The International Monetary Fund (IMF) has delivered a nuanced assessment of India's economic data, assigning it a 'C' grade for national account statistics. This critique, emerging just as India celebrated a stellar 8.2% GDP growth for the second quarter of 2025-26, serves not as a cause for alarm but as a constructive prompt to enhance the country's statistical framework.
The IMF's Assessment and India's Stellar Growth
The IMF's Annual Staff Report for India, part of its 2025 Article IV consultation, was released shortly before the Ministry of Statistics and Programme Implementation (MoSPI) announced the impressive 8.2% growth figure—the highest in six quarters and the fastest among major economies. Despite this strong performance, the Fund retained its 'C' rating on a scale from A to D. It noted that Indian data possesses "some shortcomings that somewhat hamper surveillance." While this statement is deliberately broad, it underscores the ongoing global scrutiny of India's macroeconomic estimates.
A Push for Better Methodology and Transparency
The central question arising from the IMF's review is not whether India's data is revised—such revisions are common globally—but whether these revisions are free from political influence and if the system is proactively improving. Evidence suggests affirmative answers on both fronts. Unlike past instances in countries like Greece or Argentina, India has not been accused of data manipulation. More importantly, MoSPI has initiated significant remedial work to upgrade key indicators.
Major updates are underway for critical indexes. The Consumer Price Index (CPI) is set for a major overhaul, shifting its base year from 2011-12 to 2022-23 and updating its item basket based on the latest Household Consumption Expenditure Survey. The Index of Industrial Production (IIP) is also slated for change. For GDP estimation, a crucial survey of the services sector—which constitutes nearly 60% of the economy—has been launched to address previous estimation gaps.
Building a Robust Data Foundation for Policy
Timely and reliable statistics form the bedrock of sound economic policy. India has made strides in this area: the Periodic Labour Force Survey is now conducted monthly, providing a clearer picture of unemployment, and the survey of unincorporated enterprises offers better insights into the vast informal sector. Crucially, informal sector data, previously captured only during base revisions, will now be collected regularly, leading to more robust GDP estimates.
Challenges remain, including concerns about the deflator used to calculate real GDP growth and the coverage of informal activity. These warrant either methodological fixes or clearer explanatory notes from MoSPI. However, the ministry's recent efforts to enhance public communication are commendable. Furthermore, India's political establishment deserves credit for maintaining statistical independence, avoiding the kind of political interference seen elsewhere, such as in the United States under the previous administration.
In conclusion, the IMF's 'C' grade is a mirror held up to India's statistical system, reflecting areas for refinement rather than fundamental failure. The process of improvement is already in motion. As India continues its ascent as a major global economy, the parallel journey of refining its data quality is essential for informed policymaking and sustaining international credibility.
