Annual Survey of Industries (ASI)

• ASI Frame (Para 5.1.24)
  
  • The Chief Inspectors of Factories (CIFs) should update their own lists by including those units, which ought to be there in the lists and excluding the units that do not operate.
  • The Central Statistical Organisation (CSO) and the National Sample Survey Organisation (NSSO) should take immediate steps to prepare directories of establishments (that employ at least 10 workers) based on data collected in the Fourth Economic Census and the recent Follow-up Enterprise Surveys of Economic Census, respectively so that these could be made use of by the CIFs in their work of updating the lists maintained by them.
  • The work of preparation of a comprehensive frame for selection of samples in the Annual Survey of Industries (ASI) should be taken up jointly as a task on a priority basis by the NSSO and the CSO. This comprehensive frame should be prepared by taking into account the lists maintained by the CIFs, the directories of establishments prepared by the CSO and the NSSO and information available from other sources.
  • The comprehensive frame so prepared should be updated on a continuing basis using survey and census data as well as information available from other sources. The additional resource requirements for carrying out the work should also be met.
  • The State Level Coordination Committee (SLCC) should be reconstituted with the Secretary, Department of Industry, as the Chairman and the Labour Commissioner, Chief Inspector of Factories, Director of Industries, etc. as members so as to ensure greater vigour and discipline in the task of revision of the frames.
  • The CIFs should take steps to simplify the process of de-registration of closed units so that units non-operating for a long time could be removed from the registers of factories of the CIFs.
• Accuracy of the Estimates – Sampling and Non-sampling Errors (Para 5.1.29)
  
  • The effect of the changes made from time to time in the sampling design, including changes in sample size, on survey estimates should be analysed and the findings brought out regularly whenever such changes take place.
  • The sampling errors of estimates of important survey characteristics should be published along with the survey results.
  • The sampling design and the sample size should be reviewed to improve the precision of estimates at industry-group level. There is a need to increase the sample size for at least some of the industries where the sampling errors of the estimates are very high.
  • Non-sampling errors in the data should be regularly studied and measures should be taken to minimise them.
  • Factors responsible for wide divergence of summary or provisional results from detailed or final results need to be identified and steps taken to minimise such divergence.
• One-time Census of Industries (Para 5.1.31)
  
  • A one-time census of industrial units which are eligible for registration should be conducted. While there should be a complete enumeration of all the units already included in the CIF list, the excluded units could be covered either by a sample or on a complete enumeration basis in the census. Such a census will help in generating reliable benchmark estimates at the disaggregated level (by geographical region, industry group, product level, etc.), providing an efficient weighting diagram for revision of the base year of the Index of Industrial Production, and also updating of the ASI frame.
  • Before such a census is launched on a full scale, an exercise on a pilot basis should be carried out to explore the usefulness of the various alternative sources of information for preparing a comprehensive frame, and also to estimate resource requirements for conducting the one-time census.
• Schedule for Data Collection, Computerisation and Use of IT Network (Para 5.1.34)
  
  • The schedule of data collection should be rationalised to make it as respondent-friendly as possible and designed in a computer-readable form.
  • The query, ‘whether the industrial unit can supply ASI data on a floppy on software to be provided’ that formed part of the schedule of ASI 1997-98 but was subsequently dropped should be reintroduced. This would help in identifying units that are capable of furnishing information through floppy or other electronic media.
  • Information on input and output items clubbed under the large ‘others’ category should be obtained in a more disaggregated form through the schedule. Items having importance in value terms, at least, should be separated from ‘others’. This is particularly important for the census sector units.
  • For bringing about further improvement in the quality of data and a timely release of results, the cooperation of the factories should be solicited, through the Industry Associations and Chambers of Commerce, for supplying the required information in a pre-designed format in the electronic media.
  • Steps should be taken for data transmission from factories and field offices of NSSO to the tabulating agency in the form of digitised schedules using the countrywide Information Technology (IT) network.
• Timeliness of Processing (Para 5.1.35)
  
  • Further measures should be taken to ensure the timely processing of data on a regular basis and release of the final results of ASI within one year of commencement of the fieldwork.
  • An advance calendar for release of quick estimates, provisional results, and final results should be declared through appropriate media, including a website.
• State Participation in ASI (Para 5.1.37)
  
  • The existing system of independent tabulation of ASI data by both the agencies should continue.
  • States and Union Territories should canvass the ASI schedules in the residual units (i.e., not covered by the NSSO) in their respective States and Union Territories, either on a sample or on a complete enumeration basis, whenever the required infrastructure and resources are available. For that purpose, the Government of India should declare, under the Collection of Statistics Act the Directors of the States’ Directorates of Economics and Statistics as statistical authority within the respective States, for the collection of ASI data and such other industrial statistics as the Government of India collects in its national programme.

