If you are a student of economics in India, you should set up a calendar for yourself. This calendar should include the date of the release of important information about the Indian economy – and the 28th of February is one such day. Why? Because that is when we get to know what went on in the third quarter when it comes to India’s GDP (and more GDP related information besides).
In today’s blogpost, I want to ask you ten questions. If you are a student of the Indian economy, you should try and figure out the answers to these questions. The act of researching the answers to these questions will tell you a lot more about GDP in India than any column praising or defending these numbers will.
Why ten questions? Nice round number, and a good place for me to stop, that’s all. I hope you come up with even more questions!
- What is the “second advance estimate”? And while you’re at it, what is the first advanced estimate?
- And if you are a glutton for punishment, what are the first, second and third revised estimates? When are they typically released?
- When have they been released this year? Why the difference?
- Has the data for previous years been revised? Why? How? What does that tell you about how to interpret the current quarter’s data?
- Take a look at the first table on pp. 7 of the PDF. What is up with manufacturing? This is an oh-so-important question. Think about it everyday if you are a student of macroeconomics and development in India. Every single day.
- Take a look at Private Final Consumption Expenditure (PFCE) (Tables 6A and 8A). What is up with consumption? This is also an oh-so-important question. Also think about it everyday. Every single day.
- What, in your opinion, are the drivers of growth right now? Whatever your answer, why? (Hint: what do you think about capital expenditure in India today? How do you think about it at the central government level and at the level of the states?)
- Where, in your opinion, will interest rates be going this year? How will this impact your assessment of GDP growth estimates this year? Why?
- What is your assessment of this year’s monsoon? Why do you think this question matters in the context of India’s GDP, especially this year?
- What is your assessment of where oil prices are going to go this year? How do you think the answer to this question will impact India’s GDP, especially this year?
How should you go about answering these questions?
- Take a printout of the press note, and annotate it to your heart’s content. Come up with questions about your annotations, and don’t worry about how many questions you come up with. The more the merrier!
- Go ask your batchmates (and also your seniors) about their answers to these questions. Don’t worry (yet) about whether you agree with the answers you get – listen, imbibe and check whatever sources you get to learn about.
- Once you do this, go ask your professor(s) about their answers to some of these questions. Feel free to ask them about what you should be reading to learn more.
- Reach out to people on Twitter or LinkedIn who you think might be able to answer some of your questions. Don’t be afraid of asking pretty much whoever you like, but do not think you are entitled to a response. You aren’t – but if your question is a well-thought out one, not only will you likely get a response, but it will most likely be a considered, detailed response. People are helpful that way, especially if they see that you’re making a serious effort to learn. The emphasis is on the word serious!
- Write. Once you do all of this, pen down your learnings, and the questions that still remain. Share it with the world. Make sure you do all this before 5.30 pm on the 31st of May, 2023. If you want to ask why, go reread the first sentence of today’s blogpost.
See you then!