Central Idea

• The Centre has appointed a panel to review the methodology of the National Statistical Organisation (NSO).
• This step comes amid discussions regarding the accuracy of national surveys such as the National Sample Survey (NSS), National Family Health Survey (NFHS), and Periodic Labour Force Survey (PLFS).

About National Statistical Office (NSO)

Historical Background:

• The NSO was established in 1950 as the Central Statistical Office (CSO) under the Ministry of Planning.
• It was later renamed the National Sample Survey Office (NSSO) in 1970 and subsequently became the NSO in 2019.
• Over the years, it has evolved to become the primary statistical agency in India.

Organizational Structure:

• The NSO consists of several divisions and units responsible for different statistical functions.
• These include the Survey Design and Research Division, Field Operations Division, Data Processing Division, National Accounts Division, Price Statistics Division, and Social Statistics Division, among others.

Key organizations under NSO: Central Statistical Office (CSO)

• The CSO is a part of the NSO and focuses on macroeconomic statistics and national income accounting.
• It is responsible for producing key economic indicators such as the Gross Domestic Product (GDP), Index of Industrial Production (IIP), Consumer Price Index (CPI), and Wholesale Price Index (WPI).

Important Surveys Conducted:

1. Population Census: The NSO conducts a decennial Population Census in collaboration with the Registrar General and Census Commissioner of India. The census collects data on population size, composition, and other demographic characteristics.
2. National Sample Survey (NSS): The NSS is a large-scale household survey conducted by the NSO to collect data on various socio-economic aspects. It provides valuable information on employment, consumer expenditure, poverty, education, health, and other important indicators.
3. Economic Census: The NSO conducts the Economic Census periodically to collect data on the number of business establishments, their distribution across sectors and regions, employment, and other relevant economic variables.
4. Annual Survey of Industries (ASI): The ASI is conducted by the NSO to collect data on the performance and structure of the industrial sector in India. It covers various aspects such as employment, wages, production, and financial indicators.
5. Agricultural Census: The NSO conducts the Agricultural Census periodically to collect comprehensive data on agricultural holdings, cropping patterns, land use, irrigation, livestock, and other relevant agricultural variables.
6. Health and Morbidity Survey: The NSO conducts surveys on health and morbidity to gather data on healthcare utilization, access to healthcare services, prevalence of diseases, and other health-related indicators.

Why under review?

• Concerns about Methodology: Experts argue that the usage of outdated survey methodology in national surveys may have systematically underestimated India’s development.
• Narrower capture of data: The dynamic nature of the Indian economy over the last 30 years might not be adequately captured.
• Different Perspectives: While some experts believe there is no systematic underestimation of development by these surveys, they acknowledge the presence of errors that should be minimized.
• Role of National Data: Accurate national-level data is crucial for research, policymaking, and development planning.

Focus on NFHS Data

• Crucial development data: The National Family Health Survey provides vital data on health and family welfare indicators.
• Claims of Bias: Some experts suggest that national surveys, including NFHS, may exhibit a “rural bias” in representation, leading to an underestimation of India’s development.
• Issue of Error and Random Bias: While errors in population estimations have occurred in some rounds, they appear to be random rather than systematic.

Minimizing Errors in Data Collection

• Improving Response Rates: Efforts to increase response rates in both rural and urban areas can lead to more accurate data.
• Importance of Sample Weights: Proper assignment of sample weights can significantly improve the accuracy of estimations and correct any underrepresentation of rural or urban populations.

Recommendations for the Review Panel:

• Addressing Concerns: The review panel should focus on ensuring that the samples are adequately representative rather than proposing a complete overhaul of survey methodologies.
• Correcting Bias Where It Exists: While addressing any perceived biases, the panel should aim to eliminate bias where it genuinely exists without introducing new biases in policymaking and planning.

Conclusion

• Accurate data serves as the bedrock of progress and development in the country.
• Reviewing the methodology of national surveys is vital to ensure accurate and representative data for India’s development.
• Striking the right balance between addressing concerns and minimizing errors will lead to more informed decision-making and policy formulation.

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