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Introduction

P.M. Mathew

1.0. Background

The perspectives on globalisation differ. While a section of people considers it as a reality which has to be politically confronted, the other viewpoint is that, one has to learn to live with it. The changes taking place in the world economy and society, and of Kerala in specific, in the first decade of the 21st century, are much more rapid than in the past. Globalisation has much adverse effects on Kerala, though in some sectors, it has made some positive contributions. However, the challenge of modern times is to quickly adjust to these rapid changes, against the background of the wider objective of social policy in our country. Obviously, hard data, and information emerging from that, are vital tools for realistic planning and programme implementation. They should also form the armoury of a political activist.

2.0. Rationale of the Conference

The Kerala economy is at cross roads. The State has been on the frontline in terms of the development of physical and social infrastructure and in human development. However, in the coming years, the State need to focus increasingly on the sustainability of this model. Kerala needs innovative methods of management of its economy as well as of design and implementation of development programmes. However, any such reform can trickle down and get reflected in the lives of its people positively, only through unleashing the repressed productive forces and entrepreneurial energies in various sectors of the economy. This can be achieved only through the active participation of different sections of the people, well informed and with enhanced morale.

To realise the above objectives, we need to have a clear understanding of not only the constraints of today, but also a clear vision on the future scenario. Hard data and information on the State's economy and society, and a realistic understanding of its performance and interdependencies, are vital.

The recent fiscal crisis in Kerala has attracted the attention of both amateurs and professionals alike, and methods were explored to overcome this crisis. While, at the political level, opinions are divided on both the causatives as well as policy options, two official documents of the Government of Kerala became points of enhanced attention: The White Paper on State Finances, brought out by the new government in power, discussed in detail the present state of state finances as well as its causatives and imperatives. The second document, entitled, "Modernising Governance", painted the Government's vision on governance, as well as the steps envisaged to improve the existing order of things. While opinions at the political and academic levels are divided on the analytical positions and policy options, the reality remains that our understanding of different sectors and economic activities of the State remain far from satisfactory, essentially because of lack of a database which is essentially demand-driven.

The existing perception on database of the Kerala economy is not much demand-driven. Official data emerges largely as a byproduct of planning and programme implementation, rather than as an indispensable input demanded by policy makers and programme implementing agencies. It is now time for a paradigm shift. In a rapidly changing world, data and information cost significantly in terms of time and money. Collection of data is costly. Inadequate data, and data collected at the inappropriate time (with time lag) are costlier and are much less useful, or even useless.
What is the data and information that we should have on a particular sector or activity? The answer to this question cannot be made simply by the State Planning Board or the Directorate of Economics and Statistics. The demand for data arises from our perception on what type of development we want. Therefore, for example, what data should be collected on the IT sector, depends on how we perceive the role and relevance of the IT sector in Kerala's development. If so, we require an interactive process of academics, planners, administrators, businessmen, non-governmental organisations, financial institutions etc., who perceive the IT sector from their own angles. But these perceptions become a full circle of policy, only when realistic data are collected. This is applicable to other sectors of the economy as well.

This perspective and the quest for a new paradigm, guided the theme of this Conference. Its deliberations did not focus simply on the various available data sources and their narration. The focus was on the inadequacies and gaps as well as the poor quality of available data, which needed to be corrected. The Conference was meant to lead to new methods of collection of data and their processing, new mechanisms, new methods of dissemination of data and a further look at the existing data collection machinery. The thrust of the Conference was that, the understanding of the planner need to be increasingly grounded on ground realities. It can come only through an interactive process, with the active involvement of participants from both the demand and supply sides of database in the State.

This perception is shared both by the State Planning Board and the Institute of Small Enterprises and Development. It was against this background that this 'Conference on Database of the Kerala Economy' was jointly organised by these two institutions at Cochin on August 14, 2002. It was supported by the Planning Commission, the United Nations Development Programme (UNDP), financial institutions and various Departments of the Government of India and Government of Kerala.

3.0. Objective

The objective of this Conference was to highlight what we know about Kerala, and what we further need to know about the State, in order to make it more prosperous and developed. Thus, it focused on the present database as well as the data gaps of Kerala's crucial developmental sectors.

4.0. Participants

The participants of over one hundred numbers included, businessmen, academicians, policy makers, and representatives of financial institutions, non-governmental organizations and international development support agencies.

