The given statement is completely true that GDP does not give us a clear indication of economic welfare of a country. GDP is a measure of economy's production or it can be considered a component of welfare. A higher GDP means more production of goods and services in an economy during a given year. Therefore, a higher GDP also means that more goods and services were available to the people of the country during the year. But it does not indicate that the people were better off during the year. In other words, a higher GDP may not necessarily mean higher welfare of the people.