National accounts statistics-overestimated or underestimated?

The building bricks for the compilation of National Accounts Statistics (NAS) are drawn from various sources differing in scope and coverage, and also using the results of sample surveys of unincorporated enterprises. As the true value of any component in the macroeconomic identities in the NAS is not known, discrepancies in the interrelationships of the variables will be a natural corollary. As such, underestimation/overestimation of the macro economic aggregates is somewhat illusory. In this paper, the aggregates of credit instruments presented in the Sequence of accounts (SOA) in NAS for the entire economy are compared with those in the Reserve Bank of India (RBI) Financial Flows Accounts. As the RBI Data releases on company finances for recent years are stated to be drawn from the Ministry of Corporate Affairs data base (MCA-21) as in the case of NAS, the estimates of Private Non- Financial Corporations (PNFC) from the two sources are, prima facie, expected to tally roughly, but wide differences are noticed, and possible reasons thereof are indicated. The problems in using the results of the multi subject surveys for deriving accounts of the Quasi Corporations (QC) for insertion in the PNFC accounts, are also discussed. Though the statistical system in any country is not tailor made to arrive at an ideal System of National Accounts (SNA), the focus should be on improvement of data base, refining the methodology from time to time, conducting additional sample surveys etc. These aspects are delineated in this paper.