A committee headed by Planning Commission member Saumitra Chaudhuri has, called for a complete revamp of the index of industrial production (IIP) to make it truly representative by correcting inaccuracies.
The committee has suggested guidelines for the 16 source agencies to improve data collection and reporting.
"We have recommended a complete overhaul of the IIP, which came under fire for volatility and accuracy concerns. We have revised not only the base year but also how data should be collected and processed," said a government official, who is a member of the committee.
Half of the IIP data is provided by the department of industrial policy and promotion (DIPP) while the rest comes from other departments of various ministries.
The revised index will become operational next year onwards.
The items in the index will be revised on an annual basis, instead of after every five years, along with the base revision. New items could be added while the outdated ones will be removed from the list.
The panel has recommended that the base year of IIP be revised from 2004-05 to 2011-12, more than doubling the number of items covered to ensure a truer picture of industrial activity in the country.
Under the revised index of industrial production, the weight of manufacturing will rise to about 80 per cent, up from 75 per cent weight in the current series of IIP.