​Data deficiencies: On India and the IMF’s low grading

The Hindu
The Hindu
1w ago • 14 views
The IMF has given India a 'C' grade for its national accounts statistics, highlighting significant data deficiencies that hinder economic surveillance. This low rating raises concerns about effective policymaking.
​Data deficiencies: On India and the IMF’s low grading
A What happened
The IMF has assigned a 'C' grade to India's national accounts statistics, signaling serious deficiencies in data quality that affect economic monitoring. This grade, the second lowest, raises alarms about India's ability to make informed policy decisions. Key issues include the outdated base year of 2011-12 for major economic indicators like GDP and the Consumer Price Index (CPI). The IMF noted that this outdated data hampers accurate price movement assessments, impacting the Reserve Bank of India's monetary policy. Furthermore, the informal sector's contribution to the economy is poorly captured, which could misrepresent economic growth and the welfare of the population. The Indian government is currently updating its data collection methods, with new series expected to be released in early 2026. The IMF's grading underscores the urgency of addressing these data deficiencies.
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Key insights

  • 1

    Outdated Data Issues: India's economic indicators rely on a base year from 2011-12, leading to inaccuracies.

  • 2

    Informal Sector Challenges: The informal sector's unregistered nature complicates accurate economic assessments.

  • 3

    Upcoming Data Revisions: New methodologies and data series are set to launch in early 2026.

Takeaways

The IMF's low grading of India's national accounts data highlights critical areas for improvement in data accuracy and economic monitoring. Addressing these issues is essential for effective policymaking.

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