PM to Attend D-8 Summit in Pakistan

[CaPtAiN_pLaNeT]

I was expecting an explanation of what the upward revision of base year from 1995 to 2005 means. How this will change the calculation of our GDP to upward? Say something a novice can understand and not the links. Links only says about the neceassity of change, but do not expalin the process that will make a change in the GDP figure.

Well how it will change the estimation of GDP can only be explained by the economists. But one of the article that I posted provide how it may be done but not full detail of economical calculation.

UNBconnect... - Government mulling revising GDP base year to 2005-06

Meanwhile, the BBS will soon conduct a survey on internet provider, mobile phone companies, cable operators and courier services as part of its initiative to rebasing GDP. Another survey on incorporating the cultural activities into estimation of the GDP has been completed and the results will be available very soon.

The BBS earlier planned to conduct a series of surveys from primary and secondary sources before re-fixing the GDP to a recent base year. It prepared a list of 26 surveys for upgrading the base year, but the number might come down to 15 later on, said another Statistics Division official.

Updating the base year and the need to revise the GDP estimation has become essential for various reasons like newer economic activities, progressive expansion and downsizing of certain industries/economic sectors over the years. Changes in relative price of commodities also necessitate revision of GDP deflators to correctly monitor the real growth.

A comprehensive and systematic revision of GDP and revising the base year, therefore, appears imperative to improving coverage and removing the methodological flaws and data deficiencies.

Within the span of last 15 years, production in several key sectors has surged in response to the incentives provided by the government.

Production of agricultural crops, particularly vegetables and other minor crops recorded rapid growth while cultivation of new crops like maize, soybean, strawberry, `baukul’ (a special variety of plum developed by Bangladesh Agricultural University), and other types of fruit are expanding.

Increased growth of poultry, livestock, pond fisheries, fish fry hatcheries and farm forestry is aiding and helping diversified sources of agricultural growth.

Manufacturing industries particularly bottled water, textiles, cement, pharmaceuticals, electrical and sanitary fittings, tiles and ceramics, cosmetics, software development, recycling and many others are on a rapid expansionary trajectory in response to domestic and external demand.

The construction industry is booming in response to the massive expansion of the dwelling houses, other buildings and infrastructure facilities. Information and communication sector is also expanding at a phenomenal rate.

However, the growth and structural changes that are occurring in the production process of the economy are not adequately reflected in the current GDP compilation.

Besides, some of the sub-sectors such as IT and communication, financial leasing, and various modern personal services are also not adequately represented in the existing GDP estimates.

 

[CaPtAiN_pLaNeT]

The following article may help you to understand how the base year can affect the calculation of real GDP.

Economics: Nominal GDP, Real GDP, and Price Level

The reference base year which is used for calculating the GDP is completely outdated which is the reason why we are getting a much less GDP while calculation and many sectors are also not included as mentioned earlier. See the last example as provided in the above link to understand the basics of the calculation.

 

[eastwatch]

You belong to 71 generation so I understand your concerns but I don't think Pakistan will comply with your demands. Pakistan has it's internal problems to tackle in 2012 so it has no time for 71.
They are more interested to build relation on real time.

If you are happy discussing about the past then you are better of spending time in Bangla and Indian forum where you will have amble of audience.

I born much after 71 and I would love to move forward based on 75 revolution. I am follower of Zia and he already established a brotherly relation with Pakistan along with China and Muslim worlds. So for me and many other, it's better choice to seal the past and leap to future.

You have choice to either jump in future train or stuck in horse carriage and die with misery.

It is a discussion forum, isn't it? So, we must discuss every thing with open mind. A blind muslim brotherhood is valueless. A strong relationship exists between two countries on the basis of equality and also by hard talk because only a hard negotiation settles many disputes. BD will not get back what it earned until 1970 but spent in the west. But, we must not stop talking about this.

We should also talk how the Indians took away our German-made high quality jute mills machineries to their dirt-poor Hindustan. This was the last straw that broke the back of the camel. Indians built five new jute mills acroos the border, used its influence with the AL establishment, who organized smugglings of raw jutes to India. Jute had a few years of life until the late '70s, after which it was dead on the onslaught of chemical fibers.

So, Indian action was the last straw on the back of our economic camel at that period. Our brother west's stealing for 22 years and then Indian stealing for the next few years broke our economic backbone, only to be back to a strong position with us working as Darji (Tailor) slaves to stitch garments for export to the white west.

 

[eastwatch]

The following article may help you to understand how the base year can affect the calculation of real GDP.

Economics: Nominal GDP, Real GDP, and Price Level

The reference base year which is used for calculating the GDP is completely outdated which is the reason why we are getting a much less GDP while calculation and many sectors are also not included as mentioned earlier. See the last example as provided in the above link to understand the basics of the calculation.

Thanks for the link. It seems the 1995 base year gives us a lower GDP because of a flawed rate of inflation. As I understand,

1) A 2005 upward base year will allow the statisticians to add dozens of new items in the list of production.

2) Bringing up the base year to 2005 will result in a lower rate of inflation, because inflation will be calculated based on the new base year. And this lower rate of inflation will show a higher GDP, because real GDP = Nominal GDP - Inflation. So, once the rate of inflation is low, it will cause the real GDP to be higher.

