KARACHI, July 15: The Social Policy and Development Centre (SPDC) has raised questions on the credibility of data made available by the government in the Economic Survey 2003-04 on re-basing of national accounts and on THE findings of the hastily done poverty survey in April-May just before the budget 2004-05.

Conceding that the re-basing of the national accounts with a comprehensive coverage of the economy was overdue, Social Policy and Development Centre managing director Kaiser Bengali in a presentation on Thursday pointed out that the government should have made public, well in advance, the methodological details of the re-basing exercise and the GDP, and sectoral and sub-sectoral rates should have been made available under the 1980-81 base.

"This would have enabled a comparison growth rates under the old and new regimes," the SPDC review given to journalists at a presentation said. The SPDC publication on the budget 2004-05 review quotes a large number of instances where data and information appear to be incomprehensible and could not be analyzed because the methodological details are still awaited.

Without mentioning it directly, the SPDC document questions the government's claim of 6.4pc growth as it estimates about one-fifth of the increase in GDP and investment on account of inclusion of new economic activities and changes in computation methodology and the rest due to a change in the base.

The re-basing of the national accounts has propelled investment/GDP ratio from 15 percentage range to 18 percentage range. Capital formation in certain sectors has been found encouraging but is dismal in agriculture where it declined by 6.1 per cent.

Touching on the export structure, the SPDC managing director said that textile share in the exports had increased from 63.6 per cent to 65 per cent, indicating that the export base was consistently moving towards the concentration rather than diversification that "constitutes a point of caution".

In the textiles sector, low value products like yarn and cloth figure prominently and readymade garments, a labour intensive and value added, registered a 7.5 per cent decline.

He said the rising import bill had widened the trade imbalance in 2004, reducing the current account surplus to $1.36 billion from $2.70 billion. "If growth tempo is maintained, the current account surplus may be converted into negative and you may have to draw foreign exchange from the reserves," Kaiser Bengali warned.