NSSO report puts a hole through govt's GDP claims

The technical report of the NSSO has generated controversy following its observation that as much as 36 per cent units forming part of MCA-21 database, used in computing GDP, could not be either identifiable or traceable in the field.

Illustration: Uttam Ghosh/Rediff.com

The statistics ministry on Wednesday said an official committee will examine the NSS technical report on services sector enterprises, which has raised questions over the GDP data.

The technical report of the National Sample Survey Office (NSSO) has generated controversy following its observation that as much as 36 per cent units forming part of MCA-21 database, used in computing GDP, could not be either identifiable or traceable in the field.

The issue of coverage, quality and timeliness of the MCA database vis-a-vis the Annual Survey of Industries had been discussed in detail in the various meetings of the Advisory Committee on National Accounts Statistics and adopted only thereafter, the Ministry of Statistics and Programme Implementation (MoSPI) said in a statement.

The recent exercise of the National Sample Survey to bring out a technical report on the services sector was commissioned by the ministry to understand the data gaps and take remedial steps, while undertaking the new base revision exercise for the proposed 2017-18 series.

"The results of this NSS Report will be further examined by the Advisory Committee before finalising the approach and methodology for the proposed 2017-18 series.

"It is emphasised that there is no impact on the existing GDP/GVA estimates for the corporate sector as due care is taken to appropriately adjust the corporate filings at the aggregate level based on the paid up capital," the MoSPI said.

The ministry further said "it needs to be appreciated" that every revision in the estimates of GDP/GVA is based on the data available at the time of the respective release.

The coverage and quality of each data source - like revenue expenditure, taxes, and company filings data - improve over time.

Till the release of provisional estimates in any year, the estimates are based on indicators like the Index of Industrial production (IIP), wholesale price indices, core sector data on steel, cement, electricity, revenue expenditure, GST data, trade data on imports and exports, consumer prices, among others, it said.

The estimates based on indicators are reworked when the corresponding data source becomes available. By the time of the Third Revised Estimate, the coverage and completeness in the data sources are almost final and no further revision takes place, the ministry said.

Usually, no revisions in the estimates take place beyond the Advance Release Calendar.

Following media reports on NSSO findings, former finance minister and senior Congress leader P Chidambaram said that the NSSO revelations have "blown a huge hole" in the growth figures put out by the Central Statistics Office (CSO).

It turns out that the government has been using bogus data, he alleged.

"The CSO's growth figures are a sham. The CSO's complicity in putting out false data is a scam that needs to be investigated first," he said, alleging that the political leadership has "interfered" and "intimidated" the CSO and the NSSO.

The statistics ministry further said it is also embarking on the 7th Economic Census for all economic establishments with an aim to not only assess the nature and distribution of establishments but to also form a National Business Register that can be periodically updated.

This will greatly facilitate future establishment surveys undertaken by the central and state governments. The field work for the Economic Census is slated to commence in June, 2019.