After recording a decade’s low of 5% in FY13, India's GDP growth is unlikely to recover quickly and would remain subdued at 5-5.5% in FY14, the finance ministry said recently. A hike in the salaries of government staff is likely to give a boost to FY16 GDP if the Centre implements the recommendations of the newly set-up seventh pay commission from January 2016. Inclusion of new manufactured products in the IIP and GDP data when it is updated with a base year revision is also likely to reflect positively on the economic data. TCA Anant, India's chief statistician and secretary at the ministry of statistics and programme implementation, tells FE's Raj Kumar Ray that the GDP data series with a new base year (2011-12) will be available by 2015. He, however, cautioned that IIP and GDP may not show a significant change after inclusion of some of the highest-selling industrial items such as smart-phones, micro-ovens and tablets if the domestic value addition is low.
When is the new base revision coming up for GDP, IIP and WPI?
We are planning a base year revision and update of data for GDP and IIP. The new base year for GDP will be 2011-12. We are hoping to put them in place by 2015. The commerce ministry will be doing the same for WPI.
Some of the highest-selling consumer goods items such as smartphones, micro-ovens and tablets are not included in the IIP basket at present. Will these products be included in the IIP when the new series come up?
I can't give you details of what items will be included in the next series of IIP. A committee under Dr Saumitra Chaudhuri is identifying the criteria. Since IIP is a production data, the idea is to capture as many items as feasible, in terms of volume and value.
The IIP basket is updated in terms of the production strength. What is relevant is the domestic value addition. Imports are not part of IIP.
If a item is mostly manufactured abroad and you just put a sticker here and sell it, that will not come in IIP. However, a domestic production can include imported components.
Coming back to your question on highest-selling items, there could be an item with very high domestic sales but less of domestic value addition. So, we need to see the extent of domestic value addition before we jump into a