An unseemly tussle seems to have broken out between economists and chartered accountants (CAs) with 131 CAs countering 108 economists and saying what the economists are doing is a smear campaign at the behest of vested interests a la the award wapsi gang in the run up to the upcoming general elections.
There was a whisper campaign against the appointment of S Gurumurthy, the Rashtriya Swayamsevak Sangh (RSS) ideologue and one of the founder members of its offshoot the Swadeshi Jagran Manch (SJM), to the Reserve Bank of India (RBI) board.
Some went to the extent of saying Gurumurthy was a CA whereas it took an economist to adorn the hallowed boardroom of the RBI. Implicit in this argument was the belief that a CA was only well-versed in taxation, auditing and company law without being rooted in economics. That the Narendra Modi government has two CAs in its council of ministers — Piyush Goyal and Suresh Prabhu — and has also perhaps got something to do with the prejudice against the CAs.
The CAs versus economists war of words was spearheaded by the 108 economists railing against the revision of Gross Domestic Product (GDP) data and withholding of employment data by the National Sample Survey Office (NSSO). Of course, they did not target the CAs but only targeted the Modi government. That CAs have taken up cudgels for the Modi government may have something to do with the Modi government’s earnest fight against the non-performing asset (NPA) and black money.
Mirrors don’t lie but statistics can especially be given the leeway available to the compiler of data to interpret them to further his cause or viewpoint.
Thus to the economists, the Employees' Provident Fund Organisation (EPFO) statistics on employment is suspicious whereas to the Modi supporters, it is their holy grail more so as it reflects increasing formalisation of the economy. But the economists want the NSSO data out. EPFO data on employment in their worldview is suspicious. Be that as it may.
The Modi government has set store by the Mudra loan to 16 crore people. The economists and Modi detractors lampoon Mudra loans as condemning our youth to frying pakoras.
To be sure, while microfinance is not the same as venture capital assistance inasmuch as while the former is at the grassroots levels whereas the latter is at the levels of giving leg up to a possible cutting edge technology. The truth, however, is self-employment cannot be caviled at.
The paradigm changing Goods and Services Tax (GST) has also served to mainstream the economy like never before as evidenced by surge in (50 percent as affirmed by the Economic Survey 2018) indirect taxpayers as well as in income tax collections. Indeed, the audit trail left by Value Added Tax (VAT) has brought a large swathe of businesses hitherto operating in the subterranean informal (read cash) economy above board.
A lot has happened on the societal front also in the five years of Modi government with Ujwala Yojana wiping tears of rural women with gas connections and Jan Dhan Yojana making direct benefit transfers possible and leak proof.
Even the economists would concede that the National Democratic Alliance (NDA) government has done something unparalleled on the NPA front with its pincer of Insolvency and Bankruptcy Code (IBC) that has fluttered the dovecots of the defaulting promoters and stoppage of ever-greening of bad loans through corporate debt restructuring (CDR), special drawing rights (SDR) etc.
It is wrong to pronounce verdict on a new government so soon in the day when its initiatives are still work in progress but have the promise of changing the economy in years to come. Thus a common man who cannot interpret figures and statistics is often bemused by talking heads on television shows holding forth with grim faces on the adequacy of 7 percent growth.
To him what matters is what he sees on the ground — food prices, petroleum products prices, fight against corruption and black money and yes, employment opportunities.
No one statistic can be used to pronounce a verdict on the incumbent government. Indeed it has to be a set of statistics meaningfully correlated and interpreted without prejudice. The feel-good factor also counts and sadly it defies quantification. The feel-good factor on the economic front stems largely on account of the Modi government’s fight against black money and NPAs.
(The writer is a senior columnist and tweets @smurlidharan)
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Updated Date: Mar 19, 2019 16:29:03 IST