Indian Macro-Economic Data Base in a Consistency Accounting Framework (1950-51 to 1997-98) - II

Despite certain minor problems of definitions and measurements left unresolved by the earlier exercise on Indian macro-economic data base consistency (reported in the previous issue of EPW), the resulting integration helped us to detect the structural changes that have occurred in the real and financial sectors of the Indian economy over the entire sample period, in general, and between the pre- and post-liberalisation phases, in particular. In such a context, we have identified many important empirical patterns and regularities, notably the existence of business cycles, the counter-cyclical nature of inflation, the twin deficits problem, the impact of absorption on reserves, the evolution of the debt-income ratio, the relationship between real interest rates and growth, the sustainability of the fiscal stance, amongst others, which could act as theoretical guideposts for the formulation of issues in the role and conduct of macro-economic stabilisation policy.