‘Ill-educated, egregiously wrong’: World Bank ED Mishra on row over GDP data, says growth on the upside

World Bank Executive Director Neelkanth Mishra has termed "ill-educated" and "egregiously wrong" the claims that India's economy grew by 2.6 per cent in the first quarter of the current fiscal as against the 7.8 per cent.

Mishra's statement on X came amid a political row over the growth figures released by the government, which were contested by former finance secretary S C Garg.

"... I was shocked to see the ill-educated and egregiously wrong claims made by some that if the 'original' base of June-2025 quarter was used, growth in the June-2026 quarter would be much lower," Mishra said.

Garg claimed that the current prices GDP last year was ₹86 lakh crore, which was revised down to ₹80 lakh crore, and that had that not been done, the GDP growth would have been only 2.6 per cent.

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"As expected, with the fiscal headwinds fading and monetary headwinds (falling credit growth till 1HFY26) becoming tailwinds (credit growth accelerating), GDP growth is surprising on the upside, and should help push up consensus trend-growth estimates to 7 per cent-plus. That is, with a neutral fiscal and monetary policy, the economy should still register 7.5 per cent growth," Mishra said.

He said the new series introduced in Feb-2026 cleaned up the data and also significantly improved the methodology.

"For those who track this for a living (and I used to be one such till 45 days ago) - the downward revision in the base was known in March… the new series increased credibility of estimates of real output," Mishra said.

"That claim is so obviously wrong that several logical rebuttals have already been made. But bad information tends to travel further than good information, and so it is important to reiterate and reinforce the argument," said Mishra, who till recently was the Chief Economist of Axis Bank.

"That such claims got traction is itself surprising, given that easy-to-track and not-possible-to-fudge indicators of economic activity have been so robust," he said, without naming Garg.

Mishra said the June-quarter data was strong and momentum has picked up.

He said personal vehicle (cars, SUVs) dispatches grew 35 per cent YoY in August despite just 9 per cent growth in exports.

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Even two-wheeler growth is now more than 20 per cent and commercial vehicle dispatches grew more than 40 per cent.

Mishra said tax collection growth has picked up meaningfully and credit growth continued to surprise on the upside, albeit on a low base.

"Last year most believed the then-weak credit growth was a demand problem, whereas we steadfastly stated it was a supply issue - it has for now been addressed," he said, adding that the indicators of construction are robust.

"Hopefully, now there will be fewer people asking 'why private sector investment is weak', given that there is clear evidence of investments," he said.

Mishra said there is still slack in the economy, as seen in weak real-wage growth and it may take several quarters of above-trend growth for that to tighten, and bring back sticky inflation pressures.