Estimate Committee suggested GDP overhaul

  • The Estimates Committee of Parliament headed by Murli Manohar Joshi, in its draft report has suggested to overhaul  the  current manner in which the GDP is measure.
  • According to the committee, current GDP  estimation does not provide complete estimation of economic activities. Even former Chief Economic Adviser Arvind Subramanian, had pointed about this.
  • As per the committee, following activities  do not  figure in  GDP calculation without which  iti can give  the complete picture of  economy: 
    • It does not measure the depletion of natural resources. Whereas any rise in GDP growth requires utilisation of natural resources, their utilisation and depletion is not taken into account while measuring GDP.
    • It did not incorporate the economic contributions of women in running households and maintaining accounts;
    • It did not measure whether an  increase in GDP resulted in an increase in happiness.
    • It did not take into account the change in quality of the output due to improvements in technology, or how advances like artificial intelligence will impact employment.
    • It has  not been combined with sustainability
  • The Committee has  strongly recommends to evolve indicators/parameters to gauge the environmental resource decay and replenishment efforts made to compensate the loss and also to capture these aspects in measuring GDP and other economic parameters. 

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