I think, the twin effects will bring the GDP up. If underground economy is added the GDP will be about $170 billion. However, for reasons such as the possibility of getting less facilities in the western export markets or getting less aid, the GoB may not be interested to revise the base year so upward to 2005. Instead, the govt may make it only 2000, who knows?

 

[CaPtAiN_pLaNeT]

Thanks for the link. It seems the 1995 base year gives us a lower GDP because of a flawed rate of inflation. As I understand,

1) A 2005 upward base year will allow the statisticians to add dozens of new items in the list of production.

2) Bringing up the base year to 2005 will result in a lower rate of inflation, because inflation will be calculated based on the new base year. And this lower rate of inflation will show a higher GDP, because real GDP = Nominal GDP - Inflation. So, once the rate of inflation is low, it will cause the real GDP to be higher.

I think, the twin effects will bring the GDP up. If underground economy is added the GDP will be about $170 billion. However, for reasons such as the possibility of getting less facilities in the western export markets or getting less aid, the GoB may not be interested to revise the base year so upward to 2005. Instead, the govt may make it only 2000, who knows?

You are right... but many least developed country has much higher gdp per capita for example Angola. It depends on diplomacy to keep the LDC status in our favor. Lets see what happen next but Government will go for the 2005 base year that is for sure. In the mean time India is upgrading its base year to 2011-2012 from current 2005.

 

[TopCat]

Thanks for the link. It seems the 1995 base year gives us a lower GDP because of a flawed rate of inflation. As I understand,

1) A 2005 upward base year will allow the statisticians to add dozens of new items in the list of production.

2) Bringing up the base year to 2005 will result in a lower rate of inflation, because inflation will be calculated based on the new base year. And this lower rate of inflation will show a higher GDP, because real GDP = Nominal GDP - Inflation. So, once the rate of inflation is low, it will cause the real GDP to be higher.

I think, the twin effects will bring the GDP up. If underground economy is added the GDP will be about $170 billion. However, for reasons such as the possibility of getting less facilities in the western export markets or getting less aid, the GoB may not be interested to revise the base year so upward to 2005. Instead, the govt may make it only 2000, who knows?

After the new base year if that increased by 30% our nominal per capita income will reach to 1300 dollar which is close to or higher than Pakistan.
If that increased by 50% it will reach 1500 dollar which is close to Indian per capita income.

 

[CaPtAiN_pLaNeT]

After the new base year if that increased by 30% our nominal per capita income will reach to 1300 dollar which is close to or higher than Pakistan.
If that increased by 50% it will reach 1500 dollar which is close to Indian per capita income.

No you are wrong. With 30% increase it will be close to 1000 usd and 50% increase will make it somewhere in between 1000-1200 usd. You might have some done some mistake in calculation. But whatever the matter within the next couple of years Bangladesh's per capita GDP will cross that of Pakistan. For India it may take some time but will happen eventually within a decade or so.

 

[bruce wayne]

No you are wrong. With 30% increase it will be close to 1000 usd and 50% increase will make it somewhere in between 1000-1200 usd. You might have some done some mistake in calculation. But whatever the matter within the next couple of years Bangladesh's per capita GDP will cross that of Pakistan. For India it may take some time but will happen eventually within a decade or so.

....even my bangladeshi servent knws da truth.

 

[TopCat]

No you are wrong. With 30% increase it will be close to 1000 usd and 50% increase will make it somewhere in between 1000-1200 usd. You might have some done some mistake in calculation. But whatever the matter within the next couple of years Bangladesh's per capita GDP will cross that of Pakistan. For India it may take some time but will happen eventually within a decade or so.

No i did not make mistake. this year our GDP is projectd 137000 million.

GNI/Capita = (137000 + 41000 (30% increase) + 14000 (remittance))/150 million = 1280 USD

 

[danger007]

No you are wrong. With 30% increase it will be close to 1000 usd and 50% increase will make it somewhere in between 1000-1200 usd. You might have some done some mistake in calculation. But whatever the matter within the next couple of years Bangladesh's per capita GDP will cross that of Pakistan. For India it may take some time but will happen eventually within a decade or so.

increase another 200% you will cross china too...

 

[CaPtAiN_pLaNeT]

No i did not make mistake. this year our GDP is projectd 137000 million.

GNI/Capita = (137000 + 41000 (30% increase) + 14000 (remittance))/150 million = 1280 USD

Are you sure remittance money is counted separately???? What you said may be true but excluding the remittance it may not be the case. And what is your source for the 137 billion usd GDP???

increase another 200% you will cross china too...

Not 200% but in 2000 when base year was changed to 1995 from 1985 there were an increase of 30%. This time it is expected could be more at least some where in between 30-50%. Look at the above comments specially 64 for details.

 

[TopCat]

Are you sure remittance money is counted separately???? What you said may be true but excluding the remittance it may not be the case. And what is your source for the 137 billion usd GDP???

In calculating per capita income you have to calculate external income too which is remittance in our case. i was talking about per capita income not GDP/capita.
137 billion is in this year budget. check it.

 

[CaPtAiN_pLaNeT]

In calculating per capita income you have to calculate external income too which is remittance in our case. i was talking about per capita income not GDP/capita.
137 billion is this year budget. check it.

This years budget is 137 billion ... are you sure!!!

 

[TopCat]

This years budget is 137 billion ... are you sure!!!

Not budget but projected GDP in the budget.

 

[CaPtAiN_pLaNeT]

Not budget but projected GDP in the budget.

Do you have the link of the budget??