Which of the following is NOT correct with regards to the history of calculating National Income (NI) in India?
- (a)Dadabhai Naoroji divided the Indian economy into two parts: primary sector and
- (b)First attempt to compute NI was made by Dadabhai Naoroji.
- (c)First official attempt to compute NI was made by PC Mahalanobis.
- (d)First scientific method to compute NI was used by Dr VKRV Rao.
Answer
Why
Correct — A. The stem asks for the statement that is NOT correct, so the three sound milestones have to be knocked out first.
Dadabhai Naoroji made the first attempt to estimate India's national income, so (b) stands. The first official estimate came from the National Income Committee set up in 1949 under P.C. Mahalanobis, so (c) stands.
Dr V.K.R.V. Rao's estimate for 1931-32 is the one called the first scientific attempt, so (d) stands.
That leaves option (a), the statement about how Naoroji split the economy, as the one the key marks incorrect.
Why the others are wrong
- (b)First attempt to compute NI was made by Dadabhai Naoroji. — Naoroji is the accepted first estimator of Indian national income, putting per capita income at about Rs 20 for 1867-68. The statement is true, so it is not the one to pick.
- (c)First official attempt to compute NI was made by PC Mahalanobis. — The National Income Committee, appointed in 1949 with P.C. Mahalanobis as chairman, produced the first official estimates after independence. True, and therefore not the answer.
- (d)First scientific method to compute NI was used by Dr VKRV Rao. — Dr V.K.R.V. Rao's estimate for 1931-32 is the one textbooks call the first scientific attempt at Indian national income. Again a correct statement, so it fails the NOT test.
Concept
India's national income was estimated privately long before it was estimated officially. Dadabhai Naoroji opened the line in the 1860s as part of his drain-of-wealth argument, and a run of colonial-era estimates followed, all of them the work of individuals rather than of the state.
Dr V.K.R.V. Rao's estimate for 1931-32 is treated as the first methodologically sound attempt. Official estimation began only after independence, with the National Income Committee of 1949, and the Central Statistical Organisation later took over the annual series.
Option (a) is truncated in the candidate's response sheet, which stops the sentence at primary sector and.
The card therefore rests on the three statements that can be checked rather than on the missing tail of (a) — which is also how you would work it in the hall, since (b), (c) and (d) are each standard textbook facts.
Key facts
- Dadabhai Naoroji made the first attempt to estimate India's national income, putting per capita income at about Rs 20 for 1867-68.
- Dr V.K.R.V. Rao's estimate for 1931-32 is regarded as the first scientific estimate of Indian national income.
- The National Income Committee, set up in 1949 under P.C. Mahalanobis, made the first official estimate of national income in India.
- Naoroji set out his drain-of-wealth critique in the book Poverty and Un-British Rule in India.
Study next
Common traps
- Reading the stem as 'which is correct' and picking the first true statement you meet.
- Confusing the first attempt, by Naoroji, with the first official attempt under Mahalanobis.
- Crediting V.K.R.V. Rao with the first attempt rather than the first scientific one.
Naoroji is approached from several sides across shifts — his book is asked at 23 Sep 2024, 16:00, GA Q.6, and his drain-of-wealth idea at 25 Sep 2024, 12:30, GA Q.13. Learn the man and the four national-income milestones together and all these shapes fall out.
Related PYQs
No directly related past PYQ was found.