'Ask Rahul Gandhi to...': Ex-Infosys CFO Mohandas Pai as Congress bats for measuring job creation, not GDP

As Congress party's Data Analytics department head batted for a model for measuring job creation instead of measuring GDP, former Infosys Chief Financial Officer Mohandas Pai on Wednesday said that the grand old party should do this in states where it is in power. He called the idea an "empty rhetoric". 

"Pl ask @RahulGandhi to do this in states ruled by @INCIndia. Empty Rhetoric which changes every day is of no use," Pai said while responding to a tweet by Praveen Chakravarty, Chairman of Professionals' Congress and Data Analytics Department. Pai's response came as Chakravarty shared a quote from Gandhi, who in September said "We have to move from a model of measuring GDP to a model of measuring jobs created. We need a change in the national mindset."

The former Infosys CFO said the Karnataka government headed by Siddaramaiah and DK Shivakumar has ruined Bengaluru, "spoiling job creation by lack of governance, investment and misrule."       

Chakravarty also shared a piece, explaining the economic rationale for moving away from measuring GDP. He argued that while GDP has long been used as a proxy for prosperity, it no longer reflects the well-being of the population in an era of automation and stagnant employment growth.

He explained that the "trickle-down" theory — where producing more goods and services is expected to create more jobs and increase incomes — has guided economic policy for decades. "It worked wonderfully well for three decades. But producing more does not necessarily mean employing more people any longer." 

Citing global examples, the Congress leader pointed out that the world's largest electronics manufacturer, Foxconn, nearly doubled its sales between 2010 and 2020, but its total number of workers remained roughly the same. "This was due to automation and machines replacing humans, which is an inevitability."

Chakravarty highlighted an earlier attempt to address the limitations of GDP. In 2008, then-French President Nicolas Sarkozy commissioned a study led by 25 economists and social scientists, including six Nobel laureates, to identify better indicators of economic and social progress.

The report, he said, concluded that GDP alone could not measure well-being and recommended a shift towards tracking more holistic indicators. However, he noted that the 2008 global financial crisis disrupted these efforts, and most countries, including India, still rely heavily on GDP as the primary marker of economic success.

The economist emphasised that India should no longer be bound by outdated measurement systems. "The time has come to debate and implement more holistic measures of development," he stated. He suggested leveraging India’s Aadhaar infrastructure to measure and publish formal job creation and median income data on a quarterly basis, alongside GDP figures.  

Chakravarty also proposed changing the way economic progress is discussed, recommending the introduction of "Gross Domestic Jobs" (GDJ) as a new marker. "India’s political leadership must take the lead in driving this narrative change," he said, noting that there seems to be growing political consensus on the need for more job-focused economic policies.  

According to Chakravarty, shifting from GDP obsession to a focus on job creation and well-being would align India’s economic policy with the needs of its people. "Let the best not become the enemy of the better. Adding a jobs indicator along with GDP data would be a significant first step," he concluded.