National Income, GDP Accounting & Economic Planning
National income accounting and economic planning provide the quantitative foundation for measuring India's macroeconomic performance. National income aggregates—including Gross Domestic Product (GDP), Gross National Product (GNP), and Net National Product (NNP) at market prices and factor costs—are computed by the National Statistical Office (NSO) using production, income, and expenditure methods. India's historical economic trajectory was guided by twelve Five-Year Plans (1951–2017) formulated by the Planning Commission, transitioning from the Harrod-Domar agriculture model (First Plan) and Mahalanobis heavy-industry strategy (Second Plan) to post-1991 market-oriented liberalizations. In 2015, NITI Aayog replaced the Planning Commission to foster cooperative federalism and evidence-based strategic development.
Key Concepts & Examination Highlights
- The First Five-Year Plan (1951–56) was based on the Harrod-Domar model, prioritizing agricultural development and irrigation projects.
- The Second Five-Year Plan (1956–61) followed the PC Mahalanobis model, emphasizing rapid industrialization and heavy capital goods.
- Gross Domestic Product (GDP) measures the total monetary value of all final goods and services produced within a country's domestic borders in a year.
- NITI Aayog uses 3-year Action Agendas, 7-year Strategies, and 15-year Vision Documents instead of five-year centralized plans.