Nothing illustrates the political polarisation over economics statistics in India better than the current discourse over a set of new back-series estimates of GDP growth, drawn up by a Committee on Real Sector Statistics as part of an effort to reform the statistical system. In normal times, the report of the Committee, headed by Sudipto Mundle, Emeritus Professor at the National Institute of Public Finance and Policy, would have occasioned no excitement — except among policy wonks. Indeed, the report had drawn little attention since it was uploaded on the website of the Ministry of Statistics and Programme Implementation (MoSPI) in late July.
But these are abnormal times. The chatter in recent days arose because the new back-series estimates of GDP growth, with base year 2011-12, suggested that growth exceeded the magical 10 per cent mark twice during the 10 years of the Manmohan Singh government: 10.23 per cent in 2007-08 and 10.78 in 2010-11. Congress partisans, who have all along questioned the legitimacy of the revised GDP series since it was introduced by the Modi government in 2015, have embraced the new back-series estimates — unofficial though they are — as a validation of the UPA’s shepherding of the economy. Evidently, they will have no more reason to question the fidelity of the data series. In turn, those in the BJP’s corner are questioning the quality of the 10-plus per cent growth, driven as it was by wide fiscal deficits and expanded bank credits.
Critically, the Mundle Committee’s methodology has its limitations in creating back-series data for extended periods, given the paucity of comparable data for earlier years. Even the current back series has been drawn up using one of three methodologies discussed: the production shift approach, which is not infallible. In any case, the entire episode starkly illustrates two points: the urgency of the need for a credible back-series data set, and the petty partisanship, on both sides of the political divide, over growth statistics.
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