The statistics department will shortly release the supply use table ( SUT) to clear GDP data discrepancies, blamed for pushing up economic growth to close to eight per cent in the March quarter of 2015- 16, by this month- end.
However, the provisional estimates of GDP data, like the one which was released in May for 2015- 16, would always show discrepancies in the expenditure side of the data. “ There are ways to eliminate discrepancies as well. We are working on it. We will probably release SUT once it is finalised,” Chief Statistician TCA Anant said.
The supply use tables are like input output matrix but cover larger data than the latter. It would cover both services as well as manufacturing, unlike input output matrix which cover only factory production. The supply table describes the supply of goods and services, which are either produced in the domestic industry or imported. The use table shows where and how goods and services are used in the economy. Sources said a couple of approvals have to be taken within the Ministry of Statistics and Programme Implementation ( MoSPI) before releasing the table. However, only the table for 2011- 12 and 2012- 13 would be released by the Central Statistics Office now.
Discrepancies would be eliminated only with a lag. This means that GDP data for 2015- 16, released in May, would still show discrepancies because the SUT for it would take time. “ Its a very tedious exercise. Discrepancies will be zero only for the year for which we have done it. There will be a lag," Anant said.
The chief statistician explained that in the short run, there will always be discrepancies.
These could be eliminated by a simple rule of distributing the numbers pro- rata to the other components of the expenditure side — private final consumption expenditure, government final consumption expenditure, gross fixed capital formation and so on. " But is that what you want?" asked Anant. "Once we have more robust data, we will tell you a better way to allocate discrepancies, which is what SUT does." SUT, explained Anant, covers the full vector of goods and services. While the input- output table is limited for manufacturing, SUT has a wider basket. NSSO surveys, consumption surveys, data on use of services from manufacturing side in the Annual Survey of Industries (ASI) data and some data from state governments have been used. An official of MoSPI explained that on expenditure side, lots of rates and ratios are used because of which discrepancies emerge as data is not exactly measured.
Indias GDP growth rose 7.9 per cent in the fourth quarter of 2015- 16. However, if discrepancies are taken out, the growth would only be 3.9 per cent. But Anant finds this kind of criticism emanating from the lack of understanding of statistical data. Even in the new GDP methodology, production side is the principal source of data even as we estimate GDP at market prices and no longer at factor cost.
After estimating gross value added in production side, indirect product taxes are added and subsidies subtracted to arrive at GDP. On the expenditure side, there would always be discrepancies until SUT comes out. These inaccuracies could be because the break- up of GDP at market prices ( which is a new definition of the GDP) either overshoots the headline number or falls short of it. If the break- up of private final consumption expenditure, gross fixed capital formation, government final consumption expenditure, change in stocks, valuables, and net exports exceed GDP, discrepancies will be negative and if it is less than the GDP, the discrepancies will be positive.
Business Standard New Delhi,07th June 2016
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