New Delhi: Critical of the recent changes in the gross domestic product (GDP) calculation formula, a Parliamentary Panel on Thursday asked the government to constitute a committee of eminent economists to adopt “one acceptable methodology" based on practices followed world over.
“A high-level committee of eminent economists be constituted to consider the entire matter and one acceptable methodology may be adopted, keeping in context practices followed in the world economy. This will put an end to the debate on the methodology," a parliamentary standing committee on finance said in its report on statistics ministry tabled in Lok Sabha on Thursday.
Last year, central statistics office (CSO) made certain changes to the GDP data such as changing the base year and introduction of the concept of gross value added (GVA), which is internationally acceptable.
The committee noted the latest GDP data released by the CSO has raised more questions than providing answers and inputs on the momentum of economic activities across the country.
The panel observed that it (new data) does not seem to corroborate real economic activities, such as corporate profitability or credit growth.
It said the new methodology, which includes components of indirect taxes, only reflects inflated GDP figures rather than increased output.
The robust growth estimates in the face of slump and downturn in certain sectors also raises a critical point on the credibility and reliability of statistical data collected for various economic measures such as GDP; a concern flagged by several economists including the RBI Governor, it said.
It said: “Devising methodologies, which would project a rosy picture by inflating overall growth figures, will not surely serve the purpose. It is, therefore, necessary that all doubts and methodological ambiguities are removed forthwith and more realistic computation methods be adopted with a view to enhancing the credibility of official statistics."
The committee noted that there are as many as 713 vacancies in subordinate statistical service, out of which 622 vacancies exist in field operation division (FOD).
It recommend that urgent steps should be taken by the government to help the ministry overcome its acute manpower shortage at the field level, so that reliable collection and compilation of field statistics does not suffer.
The panel also suggested frequent changes in the schematic guidelines of Member of Parliament Local Area Development (MPLAD) scheme should be avoided.
It noted that the budget of the ministry is being curtailed every year especially the plan budget (without MPLADS).
The panel asked that the ministry to take up the matter with the finance ministry in this regard.