Why Jaitley should not focus on growth numbers while preparing Budget 2018

In today's context, a more basic point surely is that when growth estimates are so unreliable, it makes little sense to focus heroically on one number

Spare a thought for Finance Minister Arun Jaitley. When Mr Jaitley presents his Budget next month, he must know that he doesn’t have a handle on the all-important number, namely, the growth estimate for India’s gross domestic product (GDP). The growth in GDP (along with the inflation rate) determines the increase in tax revenue. It also determines the denominator in the fiscal deficit to GDP ratio, perhaps the most closely watched number in any Budget. 

Mr Jaitley’s estimate of GDP growth of 7.5 per cent for 2017-18 in the Budget for 2017-18 is turning out to be nearly a full