5.0. Summary of Discussions

The discussions of the Conference were arranged in the following three sessions:

This three-fold arrangement was based on a demand-driven perspective on database in the Kerala context. The conventional text bookish categorisation of the economy does not help us much to understand the demand-supply situation relating to data. On the other hand, it is necessary to identify the core developmental sectors and sub-sectors in which Kerala is interested in, as per its development priorities. Thus, while agriculture is important in the Kerala economy, we need to understand more in detail on vital sectors like biotechnology, organic farming etc. While the service sectors like banking and health care are crucial, special thrust on venture capital, micro finance and ICT are needed today. Moreover, it is not a mechanical segregation of the economist's sectors, but the developmental aspirations of the people which should have primacy in our development agenda. Therefore, despite its significant overlaps with the earlier two sessions, the Conference had a separate session on 'Decentralisation and Development'.

A look at the database of Kerala, on the above lines, is a reflection of both our development imperatives as well as dissatisfaction with our inadequate information on the system in which we live in. Data obviously is only a very early stage of information. But, it cannot simply provide us information. Data can lead us to information, only according to our development perspectives. A discussion on database, therefore, is primarily a discussion on our development perspectives.

5.1. The Economic Sectors

Out of the six papers in this session, there were two papers on industry, and one each on agriculture, energy, fisheries and commercial taxes. The two industry papers are, one about medium and large industries and the other one on small-scale industries. P Mohanan Pillai provides an overview of data resources on organised industry, the data gaps and the constraints in making available reliable data on the sector. He has listed eight different types of data sources: (1) Central Statistical Organisation; (2) Reserve bank of India; (3) Industrial credit and Investment Corporation; (4) Bombay Stock Exchange; (5) Centre for Monitoring Indian Economy; (6) Department of Company Affairs; (7) Department of Industrial Policy and Promotion; (8) Department of Public Enterprises.

The above listing by Pillai is in a pre-reform context. Since the 1990s, one need to really address to the emerging issues in the areas of large and medium industries; there are constraints on data availability as well. Pillai rightly pointed out this problem. The data collection mechanism in this sub-sector, e.g., Annual Survey of Industries, and most such data sources on industries, are heavily based on reporting by individual industries. If one juxtaposes at the different sources like, ASI, CSO, NSSO, one can see lot of discrepancies. Ideally one should get a very strong correlation between the growth rate calculated from ASI data, the CSOs and other sources. But there are lots of discrepancies there, if one looks into the different types of data. If one looks into the small and large industries, the major problem relates to the incentives for reporting. Dr. Pillai points out that just good intentions are not enough for getting good data.

The paper is on small-scale industries by P M Mathew, touches upon much broader issues. He has very good analytical points in his paper. Researchers are mainly focusing the supply side problems. In most cases, we are focusing on the supply side issues, and supply side issues also without much regard to the cost aspect of data, which is vital. Mathew focuses on the demand side. One can generate all kinds of data at any cost, but one has to optimize. Optimization is very important in the case of the data generation process. Besides, there is the question of uncoordinated data. There are several agencies to collect data, but all are uncoordinated. Supply side people are not sensitive to the demand side, because we have a very elaborate statistical system. But, the basic problem is on the demand side itself; the researchers do not demand, exactly what they want. At the end of his paper Mathew highlights the need for coordinated effort and he is suggesting to try to build up the kind of demand-driven database. The problem according to him, is not lack of data, but uncoordinated data. What is important is to develop a systematic demand pattern.

The paper on agriculture and allied activities by M. Mohandas, puts in tremendous effort to list out all the possible sources of data on agriculture and allied activities. Unlike industry, there is coexistence of a central and state-level data system in agriculture. But, in case of agriculture we have certain flexibility in data generation. For example, Cost of Cultivation studies were actually motivated by the Agricultural Prices Commission. In the case of most of the other data sources, infact, the State has lot of flexibility. The question then is, why not we think about the specificity of the State? According to him, agriculture should be viewed in a much broader context of bio-diversity and overall natural resource management. Mohandas's paper picks up, quite few very important gaps in our database on agriculture and allied activities. We do not, for example, have any information on the real wages. These can be captured only through the work of individual researchers. Researchers can collect lot of data on their own small way. From them, we will get some ideas, what to do, and what not to do. But the overall purpose still remains policy planning and, policy interventions. The role of individual researches should be limited the aspects, such as, an overall policy perspective and perspective on natural resource management.

Demand for data is of two types: The researcher's demand is only one. This may look into certain relationships, which are very interesting and have policy implications. From the researchers side, where, even if it is not directly relevant for policy purposes, still there is much importance. So this importance should not actually be sidelined. Both these aspects should be taken into account while the data generating process is discussed. In many cases, it is just the reallocation of the resources, rather than fresh data that is needed. According to Mohan Das, data on trade related statistics is not so satisfactory. Mohan Das attempts to refocus the agricultural statistics in the State from the conventional crop-cutting studies to more broader issues.

