Economic Survey 2005-2006

Lyndon Johnson once said that making a speech on economics is a lot like pissing down your leg. It seems hot to you, but it never does to anyone else. But reading economics is just the other way round. It seems hot to others, but not you. Unfortunately, this week I faced a Hobson’s choice of reading the Economic Survey 2005-2006.

Now, don’t get scared. I am not going to give you any prodigal prophesies of the Indian Economy that I derived from the report. I am too dumb to do that. I am just going to tell you how the report on one of the most watched economies of the world is defended from being read. Yes, how the Finance Minister (Henceforth to be called as FM) and his team makes lives of innocent people like me really miserable.

Essentially, the report has two levels of defense. The outer line of defense is the presentation [Strategy 1 and 2], while verbal jugglery [Strategy 3, 4 and 5]is the inner one. The first one aims at preventing you from reading, while the second one ensures that you don’t get the picture, even if you read. Not even a faint one.

Strategy 1: All the statistical tables are to be compiled and published at the end

When those creatures appear together, they look more repulsive and no one dares to even see them, let alone read. The fonts should be microscopic to ensure that the person who reads would require a Braille version of the report next year. As many entries as possible should have superscripts like @,#,$,* etc. If you have exhausted that, then you can go for numbers. You have infinite of them.

My personal suggestion: To make the tables more disgusting, centre justify the figures. That would cause the decimal points to appear at different locations in a column, making comparisons more confusing.

Strategy 2: Avoid using reader-friendly visual statistical representation

The report has just 17 graphs and 0 pie-chart. Compare this to the 63 tables in the report and another 117 pages for tables in the appendix.

The Lesson: Make the report utterly boring and optically dangerous, by avoiding diagrams and filling it up with infinite tables with the data. For effective effects, use font size 2.

Strategy 3: Show Potentials in Failures

In 2005-06, while the direct transfers from State Governments to SEBs was Rs.11,562 crore, an uncovered subsidy of Rs.15,987 crore remained, indicating the large potential that reforms have in improving not only the electricity sector itself but also the fiscal position of the States. – Pg-177.

Electricity reforms were initiated in many states ages ago. In some like Andhra Pradesh, they began as early as 1999. More than half a decade. And still you have uncovered subsidies. That means tardy implementation. But our FM sees “large potential”. Is that what they teach at the Harvard?

Strategy 4: When comparing, use the lowest figures of your predecessor, even if the performance in all the other years were better yours

Expenditure on the social sector as a proportion of GDP has also gone up from 5.68 per cent in 2003-04 to 5.81 per cent in 2005-06 (BE). – Pg - 205

The NDA government’s spending (as a proportion of GDP) in the years 2000-01, 2001-02 and 2002-03 were much higher than the present Government. But the FM chooses the lowest figure in the previous regime to make the comparison. Further, NDA’s are actual figures, where as this is just Budget Estimates. But who cares. The Finance Ministry is so confident about Indians’ Arithmophobia that they would not look up to the tables even when the corresponding text is given right below.

Strategy 5: Liberally use various adjectives for the figures like, Actuals, Budget Estimate, Revised Estimate, Provisional, Quick Estimates to confuse people

NPE 1986 had set a goal of expenditure on education of 6 per cent of the GDP. As against this target, the combined total expenditure on education by Central and State Governments was 3.49 per cent of GDP in 2004-05(BE).– Pg -210

Wondering where that figure “3.49” propped up from?. After all, it is not there in any of the columns in the above table. Well, 3.49% is the Budget Estimate, while the table gives you Revised Estimate for 2004-05. What was the necessity to use the Budget Estimate when the Revised Estimate for the year was available? It is plain statistical fraud.

I understand that the publication is intended for an economist. But, when we talk of transparent administration, simpler procedures and effective communication, I expect that a report of such importance should be presented in a manner where any person with basic knowledge of arithmetic would be able to get the broad picture. I am sure it would not cost them a bomb to a) Increase font size of data b) Use more pie-charts and bar graphs to enable easy comparisons c) Print additional 10 or 20 pages explaining the terms and acronyms used in simpler language. It is high time that our kids are released from the fear of mathematics and our adults from that of economics.

What is worse is that it has become a vehicle for political propaganda by using mischievous comparisons and deceptive terms.

P.S. Now don’t feel the survey is absolutely boring. It has its own genre of practical jokes.

Construction work at greenfield airports of international standards at Hyderabad and Bangalore has commenced. The two airports are likely to be operational by the middle of 2008. – Pg-193

And one exclusively for Bangloreans.

The Government of Karnataka proposed Bangalore MRTS with East-West (18.1 Km.) and North-South (14.9 km.) metro corridors. The project proposal was considered by the Public Investment Board (PIB) which cleared it for an estimated current cost of Rs.5,453 crore with a Government of India participation of 20 per cent. The matter is being placed before Cabinet Committee on Economic Affairs (CCEA). Meanwhile a Group of Ministers has been set up to decide upon the gauge and legal issues for various Metro Railway projects.-Pg-198

OK. You are asking me when that would be? That would be on Date of Inauguration of Bangalore Airport + 420 years. Provided Kumarappa’s son does not dislodge him and, the “Group of Ministers” are not disqualified or do not resign due to some sting operation or office-of-profit bogey.