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13 Dec 2025 : A critical story that a chunk of the media missed

 Editorial 2: ​A critical story that a chunk of the media missed

Context

The International Monetary Fund’s assessment of India’s national accounts data raises serious concerns.

 

Introduction

The recent release of Quarter 2 national accounts data came alongside pointed concerns raised by the International Monetary Fund (IMF) over India’s methodology for compiling economic statistics. The IMF has assigned India’s national accounts, including GDP and GVA, a C grade, the second-lowest rating. Although Q2 recorded an unexpectedly strong 8.2% growth, the IMF’s reservations have received limited public attention.

  • Media coverage of the IMF’s observations was largely absent, leading to limited public awareness.
  • Only one national daily, The Hindu, reported the issue prominently as a front-page story (“IMF gives ‘C’ grade for India’s national accounts statistics”, November 28, 2025).
  • The business newspapers (pink papers), which should have shown the greatest interest, mostly overlooked the report.
  • A few outlets did carry the story, but buried it in inside pages, a choice that appeared unusual and difficult to justify.


An issue

  • The IMF’s grading of India’s national accounts statistics is a serious concern, particularly regarding the methodology used to compute GDP.
  • India estimates growth in the informal/unorganised sector by using the formal organised sector as a proxy.
  • However, even after excluding agriculture, the unorganised sector accounts for nearly 30% of GDP.
  • This raises a fundamental question: do we truly have a reliable and accurate measurement framework for such a large segment of the economy, or is the estimate largely an informed approximation?

 

Why India’s GDP Estimates Raise Reliability Concerns

  • Pronab Sen and Arun Kumar describe the use of the organised sector as a proxy for the unorganised sector as a less than reliable method.
  • The approach assumes both sectors move in the same direction, an assumption that fails during economic shocks.
  • During demonetisation, GST rollout, and the COVID-19 pandemic, the organised sector grew while the unorganised sector declined, causing overestimation of unorganised sector performance.
  • Consequently, headline figures such as 8.2% quarterly GDP growth need caution.
  • As Sen notes, quarterly GDP estimates rely heavily on assumptions, since comprehensive quarterly data are unavailable.
  • Without robust, real-time data collection, concerns over GDP accuracy will remain.

 

Why the IMF’s Concerns Are Unlikely to Be Resolved Soon

  • The IMF’s concern, reflected in the low ‘C’ grade, is structural and cannot be fixed quickly.
  • Although the Union Ministry of Statistics and Programme Implementation is updating the GDP base year and methodology, with a new series expected by February next year, doubts remain.
  • The core question is whether these changes will meaningfully improve estimates of the unorganised sector.
  • Pronab Sen is unequivocal, stating, “I don’t think we can,” when asked if India can adequately address the IMF’s concerns.
  • This issue matters because the media’s role is to inform, analyse, and explain such critical developments.
  • When major concerns are ignored or underplayed, citizens remain uninformed and ill-equipped to understand economic realities.
  • Such neglect reflects a failure of journalism, an outcome that ultimately harms public discourse and accountability.

 

Conclusion

In the end, the IMF’s concerns highlight deeper structural weaknesses in India’s economic data system that cannot be corrected quickly. Updating methodology alone will not ensure accuracy, especially for the unorganised sector. When such issues are under-reported, public understanding suffers, weakening informed debate, policy scrutiny, and the media’s role as a critical watchdog.