Why is it important to strengthen the National Statistical Commission to get a clear picture of our country’s slowing economy?

We are not oblivious to the fact that our economy and along with that the growth rates have slowed down. We are also all well aware that the GDP figures that were released last quarter were the lowest in the past 26 quarter or 6 years. There has been a rise in credibility issues on the government framed economic policies that have come in to play and how in spite of the creation of capital or transferring money from RBI cash reserve or creation of alternate investment fund has done little to better the economy.

 

Recently the parliament released the National Statistical Commission (NSC) 2019 draft bill and asked recommendations on how and where it could be improvised. The first step towards the recommendations is to understand how and why we need the NSC draft bill.

 

To paint a picture of why this bill was drafted in the first place is to understand the importance of NSC and why it is crucial to know the role of this advisory body on statistical matters. It is necessary to highlight here that the statistics that are monitored by this body play a pivotal role in designing better economic and socio-economic policies for the country.

 

The beginning of last year saw a release of 2 GDP back revision(where the base year is changed) figures and both the figures are contradictory to each other. This change in the base year has garnered a lot of flack as a lot of prominent economists believe there might have been an overestimation of GDP figure by 2.5%. The base year was changed from 2004-2005 to 2011-12. The data that was released by the Sudipto Mundle Committee that was set up by the government differs from the one that was shared by CSO. The Sudipto Mundle committee figures indicated that India’s GDP growth rate topped the 10 per cent mark twice under the UPA regime, with average growth under the two UPA terms turning out higher than that under NDA. UPA spokespersons promptly bragged about the data to claim that India had a ‘golden run’ between FY06 and FY08 and that they had bequeathed a healthy economy to the NDA. Whereas this was calculated by a different methodology, called the production shift method, the government claimed that this was experimental and then released the data by CSO. The report by the Sudipto Mundle Committee has vanished from the website of the Ministry of Statistics and Program Implementation and the figures released by CSO have lowered the growth rates in the UPA regime. The back series data was further released by Niti Ayog(Formerly named as the Planning commission of India) which left the chairman of Statistical Commission amused as planning commission doesn’t have the authority to do that. 

 

The authority of NSC has been in questionable circumstances time and again as early last year National Sample Survey Office (NSSO) and Central Statistics Office (CSO) were merged to form National Statistical Office which will now be answerable to Ministry of Statistics and Program Implementation. The passing of this order was and still is worrisome because the National Sample Survey Office was initially meant to be under the National Statistical Commission and not the government as the order led it to be, so as to have minimum political interference. The order makes no mention of NSC, reinforcing the long-held belief that the government was undermining it. The last straw for the members of the commission was when CSO withheld the release of National Sample Survey Office report on jobs, which the NSC had cleared as the report indicated unemployment in India was at a 45-year high of over 6.1% in 2017-18. The row over the delay in release led to the resignation of members of the Statistical Commission. The government has time and again dodged issues that need addressing and has diverted attention to events that lead to the polarization of communities.

The bill has been launched with the intention to strengthen the legislative framework so as to decrease political interference and increase authority but makes it difficult to understand as to how would that be instilled because the new bill proposes that committee be formed by the government itself. It should at least have a bipartisan opinion before selecting the members forming the committee as the data that is collected by the committee is used in all the policies that are formed for the welfare of the country. So if the data that gets collected and manipulated for political reasons, it could lead to catastrophic outcomes, outcomes that are hard to recover from.

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