Govt Initiates Measures To Enhance Economic Data Quality: Report

According to the report, the census would entail training and mobilising over 300,000 government personnel to enumerate citizens in the nation

The Indian government is reportedly planning several measures to enhance the quality of its economic data, which includes initiating a long-awaited population census. The Statistics Ministry has put forth several proposals, which have been under discussion in Prime Minister Narendra Modi's office over the past month, according to a Bloomberg report citing sources.

The proposed measures include resurrecting the business survey, which was last issued in 2014, and releasing the household consumption survey annually. Additionally, plans are underway to implement a consistent base year for crucial indicators and update the basket of goods used for inflation calculation, as per the report.

Additionally, the report mentioned that the government is contemplating conducting a new population census once elections are concluded. Traditionally carried out once every ten years, the last census was conducted in 2011, with the subsequent survey postponed due to the pandemic.

Economists have consistently advocated for a reformation in India's statistical methods, while PM Modi's own economic advisory council has expressed apprehensions regarding data quality. As the country's economy experiences rapid expansion and garners increased global investor interest, official statistics face heightened scrutiny. Relying on outdated surveys also amplifies the potential for policy missteps.

According to the report, the census would entail training and mobilising over 300,000 government personnel to enumerate citizens in the nation. The survey operation is expected to span approximately 12 months.

The revived business survey aims to provide officials with deeper insights into the economy's transition from agriculture to other sectors. It is anticipated that the survey will aid the government in crafting policies to bolster manufacturing, which has seen a gradual decline in its contribution to the gross domestic product (GDP) over time, as per the report. According to the World Bank, the ratio was approximately 13 per cent in 2022, whereas the government's target is to elevate it to 25 per cent by 2025.

The government intends to establish an advisory panel that offers recommendations to the Statistics Ministry regarding modifications to the base year in crucial economic data and adjustments to category weights. These plans are slated to be implemented following the elections scheduled for May, as per the report.

Presently, industrial production and GDP data are computed using the base year of 2011-12, while consumer inflation relies on the 2012 base year. Typically, statistics agencies update base years periodically to capture better evolving spending patterns and economic dynamics.