Former Economic Advisor Arvind Subramaniam said on Saturday that Bangladesh has not overtaken India yet, nor is it likely in the near future, on proper economic parameters. He said that in order to estimate the general level of welfare of the people in a country, per capita income is an indicator of only one indicator.
But in capita GDP
The latest IMF report has projected that Bangladesh may overtake India in terms of GDP per capita in the current fiscal year (2020-21) affected by Kovid 19. Former Congress president Rahul Gandhi, while citing a recent report by the IMF, took a jibe at the Modi government that “this is a six-year concrete achievement of the BJP government.” Government sources say that India’s gross domestic product (GDP) in 2019 was 11 times that of Bangladesh in terms of purchasing power parity.
IMF Report: India may lag behind Bangladesh in capita GDP this year
India is far ahead of Bangladesh
In a series of comments on Twitter, Subramaniam said that (after the Global Economic Outlook report of the Monetary Fund came out), concern and gimmick had started about the comparison between India and Bangladesh on per capita GDP. He said, “Of course not, India has not lagged behind on more appropriate criteria and it is unlikely to happen in the near future according to the Monetary Fund”. He said that in this debate only the current exchange rate By comparing the person’s income, it is being concluded that Bangladesh has dominated India. But the exchange rate of the market does not remain a reasonable measure of measurement of average welfare level in every country.
But capita income is not the only indicator
He said that in order to estimate the general level of welfare of the people in a country, there is only one indicator per capita income among all the indicators. He said that the need is to assess GDP in local currency and take into account the impact of inflation. Estimated real GDP based on local currency should be calculated in terms of comparable dollars. He said that it would be more appropriate to use a purchasing power parity (PPP) based exchange rate at a constant price to compare GDP.
10.3 percent decline in GDP estimated
He said that there is no resting opportunity for India. The country will now be able to reach the first level of Kovid 19 in 2022. That is, the loss of three years. The report of the Monetary Fund states that India may go below Bangladesh per capita GDP due to an estimated contraction of 10.3 per cent of GDP in the current financial year.