Estimates of National Income


Pre-Independence: No central author-ity or government organization in India before independence to prepare National Income Estimates.

Independence: Estimates of National In-come and Per Capita Income of India.

Estimated By Year of Estimates National Income (Crore) Per Capita Income
Dadabhai Naoroji 1867-68 340 20
Wadia and Joshi 1913-14 1,067 44
Shah and Khambata 1921-22 2,364 74
V.K.R.V.Rao 1931-32 1,689 62
Ministry of Commerce (Govt. of India) 1945-46 6,234 198

Post-independence: P.C. Mahalanobis was the Chairman of the National Income Committee constituted in 1949. According to its first report in 1951, National In-come of India was 8,710 Crore and Per Capita Income was 225 in 1948-49.

national-income

Difficulties in Measuring National Income in India

  • Non-monetized Sector.
  • Lack of distinct differentiation in economic activities.
  • Conceptual problems
  • Black money
  • Inter-regional differences
  • Non-availability of data about certain incomes.
  • Mass Illiteracy
  • Difficulty in obtaining data about income
  • Difficulties of sampling technique

Significance:

  • Indicates economic growth
  • Helps in policy formulation
  • Inter-sectoral comparisons
  • Helpful in trade union
  • Distribution of income
  • Helpful in economic planning
  • Structural changes in the economy
  • Facilitates forecasting
    • “Green accounting” means measuring the national income of a country taking into account estimation of pollution and environmental damage.
    • The estimates of National Income in India are prepared by Central Statistical Organization (CSO) and are called National Accounts Statistics.

Annual growth rate of National Income and Per Capita Income

Plan National Income (%) p.a. Per Capita Income (%) p.a.
First Plan 3.6 1.8
Second Plan 4.1 2.0
Third Plan 2.5 0.2
Fourth Plan 3.3 1.0
Fifth Plan 5.0 2.7
Sixth Plan 5.4 3.2
Seventh Plan 5.8 3.6
Eighth Plan 6.7 4.6
Ninth Plan 5.5 3.5
Tenth Plan 7.8 6.1
Eleventh Plan 7.9 6.5
Twelfth Plan (2012-13) 5.0 3.7