Steep Revisions in India’s Import Data Spark Concerns

Sub : Eco

Sec: External sector

Why in the News?

The Directorate General of Commercial Intelligence and Statistics (DGCIS) has significantly revised India’s import data for November 2024 and the cumulative tally from April-November 2024, leading to a downward adjustment of $14 billion in total imports.
This sharp revision, especially in gold and silver imports, has raised concerns among economists and experts regarding the accuracy and transparency of India’s trade statistics.

Context and Key Highlights

India’s gold import data for November 2024 and the April-November 2024 period saw significant downward revisions.
The initial estimate for November 2024 gold imports was $14.86 billion, which was later revised to $9.9 billion, marking a reduction of $5 billion.
Similarly, for the cumulative period of April-November 2024, gold imports were originally reported at $49.1 billion, reflecting a 49% year-on-year increase.
However, the revised figure stands at $37.39 billion, indicating only a 13.5% year-on-year rise and a reduction of $11.7 billion.
Similar revisions have been made in Silver import data and overall Import data.

Overall Trade Deficit Adjustments

The revisions in import data have also impacted India’s trade deficit figures.
For November 2024, the trade deficit was earlier estimated at $37.84 billion, which has now been revised to $31.8 billion.
Despite the revision, November 2024 still records the highest trade deficit to date.
The cumulative impact of these revisions suggests that India’s annual trade deficit will be approximately $14 billion lower than previously estimated.

Concerns raised by Experts

Global Trade Research Initiative:
- Called the revisions a potential “statistical harakiri.”
- Concern: Erodes credibility of India’s economic data among investors and financial markets.
Economists:
- Urged the government to explain the rationale behind these steep adjustments to uphold data transparency and trustworthiness.

Conclusion

The downward revision in import data, primarily driven by gold and silver imports, has lowered India’s trade deficit but raised questions about the reliability and transparency of trade statistics. The government must address concerns and provide clarity to maintain credibility in its economic data.

About Directorate General of Commercial Intelligence and Statistics (DGCIS):

Mandate: The DGCIS is a key agency under the Ministry of Commerce and Industry, Government of India. It is responsible for collecting, compiling, analyzing, and disseminating trade-related statistics.
Established: It was set up in 1955 to ensure the availability of accurate and timely trade data for policy formulation and decision-making.

Key Functions:

Trade Data Collection:
- Gathers data on India’s imports, exports, and trade balance from various ports, customs offices, and other government agencies.
Compilation and Analysis:
- Compiles and processes trade data to provide monthly and annual reports on India’s trade performance.
- Monitors the trends in India’s international trade for informed policymaking.
Publication of Reports:
- Publishes critical documents such as the Monthly Statistics of Foreign Trade in India and the Export Import Data Bank.