The paper on energy by P P Pillai highlights the piecemeal approach to energy. When we talk about energy, we just focus on KSEB. Energy means electricity and electricity means what? KSEB. If we talk about energy planning, it requires much more information, which KSEB throws up. Because of the talk about the State Electricity Boards, many researchers have come up with the findings about the State Electricity Boards. Pillai carries the discussion from this lower level, to wider issues, one cannot talk about substitutability within the energy sector unless one have a concrete status on different sources of energy and the demand pattern. The data on electricity in the State is basically based on KSEB. Outside the KSEB, there is no real sources of data to discuss upon.

In fisheries data, according to K.T. Thomson, there are different sources like State Fisheries Department, the Central Marine Fisheries Research Institute (CMFRI), the Fisheries Survey of India (FSI), the Marine Products Development Agency (MPEDA) and Non Governmental Organisations (NGOs). The major problem in this area is the institutional conflicts. It is this institutional conflict, which affects the lives of fisherman. Though such institutional aspects are latent in several records of the State Fisheries Department, unfortunately, the researchers are not getting such information, atleast from the State Fisheries Department. Such paradoxical situation is most pronounced in fisheries sector. Thomson raises a very valid point that without such data on institutions, and conflicts in the fisheries sector, it is difficult to analyse the issues, nor is it possible to chalk out meaningful policies. While many such data are available with the files of the Fisheries department, they are not available to the researchers.

An information system based on commercial taxes is, though a narrower area, is very vital for meaningful planning on commercial taxes. Infact, data on commercial taxes are very much part of the process of tax collection itself, and therefore, the possibilities of streamlining them to the requirements of planning is much easier. N. Ramalingam advocates the need for a computer based information system, which should be a more transparent means of understanding the tax regime of the State.

Despite, the difference in thrusts, all the six papers in this session give strong analytical insights into the data generating process. Data generation is not simply a process of churning out figures. It has to take into account both the demand and supply situation. The importance of the presentations in the session is that these two aspects have been effectively dealt with in all the papers.

5.2. The Services Sector

School education is a major area of experiments in Kerala. The recent experience in this sector has been the mushrooming of unaided schools. The impact of this mushrooming on school education, as a whole has not received adequate attention. Data relating to the unrecognised schools in Kerala is totally weak. Available data furnished by the Directorate of Public Instruction, does not give any picture on the structure and organisations of schools as well as their ownership.

Another crucial issue relates to the emergence of parallel education. Parallel colleges and tutorial institutions have added to the supply of education in the State to a significant context. But unfortunately, data/information on the quantitative and qualitative aspects of parallel education remains weak.

The private cost of education incurred by the parents, is an issue which has not got reflected in official statistics. Official statistics deal only with the public cost of education which, to a large extent, is just notional. Private, public and institutional cost of education need to be understood in the specific context of Kerala's social development. Unfortunately, we do not have any relevant database relating to this aspect. Besides, the private financing of education is another crucial area of recent importance. It is important that data relating to this sector are collected.

Data on the health care sector also have several constraints. Age-specific data on the beneficiaries of the traditional system of medicine are not available. A demand for data should be generated through the Civil Registration System. This will provide much insights into vital statistics in a comparative perspective. The civil registration system will be helpful to collect data at the panchayathee level, and this would be highly useful under a system of decentralised governance. Kerala has already reached the last stage of demographic transition. But the epidemiological transition is more significant. The State is fast moving from communicable diseases to non-communicable diseases. This has significant implications on the quality of population, the problem of the aged etc. Adult mortality is also increasing. These lead us to the need for a new set of data at the district level, data on mortality with special focus on adult mortality, has to be collected.

Information Technology is increasingly used as a means of development. But, despite the achievement of Kerala in this area, we do not have any database on the supply and demand for IT professionals in the State. Being a dynamic and vibrant sector, data on this sector has to be collected on a regular basis. Data requirement relating to IT are immense. The focus of policy today is to create infrastructure such as Technoparks and Electronic Parks. But, what is the volume of technically skilled manpower in Kerala in terms of their background and skills. Can the turnouts from the engineering colleges be absorbed by the Technoparks and Electronic Parks? Or how much of such Parks or other infrastructure has to be created in order to fully absorb the present level of turnouts. It is incorrect to say that, data available from government sources are incorrect and useless. In sectors like Information Technology, only the little official data available from the Ministry of Information Technology is used by entrepreneurs now. What is needed now is to supplement such initiative through partnerships between governmental agencies and other than governmental agencies.

