Govt may shift base year to FY23 or FY24

Govt may shift base year to FY23 or FY24

NEW DELHI: The base year for most Indian economic data could be revised to 2022-23 or 2023-24 depending on the results of the Household Consumption Expenditure Surveys done during these two years.

The National Statistical Survey Office (NSSO) has done two back-to-back surveys for determining the monthly consumption expenditure of households -- one in 2022-23 and another in 2023-24. The result of the first one has already come out, and the second one is expected in 3-6 months, government sources told this newspaper.

“Depending on the results of the two household consumption data, the government would fix the new base year. The data for the year which captures the ground realities better would be chosen as the new base year,” a government official said. Currently, the base year is 2011-12, and there has been a demand for revising the base year, which is used for comparison of economic data like GDP, retail and wholesale inflation, etc. The NSSO had planned to do two successive surveys for Household Consumption Expenditure surveys -- one in 2020-21 and another in 2021-22. However, due to the outbreak of Covid pandemic, the surveys had to be postponed by two years.

Former chief statistician Pronab Sen told this newspaper that the base year should be a year which is a normal year and there are no economic shocks during the year, and therefore, either of the two years – 2022-23 and 2023-24 – can be the base year.

According to him, the NSSO changed the methodology of the surveys, and therefore, to check the ‘stability’ of the data they did two back-to-back surveys. “Under the new methodology, the NSSO surveyors pay visits to the households three times unlike once in the past. It is possible the questions are answered by three different members of the same household giving significantly different answers. This could make the data unreliable,” said Sen.

The household consumption expenditure survey is conducted every five year. The last survey was held in 2016-17, but the report was held back by the government.

Information collected in the household consumption survey is useful for understanding the consumption and expenditure pattern, standard of living and well-being of the households. Besides, annual household consumption data provides budget shares of different commodity groups which are used for preparation of weighting diagram for compilation of official consumer Price Indices (CPIs). The data collected through these surveys are also utilized for deriving various other macroeconomic indicators.