The government has set up a high-powered committee to critically review the available estimates of domestic and national savings and investment in the Indian economy.
The panel headed by Dr C Rangarajan, chairman of the Economic Advisory Council (EAC), is expected to submit its report within six months.
The Indian economy has grown by 9% annually for the last three years. This trend has made it necessary to review the savings and investment pattern as well as their estimation and methodology.
The committee will also examine if rapid financial deepening in the economy is getting duly reflected in the estimates of financial savings and suggest improvements, RBI said in a statement.
Dr R B Barman, executive director, RBI will work as member secretary of the panel. The other members of the committee include Dr Kirit Parikh, member, Planning Commission, Prof Ravindra Dholakia, IIM, Ahmedabad, Dr S L Shetty, EPW Research Foundation, Mumbai and Dr Saumitra Chaudhuri, member of the EAC. The committee will also examine the feasibility of directly estimating household savings through integrated income and expenditure surveys and also assess savings in the farm sector.
Rangarajan panel will study the feasibility of estimating corporate savings on marked to market basis or use the present book value method. It would also suggest improvements in the methods and procedures used in the estimation of corporate investment and savings, it added.
The panel is also tasked with responsibility to suggest method to strengthen public sector savings and investment estimates. It will take into account savings and investment estimates of municipalities, city corporations, gram panchayats and other local governments on the one hand and increased private participation in public investment on the other.
The panel is also expected to suggest new databases that could be developed to improve the reliability and check validity of the estimates.