Surveys on Unregistered Manufacture

• Divergence in the Alternative Data Sets (Para 5.2.20)
  
  • Uniform concepts and definitions should be adopted in the censuses and the sample surveys in defining the enterprises and workers. In case of non-uniformity, provisions must be made in the census and survey questionnaires so that it is possible to generate comparable estimates for a cross-examination of data and to take remedial measures in case of divergences in the data.
  • The advisory working groups and technical committees set up by the National Commission on Statistics should ensure standardisation of concepts and definitions in the censuses and sample surveys, to the extent possible.
  • The National Sample Survey Office should regularly study the extent of divergences in the alternative data sets so as to identify the reasons for divergences and suggest remedial measures. As the village and urban block level data of the number of enterprises and workers as per the Economic Census (EC) are used as the sampling frame for selection of villages and urban blocks in the Follow-up Enterprise Surveys, necessary measures must be taken in the EC to enhance the quality of the data.
• Accuracy of the Survey Estimate (Para 5.2.26)
  
  • Standard errors of important estimates should invariably be published in the reports.
  • Post-survey evaluation should be regularly carried out to identify the deficiencies in the survey methodology for the purpose of taking remedial measures.
  • There should be a regular interaction between the survey agencies and the data users to discuss the limitations of survey results with a view to taking necessary corrective steps for improving the quality of survey data.
  • Until action is completed to cover all the bigger units in the ASI frame, steps should be taken in the Follow-up Enterprise Surveys to net such bigger units by proper stratification so as to improve the precision of the survey estimates.
  • Measures such as strengthening of training, field visits and scrutiny of schedules by higher-level officers, interactive feedback session at the initial stage of the survey, etc. should be taken to minimise non-sampling errors in the surveys.
  • Other measures like shortening of schedule and creating public awareness about the data requirements should also be taken to improve the quality of the data.
  • It would be worthwhile to extend the provisions of the Collection of Statistics Act for surveys in respect of unregistered manufacture as well as other sectors as in the case of Annual Survey of Industries.
• Time Frame for Conducting the Surveys (Para 5.2.29)
  
  • The time frame for covering various non-agricultural activities, including unregistered manufacture, through Follow-up Enterprise Surveys (FuS) should be finalised keeping in view the periodicity of data requirements by the users vis-à-vis resources available for handling the survey work.
  • The collection of data relating to all types of unregistered manufacturing enterprises consisting of Own-account Manufacturing Enterprises (OAMEs), Non-directory Manufacturing Establishments (NDMEs) and Directory Manufacturing Establishments (DMEs) should be integrated in the FuS and it should be the responsibility of the NSSO to conduct such surveys, process the results and bring out the reports.
• State Participation (Para 5.2.31)
  
  • Views of the State and Union Territory Governments should be solicited and measures should be taken for improving their data processing capabilities.
  • The State and Union Territory Governments should actively involve the NSSO and the CSO in regular discussions and exchange of ideas for improvement of their system of data processing.

Small Scale Industries (Para 5.3.13)

• The representation of the Small Scale Industries (SSI) sector in the all-India Index of Industrial Production (IIP) should be improved by extending the coverage of items for which Development Commissioner, Small Scale Industries (DCSSI) is collecting regular monthly production data.
• Since the frames maintained by the source agencies do not make a distinction between the registered and unregistered units, a mechanism should be devised to avoid overlapping of units belonging to SSI and other source agencies, in respect of common items for which the production data is reported by two agencies.
• The Office of DCSSI should make efforts to compile monthly IIP as against the present practice of compiling quarterly IIP, for monitoring the trend of the Small Scale Industries. Efforts should be made to enlarge the coverage of items in order to make the index more representative of the SSI sector. The base year of the two indices namely, all-India IIP and DCSSI index should be in close proximity if not the same.
• The Office of DCSSI should publish the index for use by the Government, private agencies and researchers.
• The Economic Census and the Follow-up Enterprise Surveys should collect the information on "investment in plant and machinery (original value)" and "whether registered as SSI unit or not". The Economic Census would help in providing the number of registered and unregistered SSI units while the Follow up Surveys would enable estimation of various parameters of these sectors. Similar information in ASI should also be collected to estimate the different characteristics of registered and unregistered SSI units in the total organised sector.
• With the availability of information on the SSI sector from the Economic Census and Follow-up Enterprise Surveys, as mentioned above, the utility of conducting a future census of small-scale units should be examined. The detailed information, if any, required for the sector could be collected through sample surveys.
• To facilitate evaluation over time, the Office of DCSSI should present data to enable time series comparison keeping in view the changes in the definition of the SSI sector.
• The NSSO as a part of their tabulation programme should generate data on the principal characteristics relating to the SSI sector to enable cross comparison with DCSSI data.
• Though administratively, the Small Scale Sector is divided into seven sub-sectors, which are under the control of different ministries and departments, the Office of DCSSI that is controlling the major segment of this sector, should coordinate with the remaining six departments and generate a database for the sector. Thereafter, efforts should be made to compile an index of the overall Small Scale Sector.

