The curious case of data reporting

In what questions the way data is reported in the world’s second-fastest growing economy, the directorate of sugar had given data for four months of production, instead of that for a single month. This led to a huge miscalculation in the index of industrial production (IIP) for January.

The directorate, however, did not know it had given the figures for four months, October to January, instead of data for January alone.

The Central Statistics Office (CSO) has now revised its January IIP growth numbers from a staggering 6.8 per cent to 1.1 per cent, a fall of 5.7 percentage points, because of the error. Also, the production of sugar for January was on Thursday scaled down from 13.4 million tonnes to 5.8 million tonnes.

According to officials of the ministry of food and consumer affairs, the error crept in because of a change in guard at the directorate of sugar. A new appointee had sent the sugar production numbers of October-January to the CSO, which had assumed it was the data for January alone, and had used it to calculate the IIP.

“Subsequently, we realised the mistake, apologised for it and sent the correct information to the CSO,” said a senior official. He added the mistake had been rectified and all steps had been taken to ensure such problems did not recur.

CSO officials involved in the process of finalising the industrial production numbers, however, claim all checks and balances were in place. “We invariably go for validation and speak to the reporting agency if the reported data exceeds that for the previous month or that of the year-ago period by 20 per cent,” said a senior official.

The check, however, did not apply to seasonal items like sugar, he added, when reminded it was the seasonal sugar data that had led to the miscalculation.

The other reason for the “inadvertent error” is pressure to release the data on the 12th of every month. “We have to work under some compulsions. There is an issue of a response rate. When we release the quick estimates, the response rate is only about 80 per cent, and this goes up to over 90 per cent by the time we revise the estimates,” the official said.

He added the revised numbers were communicated to the Reserve Bank of India and the ministry of finance a few days earlier to ensure the wrong numbers did not impact calculations for the central bank’s annual policy for the current financial year, slated for April 17.