Following widespread doubts about the credibility of India's most recent GDP numbers, the country's chief statistician TCA Anant has admitted the quarterly data indicators currently in use for GDP estimation are "limited" in nature.
Anant told the Indian Express that "more complete information" would become available next year, adding that revisions could be made in areas where data becomes available.
India posted a strong 7 per cent growth in its most recent third quarter, showing sharp growth in several sectors that have previously reported a hit by demonetisation, according to estimates by the Reserve Bank of India and India's Economic Survey. The latest numbers largely ignored the impact from demonetisation and the resulting cash crunch that has severely hit many sectors, particularly the informal economy, which makes up about 40 per cent of India's GDP.
Anant, who is open to widening data collection methods should they become available, noted that India doesn't directly track its informal sector and lacks reliable direct measures as most of the informal sector doesn't maintain regular accounts.
As a result, it uses indirect measures in the agriculture, trade, construction and manufacturing sectors to come up with an estimate. It also uses "proxies" such as tax to calculate how trade fared, and cement and steel sales to asses consumption levels.
Economists have cast doubts over the most recent numbers and are starting to use their own measures to keep track of India's growth.