India Monthly Index
Note: As of April 2014, we are no longer using Consensus Economics forecaster dispersion data and solely constructing indices based on newspaper articles. This has a limited impact upon our overall country-level series, with the old and the new index having a high correlation. For users interesting in comparing the historical performance of the two series, we will continue to supply forecaster dispersion and overall EPU index data up through April 2014 on this website.
To measure policy-related economic uncertainty for India, we construct an index based on newspaper articles regarding policy uncertainty.
News coverage about policy-related economic uncertainty
We construct the news-based Indian EPU index following the same approach as we use for American newspapers in our monthly US EPU Index. We include 7 Indian newspapers: The Economic Times, the Times of India, the Hindustan Times, the Hindu, the Statesman, the Indian Express, and the Financial Express. For each paper, we count the number of news articles containing at least one term from each of three term sets. The first set is uncertain, uncertainties, or uncertainty. The second set is economic or economy. The third set consists of policy relevant terms such as 'regulation', 'central bank', 'monetary policy', 'policymakers', 'deficit', 'legislation', and 'fiscal policy'.
We scale the monthly EPU article counts by the number of all articles in the same newspaper and month. We then normalize the time-series standard deviation of scaled article counts to 1 prior to 2011 for each newspaper separately. Next, we sum the normalized, scaled counts across the 7 newspapers month-by-month. Finally, we re-normalize the resulting sum to achieve a mean of 100 prior to 2011. This final step yields our news-based EPU index component for India.
Each paper-specific series is normalized to standard deviation 1 prior to 2011. Once normalized, the 7 newspaper-specific indices are then summed. The resulting series is then normalized to mean 100 prior to 2011.
With each monthly update, data from the preceding two months may be revised slightly, as well. This is driven by the fact that some online newspapers do not immediately update their online archives with all articles, leading to slightly changing totals for the previous 1-2 months.
An older vintage of the index, including data from Consensus Economics through March 2014, is also found in the downloadable data above.