There is no reliable data on trade in Kerala. Data on inter-state movements of goods also are not reliable. Common practices like under invoicing, defeat even the very purpose of the available data. Under invoicing of imports and over invoicing of exports also are widespread. The discussions relating to agriculture and trade during recent times, has been shrouded by mis-conceptions. This has been demonstrated in the meetings of the WTO Committee on Agriculture appointed by the Government of Kerala. There is absolute lack of data relating to agricultural trade. Such a cloudy scene has led to lot of criticisms on WTO as the villain. However, it is vital that data relating to international trade in commodities is very important in the modern context of globalisation. Regarding internal trade also, it is necessary to have relevant data on production, local consumption and inter-state trade in commodities. Shyamasundaran Nair, based on his experience with the WTO Committee, highlights the need for a knowledge-base to help monitor the pregression of the WTO regime.

An important constraint relates to lack of utilisation of data collected by private organisations like Chambers of Commerce and institutions. Some mechanism of consolidation and coordination of data need to be worked out. All relevant data should come to a central agency, which should be the focal point.

According to K.A. Joseph, venture capital, being a new area in the Kerala context, the database available is extremely poor. The vital data needed by a venture capitalist are: How many entrepreneurs can come into this area? How many having a potential for expansion?, Which are the potential ventures?, Who are the potential entrepreneurs?. It is also necessary to have an evaluation of possibilities for outsourcing. The venture capitalist also need industry profiles, on which he can anchor his efforts to identify suitable investors. Above all, the need of a venture capitalist is a solid database on the industrial sector, the canvas on which the venture capitalist can draw his picture.

In the modern era, the difference between media and academics is coming down significantly. From this angle, there is lot of opportunities for generating new data, which are relevant to the context and requirements of the media. E-business is one area in which much data is required. Similarly, data relating to the structure of viewers/readers on a regular basis are likely to be useful for the media. Cheriyan Punnathara points out that the needs of the media and of academics are distinct. But there is substantial need and scope for cooperation between the two.

5.3. Decentralisation and Development

The demand for data has undergone a significant paradigm shift over the last 50 years. During the days of Mahalanobis, the data required were largely relating to macro aggregates as vital inputs for macro planning. We are now in an era of decentralised development in which data required are of a greater disaggregatred level: on resources, flow of resources, local trade etc., and also of vital areas like eco-systems and environment.

Decentralisation does not mean any significant change in income earning opportunities or livelihood strategies. On the other hand, it implies major changes at the organisational level, relating to firms, communities and governance. The days of the individual firm are gone. Strategies involving enhanced networking and collective action have become the rule of the day. Firms operate increasingly in a culture of competition along with cooperation with other firms of different, but related competencies and skills. Poor people have discovered that the opportunities offered by the non-agricultural sector have enhanced, and therefore, there is a need for moving away from wage labour to non-farm activities. They have also found that the minimum viable size of a firm can be meaningfully achieved through new forms of organisation, such as Self-Help Groups (of various firms). They have also found that, the old legal and institutional framework associated with cooperatives have become unhelpful to their interests, and therefore, organisational innovations are needed. Political parties and movements have found that, the political aspirations of the people now are not highly driven by ideology as in the past, and the urge for immediate goals have increasingly influenced political decision making. Hence, panchayathi raj became the political order of the day with the associated legal and institutional framework, as well as collective strategies for income generation and distribution. It is this new realisation relating to governance, which has shaped development projects and programmes since the 1990s. It is such developmental imperatives, which should influence the supply side of data today.

The six papers in this session raises much relevant issues relating to the demand as well as the supply side of the problem, as well as the areas of gap. K. M. George, in his paper raises a fundamental question as to the purpose of data collection. There are two positions of data: some people say that the present database is enough; others says it is not. The discussion of the paper is in the context of poverty data. Is the available data adequate? Adequacy depends on the question, for what purpose the data is used? He says, the debate should start from the end-use of data. Most discussions get stuck on the adequacy of sample size etc. The questions raised are, whether the sample is too small or sufficient. But, the more crucial question is, why is the sample taken at all. Ultimately, it depends on what types of projects we are going to implement, based on such data. Collection of data is costly. Therefore, one need to take care of two points: (1) the cost-benefit calculation of data collection; (2) the timeliness of presentation of data. What is the point in publishing some poverty data, after the death of the poor themselves? Similarly, it is also meaningfulness to collect all types of data. One has to be choosy. The focus should be on publishing of data at the earliest.

