District domestic product estimation to be better

NEW DELHI: India’s official statistical machinery is set to better its estimation of district domestic products (DDP), with the availability of more granular data in the new GDP series, statistics secretary Saurabh Garg told TOI.

“We have given more focus on having more granular data in this series, so that state domestic products are captured much more effectively. We are also moving towards better estimations of district domestic products, which we hope to work with the state govt in the coming months,” Garg said.

At present, DDP is estimated by relying on top-down allocation methods, proportionately distributing state GDP to districts based on demographic indicators like population. This results in ‘near-identical’ growth rates for districts, masking true inter-district disparities, the vast informal sector and local shocks to the economy.

Accurate DDP estimates can enable targeted policy interventions by identifying laggard districts and better assessment of regional inequality and employment trends. The responsibility for calculating DDP lies with the directorates of economics and statistics (DES) of the respective state govts, under the technical guidance of the National Statistical Office (NSO).

“We want to do this in conjunction with the states because that’s where the real policy decisions are, and they have also shown great enthusiasm for this. We will continue to bring out national and state level GDP figures, but we are also working with the states to replace the top-down allocation-based approach with a bottom-up approach,” Garg said.

The availability and integration of new data sources like annual survey on unincorporated sector enterprises (ASUSE) which covers the vast informal manufacturing and services sector and periodic labour force survey (PLFS) in the new GDP series will better capture data on the labour side and the activities of all households, micro, nano and small enterprises which at the district level are the main establishments.