MOSPI must end GDP computation row: Rangarajan

Former Reserve Bank of India (RBI) governor C Rangarajan, who was conferred the first P C Mahalanobis Award in Official Statistics for lifetime achievement on the occasion of the National Statistics Day on Monday, called upon the ministry of statistics and programme implementation (MOSPI) to put the controversies related to national income at rest.

He also asked the government to give statutory recognition to the National Statistical Commission (NSC).

During his acceptance speech for the award on a webinar, organised to commemorate the 14th statistics day, Rangarajan said: “I hope that there is a satisfactory end to the controversies that have arisen in the recent past on data and statistics.” The award was instituted by MOSPI.

C RANGARAJAN, former RBI governor

When asked what kind of controversy, Rangarajan said he was referring to the estimation of national income. “There is big controversy and I want the people to remember on statistics

day that improving statistical system is the aim of these celebrations. That is why I used the word ‘satisfactory end’to the controversies. It is for the statistics department to clear the doubts.”

There has been criticism of the official statistics ever since the MOSPI came out with a new methodology to estimate the gross domestic product (GDP) on the base year of 2011-12 compared to the earlier 2004-05.

Even on the recently released GDP data for the fourth quarter and for the entire 2019-20, economists have raised doubts over the quality of data.

The data showed that GDP growth crashed to a 69-quarter low of 3.1 per cent in the fourth quarter of 2019-20. State Bank of India (SBI) group chief economic advisor Soumya Kanti Ghosh had said possibly the loss in Q4 because of the lockdown may have been evenly distributed across quarters. He estimated ~1.18 trillion loss was distributed across quarters in FY20 and Q4 accounted for only 50 per cent of that.

Rangarajan also said, “The statutory recognition to NSC should come as early as possible.”

He said right now NSC is functioning as a result of an executive order. “This is only the legislation which will put it at the top. Otherwise, the (statistics) department partly listens to it, sometimes does not listen to it. Once you put it in legislation, it will clearly state what is its role,” he added.

A draft Bill on NSC was earlier put in the public domain by the MOSPI. Rangarajan said, “Ultimately, it is the government that is to act. NSC can be advisory, but the whole point is that there should be a convention that the government accept its recommendations.”

Chairman of the economic advisory council to the Prime Minister Bibek Debroy said Covid-19 has flagged the issue of re-prioritisation of the government sector and paucity of its resources. It has raised the issue of reallocating government expenditure to the health sector, he said.

“NSC can be advisory, but the whole point is that there should be a convention that the government accept its recommendations”