Economic Census may hold key to future reforms

New Delhi, June 11: The Fifth Economic Census, to be unveiled tomorrow, may hold the key to the future of economic reforms, with crucial and perhaps controversial data relating to poverty reduction, industrial growth and employment generation in industrial enterprises during the period 1998-2005 as well as Advanced Estimates of some key parameters.

The findings of the Census become more meaningful in the backdrop of indications from the National Sample Survey Organisation (NSSO) survey for 1998-2004 suggesting that poverty reduction was much less than what was projected by the champions of the reforms during the National Democratic Alliance (NDA) regime.

Sources say data indicates that poverty reduction during 1998-2004 was less than one per cent per annum and not 1.65 per cent as projected by the protagonists of reforms during the NDA government.

The Census, which is being brought forth after a gap of six years, will reveal the state of the industry during the same period. It would make clear whether industry benefitted from the reforms or whether its fate was similar to that of the poor record on poverty reduction.

Certainly, if industrial growth across the board is found to be healthy, then conclusion can be reached that reforms have been pro-rich and anti-poor.

This would strengthen the hands of the anti-reformists and be a source of embarrassment for the reformists.

The findings of the Census will also have an impact on the Approach Paper to the Eleventh Plan, now under preparation.

According to informed sources, the Approach Paper is being developed keeping in view the slow pace of poverty redressal, but the industrial trend and its impact on employment generation was not being considered in its formulation. At a gala event tomorrow morning at the SCOPE Auditorium, Minister for Statistics and Programme Implementaion G K Wasan will release the provisional results of the 'Economic Census 2005.' Analysts say the two major surveys -- Economic Census 2005 and NSSO data (2000-04) -- together are likely to be a statement on the reform process. They may, in fact, have a crucial bearing on the future of reforms.

The kind of indications which are likely to emanate -- as can be interpreted from the healthy growth of the GDP during the period -- show that the task of accelerating reforms would become a more difficult one for the Manmohan Singh government, but strengthen the hands of the Left and the critics of liberalisation.

Another important trend that will emerge from the surveys would be the impact of modernisation on employment. An acceleration of industrial growth without concomitant increase in employment could backfire on reforms.

The first economic survey was conducted in 1977 and the present one will give a complete count of all entrepreneurial units in the country.

The current Census will also cover all agricultural and non-farm enterprises, except those engaged in crop production and plantation.

Significantly, for the first time, Intelligent Character Recognition (ICR) technology has been adopted for processing the census data.

As per the last count, there were 30.35 million enterprises in the country engaged in different economic activities other than crop production and plantation. Of these, 17.71 million enterprises (58 per cent) were located in rural areas and the remaining 12.64 million (41.7 per cent) in urban areas.

During 1990-1998 enterprises logged a growth rate of 2.36 per cent. The total number of people working in all enterprises was 83 million, of which about 40 million were in rural areas. Among the wealth of data generated, the focus will be on the extent of growth of three non-agricultural activity groups -- retail trade; community, social and personal services; and manufacturing -- regarded the most important activity groups in terms of number of enterpises and employment after agriculture.

The three groups together account for about 84 per cent of the total number of non-agricultural enterprises and 83 per cent of the total employment in the non-agricultural sector.

Though agriculture continues to be the mainstay of majority of the Indian population, the issue that deserves attention is whether there has been a shift from agriculture to non-agricultural enterprises, earlier found to be in the ratio of 1:8.

The survey will report figures relating to the number of enterprises having perennial activities, those located in rural areas, those operating without premises, number of those operating under private ownership, extent of hired labour, percentage of women workers, and the number of enterprises which use power or are without it and use fuel for carrying out economic activities.

In 1977, the first Economic Census was restricted to only non-agricultural enterprises employing at least one hired worker on a fairly regular basis.

The Fourth Economic Census, carried out in 1998, was an expansion of coverage of items reported in the second and third Census and included all agricultural and non-farm enterprises, except those engaged in crop production and plantation.

UNI