The Ministry of Statistics and Programme Implementation (MoSPI) has taken a significant step by establishing a 26-member committee tasked with revising the base year for national accounts in India. This initiative aims to enhance the accuracy and relevance of key economic indicators.
The committee is chaired by Biswantah Goldar, a prominent figure in the field, who will guide the members in their efforts to modernize economic measurements.
Currently, many vital economic measures, including the Index of Industrial Production (IIP), Wholesale Price Index (WPI), and National Income, are anchored to the 2011-12 fiscal year. The committee is considering 2020-21 as the new base year for these indices.
In economic terms, a base year functions as a reference point for tracking economic variables and allows for the assessment of the comparative performance of indicators over different periods. It is essential for calculating various economic indices and measuring changes over time.
Regularly updating the base year is crucial as it ensures that economic indices accurately reflect changes in the economy’s structure. This includes shifts in consumption patterns, sector weights, and the incorporation of new sectors. Outdated base years can lead to misinterpretations of economic health.
The committee's responsibilities include advising on the methodology for compiling and presenting National Accounts Statistics, focusing on seasonal adjustment of quarterly accounts, promoting research in this field, and recommending the adoption of the latest UN standards and classifications for developing sector-wise accounts.
The committee is set to serve for a duration of five years or until the completion of the next base year revision, ensuring a structured approach to this significant undertaking.
Among the notable members of the panel are G C Manna (former Director-General of the CSO), Chetan Ghate (Institute of Economic Growth), and Partha Ray (NIBM, Pune), alongside other experts from academic and statistical backgrounds.
The overarching aim of this initiative is to modernize national accounting practices, ensuring they accurately reflect current economic realities and meet global standards. This modernization will ultimately bolster robust research and facilitate effective policy formulation capabilities.
Kutos : AI Assistant!