All-India Index of Industrial Production (Para 5.4.17)

• Index of Industrial Production
  
  • Improvements in the Existing IIP
    
    • The item basket of the Index of Industrial Production (IIP) should be selected in such a way that the indices are representative of the growth in the industrial sector at least at the 2-digit level of National Industrial Classification (NIC).
    • The source agencies should make available the data on the additional items to be included in the item basket. The agencies should expand their database to capture new units and new items.
    • To ensure the availability of data on new items, the Central Statistical Organisation (CSO) should regularly provide the source agencies with:
      
      • The list of items that are just below the cut-off criteria of item selection and likely to figure in the revised item basket on the basis of the current series;
      • Items identified on the basis of detailed results of Annual Survey of Industries (ASI).
    • The source agencies should also identify the important and fast-moving items for inclusion in their database for the purposes of administration and revision of IIP.
    • The base year of the Index should be revised quinquennially by the Central Statistical Organisation to adjust to the structural changes in the industrial sector.
  • Strengthening of Source Agencies
    
    • The statistical set-up in Department of Industrial Policy and Promotion (DIPP) needs restructuring in terms of statistical manpower and infrastructure, preferably by creating a full-fledged statistical unit under the overall guidance of a professional statistician.
    • The proposed statistical unit should be vested with the responsibility of maintenance of the frame, timely supply of monthly production data with an adequate response rate, exploring of suitable methodologies for dealing with non-response and improving the overall quality of data.
    • The statistical set-up of other source agencies of the IIP also needs to be adequately strengthened.
    • Since such strengthening will take some time, the agencies should, in the mean time, attempt to achieve a minimum standard for ensuring the quality and reliability of the Index, by adopting a suitable monitoring mechanism to target a response rate in terms of production of at least 60 per cent in the first month and 80 per cent at the final revision.
    • The source agencies should correspond with the production units through fax, e-mail and telephone followed by a personal visit, if necessary, to minimise non-response. Cooperation from the Industrial Associations and State Governments should also be solicited in this context.
    • Source agencies should preferably avoid inclusion of items for which very few units (say, less than 5) are reporting production, in order to avoid extreme fluctuations in the production data due to non-response. If, however, it is necessary to include some such items, the source agencies should make all efforts to closely monitor and collect data for these items.
    • The problem of non-response needs greater and more detailed examination. Therefore, technical experts from the fields of industry and statistics should go into the question of whether statistical methods could be useful for the solution of this problem.
  • Additional All-India Index of Industrial Production
    
    • In view of the difficulties faced in the collection of data for compilation of IIP by the mail enquiry method, the possibilities of constructing an Additional Index of Industrial Production by direct collection of monthly production data on selected items from factories with 200 or more workers should be explored. This should first be done for one year on an experimental basis.
    • For this purpose, the Field Operations Division (FOD) of the National Sample Survey Organisation (NSSO) should be entrusted with the task of collection of monthly production data under the existing legal provisions. The requirement of additional resources for this purpose should be met.
    • Before the above suggestion of compilation of the Index is taken up, a study should be conducted to compare the annual growth rate in production, based on ASI data of recent years (for factories with 200 or more workers) and current IIP. The findings should be examined by the Standing Committee on Industrial Statistics regarding the workability and adoptability of this approach for compilation of the Additional Index of Industrial Production
  • Use of other Administrative Data
    
    • An exploratory study should be undertaken to examine the feasibility of using the production data as available with Central Board of Excise and Customs for compilation of an All-India Index of Industrial Production. The possibility of utilising data from other sources like sales tax for compilation of IIP, at least at the State level, should also be examined.
• Comparable State-level Indices of Industrial Production (Para 5.4.25)
  
  • The present practice of using Gross Value Added (GVA) for preparation of weighting diagram for All-India Index of Industrial Production and Gross Value of Output for State Comparable Indices of Industrial Production would result in incomparability in the two methodologies. GVA should, therefore, be used for the State IIPs.
  • Industrial Associations and State Industry Departments should be requested to impress upon their members and units to cooperate with the State and Union Territory (UT) Governments in supplying regular monthly production data to the State Directorates of Economics and Statistics so that the Comparable State-level Indices can be compiled and released regularly.
  • Coordination mechanism needs to be established between the source agencies and the States and UTs for supply of regular production data.
  • For the purpose of collection of necessary data, the State Directorates of Economics and Statistics (DESs) should be given authority as recommended by the Commission at Serial Number 22 above under State Participation in ASI.
  • Vigorous efforts on the part of the States, with the help of industrial associations and State Industrial Departments, are required to try out the mail methods i.e. fax, e-mail, etc. for collection of regular monthly production data.
  • Additional resources to the States for compilation of State-level Comparable IIPs should be provided.