New data sources may be used for GDP, part of updation exercise

As part of the exercise to update the base year for national accounts, the government is looking to use more data sources that would give a more comprehensive picture on economic activities.

According to sources, the Ministry of Statistics and Programme Implementation, which is spearheading the exercise, is planning to tap into data on goods and services tax collection as well as construction and micro, small and medium enterprises.

“The two areas of the economy that have little data is the unorganised sector and the services sector. The objective will be to increase data on this to get a better understanding of economic activities,” said a person familiar with the development, adding that GST collection data has also become a rich source of information.

MOSPI is planning to tap into data from the Annual Survey of Unincorporated Sector Enterprises to capture activities in the unorganised sector for the compilation of national accounts.

According to sources, it is likely that the year 2022-23 will be considered for the new base year for national accounts. However, discussions are still underway on whether 2023-24 may be a better base year as by then the impact of the Covid-19 pandemic had also receded and it also had a normal monsoon.

“Discussions are still underway but it is felt that 2022-23 may be a good option for the base year as the  impact of the pandemic had by then eased and rains were also normal,” said a source close to the development.

Simultaneously, the ministry has also begun an exercise to update the base year of the consumer price index and the index of industrial production. All of these would have a common base year.

Sources said that the results of the household consumption expenditure survey 2023-24 will also be released soon. The HCES 2022-23 and 2023-24 will be compared to ensure that there are no serious anomalies and the data will be used for the CPI updation.

At present, the base year for national accounts or GDP is 2011-12 while for CPI it is fixed at 2012.
MOSPI had last month also organised an interaction with economists and forecasters of GDP and CPI to discuss the current methodology and the updation exercise.