then perhaps it’s best to rework India’s GDP series all the way back to 5561 BC – ie, more than 7,500 years back – to prove that the growth we managed during the Mahabharata and under Hindu kings was higher, much higher, than what was logged under the Mughals.

I mean, just check out the new assumptions that the Modi regime has made to dampen the back data. There seems to be a much bigger design here than simply a “let’s beat the UPA government” objective:

Also Read: GDP Growth Drops To 7.1% in Q2 From 8.2% in Last Quarter

Telecoms

Since high-speed internet was deployed in the Mahabharata – but a technology-challenged Akbar replaced that with pigeon mail – Hindu kings shall win hands down in that sector.

Transport vehicles

The Pandava chariots in Mahabharata were equipped with laser and nuclear weapons. On the other hand, the Mughals used to ride clumsy, slow elephants. This one is in the bag too!

The Financial Sector

The barter system was prevalent during the Mahabharata. Since there is no change in the money supply under that dispensation – I mean, there’s no money at all – it’s inflation-proof. As against this, the Mughals used currency. So, the “inflation deflator” for the Mahabharata age will be zero. So no problem, Hindu kings shall beat the Mughals here too.

Informal Sector

Now, Hindu artisans were replaced by Muslims in the Mughal era. But since Muslims take five breaks every day for namaz (prayers), it would stand to reason that their productivity was lower than the Hindu artisans of the Mahabharata period. So gotcha, the Hindu kings win!

Economy Progresses, New Economic Variable Emerges

I’ve created the above satire to ram home the seriousness of the issue, not trivialise it. As new technology, global commercial rules, social mobility and income growth alter national economies, the relative importance of different variables changes.

For example, in an agrarian society with a per capita annual income under $100, people would eat coarse cereal and grain. But as countries and citizens become richer, say at annual income levels above $1,500 per capita, they begin to consumer much more fruit, milk and animal protein (meat). Necessarily then, you have to give a higher weight to these items to calculate food inflation.

Similarly, in 2005, a new telecom subscriber had to buy a handset (Rs 10,000), and pay a relatively higher amount for voice and data (say, Rs 2,000 per month).

So an individual subscriber represented a far more significant measure of economic output than minutes of data consumption (which was negligible when there were no iPhones, YouTube videos or Facebook).

But today, in 2018, in the multimedia and Reliance Jio digital era, handsets and voice calls have become free, while people are paying to consume gigabytes of data. Therefore, the unit of economic measurement should now switch to minutes or hours of data consumed.

But it would be wrong to superimpose a volume measure in 2005 to restate the value of India’s “telecoms GDP” for that year. That’s a clearly biased selection which shall underestimate the telecoms output in 2005 compared to 2018. And since the Modi government has used this device – and a million similar tweaks – to “recalibrate” the GDP under UPA downwards, what they’ve done is highly questionable, even plain wrong.

This dire conclusion is strengthened by several other real/objective/independent data points – corporate profits, investments, tax revenue, credit expansion, exports – which show the Manmohan government posting a much stronger performance than the Modi regime. It’s disingenuous to try and turn all of that hard evidence on its head!

Also Read: Jaitley defends GDP back-series data that slashed UPA-era growth rates

GDP Is Fixated on “more”, not “better”

In any case, the GDP of any country is a very fuzzy and imprecise measure of the economic well-being of its citizens; so, precious little will be gained by trying to game that data. GDP is always fixated on “more”, not “better”.

If more patients die in hospital, the GDP improves; but if everybody is healthy and never visits the doctor, GDP falls. If a car burns excess fuel and pollutes, GDP increases; but if its engine is efficient, GDP shrinks. If the education system is terrible and every student needs to take private tuitions, GDP increases. It’s perverse!

So Prime Minister Modi would be wasting his fast-depleting political capital in trying to “sell” this new economic data as his government’s grand achievement.

At best, he will get a few talking points which won’t matter to agitating farmers and unemployed youth. At worst, he would be wrecking yet another respected institution of India’s political democracy.

Also Read: Recalibrating India’s GDP to the Mahabharata, Circa 5561 BC

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