A Review of India’s Statistical System

The importance of accurate data to guide policy cannot be overstated, particularly in the digital age. India, once known for its innovative approaches to collecting and analyzing data, seems to be losing clarity in its statistical vision. Having a clear and robust statistical system is not just a luxury; it’s a necessity for effective governance and optimal policy formation. The recent move by the Prime Manager’s Office (PMO) to review India’s statistical system, as reported by Reader Wall, is a commendable initiative aimed at improving the accuracy of India’s key variables.

The Need for Accurate Data

Despite having modern tools at our disposal, the lack of accurate data presents a serious challenge. For example, the delay in collecting census data due to the COVID-19 pandemic raises concerns about the accuracy of our demographic projections. Often, we rely on projections from global agencies as the foundation for our population statistics. It’s important to remember that these numbers have significant implications on other metrics, like the Gross Domestic Product (GDP), which measures the economic well-being of our citizens. Consequently, maintaining the accuracy of our GDP statistics also becomes a priority.

Scrutiny of GDP Metrics

However, the calculation of GDP, like any other metric, is subject to input-quality hazards. The government’s 2015 GDP update — the adoption of the 2011-12 base series — led to criticism, particularly concerning the representation of our informal sector. Some critics argue that the use of proxy data might lead to overestimation of its output. The controversy surrounding GDP stats has been reignited by the ongoing debate about the shape of the financial recovery from the COVID-19 pandemic. Regular revision of GDP numbers also leads to potential loss of confidence in these metrics. Therefore, gaining faster data clarity and scrutinizing measures of national income are needed.

Potential Improvements

Enhancements can also be made in terms of price indices. The use of a Producer Price Index is worthy of consideration. And it doesn’t stop there. Other metrics, surveys, and dashboards should also be put under the microscope. However, changes should be made carefully to ensure continuity with past records.

The Role of Transparency

Public faith in official numbers has been steadily eroding. In the past, leaked results of a National Sample Survey on consumption led to skepticism about potential cover-ups. To restore credibility, the statistical system must be transparent. Without transparency, it’s challenging to secure the public’s faith in future revisions.

Conclusion

The efficacy of governance is contingent on the clarity of data describing various aspects of progress. For top-tier leadership, having an accurate view of reality is not just important; it’s crucial. A robust statistical system, operating autonomously, is necessary. According to Reader Wall, the Prime Minister’s Office understanding this underscores the importance they place on having a statistical system that provides a clear, high-resolution picture of our nation’s progress.