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TRANSPARENCY PLEASE

Global economists, political scientists ask India to release withheld economic data

REUTERS/AMIT GUPTA
How to measure deprivation?

Close to 200 Indian and international economists today (Nov. 21) appealed to the Indian government to release the national data reportedly withheld because they painted an unfavourable picture of the country’s economy.

Last week, on Nov. 15, the Business Standard newspaper had published a report based on the 75th round survey of consumer expenditure, 2017-18, done by the National Statistical Office (NSO) under India’s ministry of statistics and programme implementation.

“Consumer spending fell for the first time in more than four decades in 2017-18, primarily driven by slackening rural demand, according to the latest consumption expenditure survey by the NSO,” the report said.

Following the publication of the newspaper’s report, the government decided to scrap the survey over “data quality,” Business Standard reported the next day, on Nov. 16. It said the ministry had cited “concerns” over the data flagged by a committee of experts to withhold it.

However, the newspaper contradicted the ministry’s claim in a report published today (Nov.21), in which it said the panel had not flagged any such quality issues.

The statement issued today was signed by not only economists but even experts from other fields. This included political scientist and author Christophe Jaffrelot, Thomas Piketty of the Paris School of Economics, R Nagaraj of Mumbai’s Indira Gandhi Institute of Development Research, Abhijit Sen, former member of India’s planning commission, and Jayati Ghosh, professor at Jawaharlal Nehru University.

Here is the full text of their statement:

We the undersigned demand that the government of India releases the report and data of all NSSO surveys that have been completed and approved by the NSSO’s internal systems, including the results of the 75th round survey of consumer expenditure, 2017-18.

A media leak published in Business Standard has revealed that the 2017-18 Consumer Expenditure Survey shows a sharp decline in average consumption. It has been suggested that the survey results are not being released because they support other evidence that the economy is experiencing a downturn. The Ministry of Statistics and Programme Implementation has now announced that the results of the survey will not be released at all, because they show a higher divergence with the “administrative data” than for earlier surveys.

It should be noted that consumption surveys are known to give results that diverge from macroeconomic estimates of the National Accounts. Also,  National Accounts estimates are based not only on administrative data but on a combination of sources including NSSO and other surveys. Several committees have looked into these discrepancies. While further work can be done to identify sources of and reduce these discrepancies, the common understanding has been that the flaws lie as much in the methods deployed for arriving at macroeconomic estimates as they do in surveys.

Consumption surveys are crucial for monitoring trends in poverty and inequality, and are also of critical value for national income accounting, and for updating macro-economic data such as price indices. They can provide an important check on administrative and macroeconomic data, which is important both for policy makers and the general public. The fact that data on supply of goods and household consumption are diverging points to the need for questioning supply side data (which are being widely questioned within and outside India) as much as it points to the continuing need for improving survey methods.

It is of fundamental importance for the nation that statistical institutions are kept independent of political interference, and are allowed to release all data independently. The record of the present government on this score has been very poor. Until recently, India has good cause to be proud of its statistical system, and the sample surveys conducted by the NSSO have served as a shining example and a model to the rest of the world. While there has been much discussion and debate about the methodology of the surveys, these have been scientific and technical in nature, devoted to trying to improve the system to enable better measures of crucial indicators.

However, this government has chosen to attack the credibility of this pre-eminent statistical institution simply because the results of the surveys do not accord with its own narrative about the economy, without providing any adequate reasons, and by misrepresenting essential features of the surveys. It has repeatedly shown its disinclination to make public any information that may show its own performance in a poor light. Last year, before the parliamentary elections, the results of the Periodic Labour Force Survey were not allowed to be released until the Parliamentary Elections were over, despite the resignation of two members of the National Statistical Commission, and a leak in the media. Subsequently, results of other surveys including the 75th round (Consumer Expenditure), 76th round (Drinking water, Sanitation, Hygiene, and Housing Conditions) and more recent quarterly data of the PLFS surveys, have not been released.

This suppression of essential data is terrible for accountability and for ensuring that citizens have the benefit of official data collection that is paid for with their taxes. It is also counterproductive for the government, which may be kept in the dark about actual trends in the economy and therefore not be able to devise appropriate policies. Undermining the objectivity and credibility of an independent statistical system is fundamentally against the national interest.

In the interest of transparency and accountability, all data must be released without delay and irrespective of what the results are. The government may wish to defend itself against interpretations of the statistics that it disagrees with. But this is best done through technical papers and seminars. To prevent release of data that are adverse, and diverge from its own understanding, is neither transparent nor technically sound.

Indeed, in order to produce transparent and robust information on distribution, it is also important for the government to grant researchers access to (anonymous) tax microfiles.

We therefore demand that the government should immediately release the report and unit-level data of the 75th Consumer Expenditure Survey. The government should also commit to release all other survey data after the usual processes to check for possible errors have been concluded.

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