IMF Rates India’s National Accounts Data ‘C’ in Article IV
Why in the news
The IMF graded India’s GDP and GVA statistics ‘C’, saying shortcomings hamper effective surveillance.
Key facts
- Four grades exist: A, B, C, D; ‘C’ means data shortcomings hamper surveillance; overall data quality is ‘B’.
- India’s main method is the income approach; expenditure approach is supplementary.
- Gaps arise from different sources, coverage and limited visibility of the informal sector.
| Weakness | Why it matters |
|---|---|
| Base year 2011–12 | GDP less reflective of current consumption, production, technology |
| WPI deflator (no PPI) | Weakens real GDP accuracy in a services-led economy |
| Production vs expenditure GDP gaps | Thin expenditure data; informal sector under-captured |
Exam angle
- Review: IMF Article IV.
- IMF advice: update the base year.