Ministry of Statistics and Programme Implementation Current Affairs

Ravindra Dholakia committee: Government forms panel to upgrade norms for state, district level economic data collection

The Union Government has constituted 13-member Committee for Sub-National Accounts to upgrade the norms for computation of economic data at states and districts level in backdrop of plans to revise the base year for National Accounts or Gross Domestic Production (GDP) calculation. It will be headed by Ravindra H Dholakia, a retired professor of IIM Ahmedabad.

Terms of Reference of the Committee

The committee will review concepts, definitions, classifications, data conventions, data sources and data requirements for preparation of State Domestic Product (SDP) and District Domestic Product (DDP) and to lay down revised guidelines. It will also suggest measures for improving SDP and DDP in the country taking into consideration availability of data and requirements of Centre and States/UTs. It will also suggest state level annual and benchmark surveys keeping in view needs of System of National Accounts especially in view of next base year revision. It will submit its report within one year.

Background

The Central Statistics Office (CSO), under Ministry of Statistics and Programme Implementation (MOSPI) revises the base year of macroeconomic indicators, as regular exercise, to capture structural changes in economy and improve quality and representativeness of indices. CSO had last updated base year for GDP calculation to 2011-12 from January 2015, replacing old series base year of 2004-05.

MOSPI is planning to change base year to 2017-18 for calculation of GDP and Index Industrial Production (IIP) numbers from current 2011-12 with an aim to capture changes in the economy. At conference of central and state statistical organisations (COCSSO) earlier this year, it was suggested that same principles and concepts should be used while calculating SDP and DDP across the country to make data comparable.

Month: Categories: Business, Economy & Banking Current Affairs

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India Loses its Fast Growing Economy Tag to China

As per the data released by the Ministry of Statistics, India registered 7.1% growth in the financial year 2016-17, which is slower than the 8% registered in 2015-16. In the fourth quarter of 2016-17, India registered a growth of GDP growth of 6.1% compared with China’s 6.9% in the same period. Hence, it has lost its fastest-growing major economy tag in the fourth quarter of 2016-17. 

A decline is also visible in the Gross value added (GVA) growth. It was 6.6% for 2016-17 and 5.6% in the Q4 of 2016-17, compared with 7.9% in 2015-16 and 8.7% in Q4 of that year. The GDP growth rate has registered a slightly higher growth because of proportionate increase in indirect tax net of subsidies.

While GDP gives a picture of whole economy, GVA gives pictures at enterprises, government and households levels. In other words, GDP is GVA of all enterprises, government and households. Further, Gross Value Added (GVA) broadly reflects the supply or production side of the economy.
The GDP numbers have been computed based on the new 2011-12 base year recently adopted for data including the Index of Industrial Production (IIP) and Wholesale Price Index (WPI).

Reasons

The demonetisation drive of the government had an adverse impact on the economy. The GDP growth got reduced in Q3 and Q4 when compared with the growth rates in the beginning of the year.

GVA growth also registered a slow down in almost every sector in Q4 of 2016-17 when compared with the growth registered in the corresponding period of the previous year.

Capital formation was also relatively soft with growth below 30%.

Month: Categories: Business & Economy Current Affairs 2018

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