India Correcting Factory Data Twice in Day Stokes Quality Worry
India corrected its latest report on industrial production twice just a day after publishing the data, stoking concern over the quality of pivotal economic figures.
Output rose 2.3 percent in April from a year earlier, higher than the 2 percent first reported, the Statistics Ministry said today. A statement two-and-a-half hours earlier put the expansion at 2.2 percent. Errors in electricity production inputs led to the revisions, the ministry said.
Official data that are often incomplete or months out of date contribute to a statistical fog that adds to the challenge of assessing Asia’s third-largest economy. Reserve Bank of India Governor Duvvuri Subbarao has said the nation’s policy makers have to contend with both an uncertain future and an uncertain past because of more frequent revisions than elsewhere.
“Industrial-production data quality was always suspect and something needs to be done,” said Prasanna Ananthasubramanian, an economist at ICICI Securities Primary Dealership Ltd. in Mumbai. “Data quality in general needs to improve.”
The government must focus on getting factory-output (INPIINDY) growth reports right as they are a key input for working out initial gross domestic product figures, he said.
The changed report shows industrial-production growth was still slower than March’s 3.4 percent pace. The median estimate in a Bloomberg News survey was for an expansion of 2.4 percent.
In April last year, government revisions cut January 2012’s factory-output growth to 1.1 percent from 6.8 percent after an error was found in sugar output calculations.
“Macroeconomic statistics are adequate for surveillance, but weaknesses remain in the timeliness and coverage of certain statistical series,” the International Monetary Fund said in a report in February.