Poverty eradication through the enterprise route has become the corner-stone of the economics of decentralised governance. While since the 1960s, when poverty became a major subject of debate in India, the government as well as the non-governmental organisations were subjected to a "bandwagon effect" of anti-poverty programmes. It was in a sense, a confession of the social system itself regarding its inability to assure minimum levels of living to its people. Naturally, while the reluctance of the social system to accept radical changes prevailed, a 'project approach' to poverty reduction was inaugurated in the country. Under decentralised governance, what we find today is not a process of collective decision making by the people who are well informed about their environment. On the other hand, projects are designed for the poor by governmental agencies and NGOs. From the point of view of translating these various programmes into a truly participative nature, the database has to be restructured and strengthened accordingly.

Most of the interventions addressed to the interests of rural poor have a common frame, though many projects are present. Besides, there is also a heavy gender-bias in these activities. Therefore, from the point of view of strengthening the database, we need to evolve a common system which pools together data from these different sources. The paper by Martin Patrick indicates, how poor the situation is, as it relates to the publicly funded micro enterprise development programmes in the State. Even while, several of these programmes are being implemented in the State, our understanding of this sub-sector of the economy remains far from satisfactory. Strictly speaking, no systematic data are available on micro enterprises. Various sources like NSS, EMI and SIDO provide some insights. Some State level sources like Kudumbashree also are available.

The constraints relating to data on the micro enterprise sector are varied. Data on informal sector data are available from 1977 onwards. (Source: Economic Census). But much time lag is there. Besides, there is no comparability of NSS and Census data. Original sources like District Industries Centres and the Labour Offices do not maintain proper records. In the informal sector, at least some data is available only on informal manufacturing units. But these do not provide us a comprehensive picture of the micro enterprise sector.

The process of decentralisation in Kerala, which took a new turn under the Ninth Five Year Plan, created a greater awareness on the need for data at the grass root level. Though the initiatives taken during the Ninth Plan for the creation of a database at the grass root level were not adequate, this awareness has helped significantly to orient the discussion towards a demand-driven approach. Jose Chathukulam and P.M. Joseph points out that, from the point of view of local level planning, diverse data sources are already available. These include: Census Reports, Basic data register of agriculture offices, Village Office Register, Panchayath Offices, Veterinary Hospitals, Public Health Centres, Education Department, Electricity Offices, Rural Development Department. The authors points out that the village level data in Kerala is rich. There may be some inaccuracies. But the user, if he is careful, can use these data. Panchayath level gender development and human development index can be prepared. This will immensely help planning exercises.

A major feature of the panchayathi raj era in Kerala has been the changes that have taken place in the area of rural organisation. The remarkable changes are, the emergence of new firms of organisation such as Self-help Groups and various forms of Farmers and Workers Associations, which do not fall under the purview of the relatively stringent provisions of the Kerala Cooperative Act and Rules. Despite such rapid changes, the cooperative sector still holds political visibility as well as economic strength. Padmini and Nair provides a detailed overview of the cooperative sector in the State as well as the various data sources which provide insights into the structure and performance of this sector. However, they point out that, the available database is inadequate from the point of view of further studies. For instance, NABARD, which has significant access to data on various types of cooperatives, does not provide any clear product-wise or activity-wise data. Besides, the mis-match between data brought out by the NABARD and the State Planning Board also has been noted. In the case of industrial cooperatives, only elementary data are provided, and this does not help one to undertake detailed studies on their economic performance, an area which has been totally neglected is employment data relating to cooperatives. Though, these organisational forms play a crucial role in the rural economy of the State, there is no way to assess the contribution of the sector to the state domestic product. Padmini and Nair also points out the lack of coordination among the multiplicity of agencies which bring out data on the cooperative sector.

In the context of decentralisation and local level development, it is necessary to bringing the gender dimension as a major point. This is because, development is a process were the energies and morale of the community as a whole has to be triggered. Here, gender discrimination should not act as a constraint. Mridul Eapen discusses the issue at the macro-context of globalisation and the Structural Adjustment Programme. She notes that, despite the initiatives for collection of gender-segregated data over the last two and half decades, there is still a gender blindness of our data systems. According to her, an awareness of gender roles can contribute to generating data not only to understand gender differentiated impact of macro policy, but also for formulating gender sensitive policy more capable of provisioning human needs and enhancing human capacities. Eapen points out that despite the possibilities of bringing out gender segregated data, many of the data sources such as the several rounds of the NSSO are conspicuous by their absence of gender differentiation. Gender budgeting is an area which is rapidly gaining ground. However, no attempt in this direction has been taken so far in Kerala.

6.0. Conclusions and Recommendations