Tuesday, 18 October, 2011

World Statistics Day, or, Shooting in the Dark


20 October 2011 is World Statistics Day and I am tempted to comment and to provoke the industry with which I have been associated for over forty years — as a printer, publicist and publisher. These days I am not as isolated as I once was. I am not the only person decrying the lack of social conscience or a practical sense of community in the Indian printing industry.

In our research company IppStar, I often comment on the unreliability of government data, even GDP statistics and the RBI data, but I do not speak too loudly since my area is the print industry where I am more sure of the numbers which are based on a huge amount of face to face interviews of expert informants, as well as a healthily sceptical analysis of secondary data. I must admit that the general scepticism comes from our detailed work in the printing, packaging and publishing domain. The particular seems to give insight to the general and so we largely ignore the almost daily announcements of GDP projections and industrial data ups and downs.

On 17 October 2011, a young colleague who is an avid reader of the Economic Times brought me a clipping from the morning’s paper of an article by Mythili Bhusnurmath titled Economic Policy: Shooting in the Dark. She writes, “What was India's gross domestic product (GDP) growth rate during the first quarter of the year? Is industrial production rising or falling? What about services? What is the inflation rate? Is it rising or falling? The list can go on and on. For, the truth, unpalatable as it might be, is we really don’t know. “As a result, economic policy formulation has become more like a game of shooting in the dark. Policy authorities don't know which way to turn in a scenario where the three pillars of a sound statistical database — credibility, timeliness and adequacy — are absent.”

Bhusnurmath goes on to point out that even monetary policy decisions on serious issues such as inflation are being made on the basis of very poor data since there is very little real investment in the actual ground research. She writes, “Garbage in, garbage out! The RBI, in fact, has paid a heavy price for its reliance on dodgy data. As RBI governor D Subbarao pointed out in a recent speech, ‘Policy is framed real time and if the provisional data that these are based on are inaccurate, the resultant policies can turn out to be suboptimal choices.’”

So the printing industry is not alone in its ignorance of real data or its lack of investment in data collection, compilation and research. Nevertheless, to me it seems a miracle that bank loans for print projects upwards of Rs. 40 crore are approved mainly on the basis of relationships and trust since the data available is really quite sketchy. Of course our multi-client industry research has subscribers but in our current project every subscriber is a multinational company. Not a single Indian company or organisation is supporting a massive effort that could actually make their projects and growth viable.
What I have written may sound like a plug for IppStar’s research and why not? While a few leading printers actually support IppStar in its work, many more call us up for a few hints about the industry data. And many more ‘borrow’ it without acknowledgement (even for a Red Herring prospectus for an IPO) and sometimes even print our research articles in their association magazines without even a phone call or an email!

Like shooting in the dark, borrowing is our thing. I receive calls from Indian students every month who are doing a thesis in some foreign university. Investing in data and research doesn’t really seem to be our thing whether it is the government or industry or the individual. Actually our industry is vibrant and could easily play a leading role by investing in real on-the-ground statistical work. Perhaps this is something that the so-called leaders of the print industry can think about on World Statistics Day.
 Naresh Khanna editor@ippgroup.in

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