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Posts Tagged ‘statistics

Visiting our total household food budget

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RG_pvt_final_cons_exp

Twice as much over the 11 years until 2009-10, and three times as much over the 10 years until 2012-13. That has been the increase in rupee expenditure for this basket of foods.

The data is from the private final consumption series, calculated by the Central Statistics Office (CSO) of the Ministry of Statistics and Programme Implementation (MoSPI). The totals (left scale of the chart) is in thousand crore rupees.

In this chart I have shown the expenditure (in current rupees) for: Cereals and Bread, Pulses, Sugar and Gur, Oils and Oilseeds, Fruits and Vegetables, Milk and Milk Products, and Meat Egg and Fish. These totals also indicate the size in rupees of the food industry – but do not include the processed and packaged food industry.

The rise in consumption expenditure expressed in rupees is a money measure alone, and not a quantity or volume measure. We can see that the portion of milk and milk products in this group has gone up from just over 18% to 25% over 14 years, and the portion of meat, eggs and fish has gone up from just under 9% to 12.5% over the same period.

From 2006 the rising trend of expenditure on fruits and vegetables became steeper than the rising trend of cereals and bread. In 2005-06 the portion spent on fruit and vegetables in this group was just over 26% and that has risen slightly to 28% in 2012-13. In contrast for cereals and bread, the portion of 27.5% in 2005-06 has dropped to just over 21% in 2012-13.

Expanding India’s WPI, neglecting its CPI

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There are some 130 food items in the proposed WPI whereas the retail price collection basket with the most items has only 46.

There are some 130 food items in the proposed WPI whereas the retail price collection basket with the most items has only 46.

The Planning Commission is to agree by the end of 2014 March on the composition of an expanded set of items for the wholesale price index. The expanded index – with a few new categories and some reclassifications – is a proposal, formally, by the Office of the Economic Adviser, Ministry of Commerce and Industry.

But there are retail wheels within wholesale ones, and there are indications provided by the financial and business press that it is the Prime Minister’s Office that is backing the revision – which will also allow the Reserve Bank of India to make decisions about interest rates that could benefit industry.

My interest was drawn to the several additions that have been made to the category of ‘food articles’ (some of which has been covered by media reportage, which quite typically has ignored the changes proposed in the rest of the categories). More important than these few changes to the components of wholesale food price are the additions made under the ‘manufactured products – food products’ category.

This is a greater expansion of items (although the weightages for the new items have not yet been made public) and reflects the shift in what is being purchased by households – more packaged and processed food in place of raw cereals, pulses, fruit and vegetables. The expanded list also signals the dietary shift – a nutritional time-bomb whose effects can already be seen in the rising rates of youth becoming overweight – towards processed cereals, sugary drinks, edible oils, and snack foods.

The tall and narrow chart you see here shows the difference between the sets of items covered by the proposed new WPI and the current sets of items that are monitored for consumer retail prices. The three sets that do this are from: (1) the Ministry of Agriculture, Directorate of Economics and Statistics, (2) Ministry of Labour and Employment, Labour Bureau, and (3) Ministry of Consumer Affairs, Food and Public Distribution, Department of Consumer Affairs.

This is the second expansion in the number of items that make up the WPI in the last three years, whereas the relatively much smaller list of items that are used to monitor the prices of food for consumers has remained the same over the same period (the last revision was about five years ago in the Ministry of CAF&PD system).

As usual, there is little or no public discussion on the additions to the WPI and the continuing neglect of the items that are used to compute the consumer price index – some of those collection systems are 30 years old. The proposed expansion of the WPI food and food-related items will deepen the already very serious lack of correspondence between the WPI and CPI.

More troubling is the deepening meaninglessness of the CPI numbers – rural and urban for major states doesn’t help one bit if the list of items is not expanded to reflect more accurately what households actually buy, rather than ignore the growing list of items they do. Continuing to ignore this long overdue need for correction will short-change India’s salaried workers and wage earners, and very seriously under-report true inflation especially for food.

Concerning the Bank of Upper India, Meerut, 1915

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Old banking stats from 1915 show financial crisis back then too.You can see the difference when there is a certain kind of central banking cadre which is proud of the work it does. Take the Reserve Bank of India’s banking statistics. Although immensely useful to those in the banking and finance industry, and just as useful to those who draw the links between how money is spent and development programmes, hundreds and hundreds of rows and columns filled with numbers to the third decimal are – let’s face it – hardly as exciting as a Twenty20 game.

Enter a dash of history. The conservatively titled regular publication, ‘Statistical Tables Relating to Banks in India 2008-09’, reminds us stolidly that it provides “information on major items such as liabilities and assets, income and expenses, non-performing assets, financial ratios, spatial distribution of offices, number of employees and details of priority sector advances. It also provides bank group-wise monthly data on some of the major items such as aggregate deposits, liabilities to the banking system, assets with the banking system, investments, bank credit, and, sector-wise and industry-wise gross bank credit”.

And then it smoothly brings in the historical view (see pic left). “This publication had started prior to the establishment of the Reserve Bank of India. The first issue was brought out by the then Department of Statistics, Government of India in 1915 which covered data for 1914 and was brought out under the guidance of Mr. G. Findlay Shirras, the then Director of Statistics, Government of India. It is worth mentioning that Late Professor P. R. Brahmananda dedicated his book ‘Money, Income, Prices in 19th Century India’, published in 2001, to Mr. G. Findlay Shirras, among others. In order to commemorate the origin of this publication, the cover page of the first issue brought out in 1915 is reproduced in this volume.”

Reserve Bank of India digs out banking stats from 1915What an evocative cover page it is (see pic right)! The foreword continues: “The work relating to the publication was transferred to the Reserve Bank of India in 1939. The last issue, which incidentally was also the 25th issue, of the publication brought out by the Government of India was in 1941, with data pertaining to 1938. The first issue under the aegis of the Reserve Bank of India was brought out in 1941, with data pertaining to 1939 and 1940. The cover page of the last issue brought out by the Government of India and ‘Prefatory Note’ in the first issue brought out by the Reserve Bank of India as reproduced in Statistical Tables Relating to Banks in India 2005-06 are also given in this volume.”

“This is the 64th volume of the publication by the Reserve Bank of India,” say this issue’s authors. “If we count volumes published by the then Department of Statistics, Government of India, then this could be the 89th volume, marking the long history of continuity of this publication. This publication has continued for nearly a century underscores its relevance. It is also a tribute to the efforts and dedication of concerned officials first in the Government of India and now in the Reserve Bank of India.” Hear, hear. This volume has been brought out under the guidance of Dr. A. M. Pedgaonkar, Principal Adviser, and Dr. Balwant Singh, Adviser, DSIM, and for their historically sensitive presentation alone they deserve to take a bow.