Why India needs another statistical revolution..

Recently a trio of economists had deplored the decline in Indian statistical system.

Pramit Bhattacharya in this superb piece writes more on the issue:

The edifice built by Mahalanobis was designed for a command-and-control era when it was easy for the state to demand and receive information from companies. But the opening up of the economy showed that the edifice was ill-suited to a market economy, in which the state no longer controlled all aspects of production and trade.

An opportunity to reform the statistical system arose when the National Statistical Commission (NSC) was instituted to suggest changes to improve its functioning. NSC, headed by C. Rangarajan, made several important recommendations in its report in 2001 to reform the structure of the statistical system, and to improve data collection methods. But as Srinivasan pointed out in a sharply worded critique, “its failure to offer any methods for judging the adequacy, timeliness and accuracy of statistical data and to undertake cost-benefit analyses of its concomitant recommendations undermines the utility of its work”.

“Without such information, how can the government decide how to apportion its scarce resources among competing priorities?” he asked.

Srinivasan’s concerns turned out to be prescient as successive governments have ignored most of the substantive recommendations of NSC relating to improvements in the statistical system’s data collection capacity. Apart from providing for staff incentives and the setting up of a national statistical regulatory agency, little else has been attempted.

Even though changes in regulations, new survey initiatives and increasing digitization have provided the Indian state with far more information than ever before, there is no evidence that such data is being collected and processed efficiently. One glaring example is the use of the MCA-21 database for GDP estimation. Statisticians seemed to have decided to use the database first, and ask questions later, and have failed to release the detailed data or the summary tables till date. A similar problem seems to plague the Socio-Economic Caste Census (SECC). This census was potentially a far-more important initiative than Aadhaar, as it was initiated to precisely identify those who could be targeted for welfare schemes. But as several economists have pointed out, the SECC data suffers from serious flaws. While it is a step forward compared to the past, it is also an opportunity lost. Instead of examining the processes that led to the collection and processing of the SECC data, the government first announced that it is going to use the database, and then set up a committee, headed not by a statistician but an ex-bureaucrat, to examine the data.

The digital age raises newer challenges. The questions of which entity will store data in what form and with protections, how and when such data will be collected, used, shared, or disseminated have become much more important than ever before.

The need for coordinating the activities of different data-collecting entities, and for laying down norms with foresight has never been as great as it is today.

But can we expect our beleaguered statistical system to rise to the challenge? Can we expect it to show foresight, and burnish its credibility by inviting outside experts rather than insiders to review its work?

The answers to these questions will determine the kind of data society and economy we will face in the coming years.


That was a time when people did so much to create institutions which matched world class and even beat them. How it has all declined in recent years..


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