Hotmail co-founder Sabeer Bhatia has made bold remarks about India’s economic measurement system, urging the country to rethink how it calculates GDP and shift its focus towards actual productivity and work. He said that India is lying about its GDP and the GDP data and its calculation is not correct. Speaking in a recent podcast, Bhatia said India must also reform its work culture if it wants to seriously compete with countries like China.
Sabeer Bhatia (born 30 December 1968) is an Indian businessman who co-founded the first free web-based email service, Hotmail.com (later Outlook.com) in 1996. In 2021 he co-founded ShowReel with his co-founder Aji Abraham. ShowReel initially focused on connecting users through short videos for job seekers and founders. But now it has turned into an AI-powered learning platform.
GDP Based on Transactions, Not Real Work
Bhatia raised concerns over India’s current GDP (Gross Domestic Product) calculation method. He said it relies too heavily on monetary transactions rather than measuring actual productive work.
“India’s GDP is all wrong. Just look at how it’s being calculated,” Bhatia said.
He explained that simple exchanges of money are being counted as economic growth—even when no work is done.
“If I give you ₹1,000 and you give it back to me, GST is added both times. That makes it ₹2,000 in GDP. But neither of us has done any real work,” he explained.
Bhatia compared this with systems in countries like the United States, where GDP is more closely tied to hours of labor and the value of actual work done.
Proposal: A Work-Based System of Measurement
To fix this, Bhatia suggested that India move towards a model that values effort and time. According to him, every profession—from laborers to lawyers—should be assigned an hourly rate, and GDP should be based on the total hours of effort reported by workers.
“Hours of effort lead to progress, not just financial transactions,” he said.
He emphasized the need for a transparent system where individuals self-report their work hours, supported by AI tools to make it efficient and trustworthy.
“Put everyone on a contract. A contract is simply a promise to yourself. Report your own work honestly. Use AI to scale this,” he suggested.
Bhatia believes that this kind of system would not only encourage honest tax reporting, but also make people feel more involved in the nation’s growth.
Criticism of India’s Work Culture
Bhatia didn’t stop at economic numbers—he also criticized the Indian work ethic, especially among engineers.
“In China, engineers become engineers and actually build things. In India, 99% of engineers become managers and start giving advice,” he said.
He stressed that India must begin to value hands-on work and creation, instead of promoting a system where practical skills are overlooked in favor of managerial roles.
He also pointed out that India’s software industry often focuses on outsourcing or “body shopping,” instead of creating original software products.
Education and Critical Thinking: The Need of the Hour
Another key area Bhatia touched upon was education. He praised China for providing subsidized education and basic needs, making learning accessible for all.
“In India, education is a privilege of the rich. Many get educated only to secure marriages and dowry, not to solve problems,” he said.
He proposed the use of technology and mobile apps to teach critical thinking and problem-solving skills, even if building new colleges takes time.
“We can teach through apps. Let people solve real problems. Happiness comes from solving other people’s problems,” he said.
Change Must Begin with the Youth
Bhatia concluded by saying that young Indians, especially Gen Z, can lead this transformation. With their tech-savvy mindset, they are better equipped to adapt to a system based on honest work, productivity, and problem-solving.
“Let the younger generation take charge. Real progress starts with real work.”
