MADE BY :

RITIKA TAYAL 0520005

VANSHIKA 0520053

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 INTRODUCTION
THIS PRESENTATION INCLUDES:
❏ REAL ESTATE ,OWNERSHIP OF
DWELLINGS AND BUSINESS
SERVICES
❏ GOVERNMENT FINAL
CONSUMPTION EXPENDITURE
REAL ESTATE, OWNERSHIP OF
DWELLINGS AND BUSINESS
SERVICES
The economic activities covered in this sector are:
❏ ownership of dwellings
❏ real estate services
❏ renting of machinery and equipment without operator
and of personal and household goods
❏ Computer and Related Activities,
❏ Accounting, Book-keeping and Related Activities,
❏ Research and development,market research and public opinion polling,
business & management consultancy,architectural, engineering & other
technical activities, advertising and business activities not elsewhere
classified
❏ legal services.
 METHODS OF GVA
ESTIMATION

★ The estimates of real estate, legal services and business services are
prepared using labour input and value added per worker approach.

★ The estimates of software development activities are prepared using

NASSCOM data of output .

★ For ownership of dwellings, the user cost approach is used.

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REAL ESTATE ESTIMATED AT
CURRENT PRICES
❏ This category includes buying, selling, etc.or leased real estate such as
apartment building and dwellings, non-residential buildings etc .

❏ Purchase, sale, letting and operating of real estate–residential and non-

residential buildings, Developing and subdividing real estate into lots, Lessors
of real property, Real estate activities with own or leased property n.e.c. Real
estate activities on a fee or contract basis are also part of this activity.

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❏ The GVA estimates for this activity are prepared
separately for corporate and unorganized
segments.
❏ The benchmark year’s GVA estimates are
prepared as a product of estimated labour input
engaged in the economic activity and the
estimated value added per worker ( VAPW )

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7
 OWNERSHIP OF DWELLINGS
In the production boundary of national accounts, only
two categories of services produced by households for
own final consumption are included, namely:
(a) Services of owner-occupied dwellings
(b) Domestic services produced by employing paid staff

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 Services of owner-occupied
dwellings:
❏ Owner-occupiers are deemed to own household
unincorporated enterprises that produce housing
services for their own consumption.
❏ The economic activities covered in this sector are
ownership of dwellings (occupied residential houses)
including imputed value of owner occupied dwellings
also.

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❏ In the old series (1999-2000), GVA estimates for the ownership of
dwellings were estimated as the gross rent of the residential houses
less the cost of repairs and maintenance.’.

❏ However, for the rural areas, the methodology for estimating value
added from rural dwellings has been changed to that based on user
cost approach .

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 BUSINESS
SERVICES
Renting of Machinery & Equipment without Operator
❏ The activities covered under this compilation category are the
activities of renting of machinery and equipment without operator and
of personal and household goods
For subsequent years, the estimates of workforce in the activity have been
prepared using the inter survey growth rate of Employment &
Unemployment surveys as observed
❏ The value added per worker of rural and urban areas and organized
and unorganized segments are projected to subsequent years with
the CPI (AL) and CPI (IW) respectively.
❏ The GVA estimates are compiled as product of workforce and VAPW
for the respective rural/urban/organized and unorganized segments.
Computer and Related Activities in
Private Sector
❏ The activities covered under this compilation category are
hardware consultancy, software consultancy & supply, data
processing,etc. The estimates of GVA for 2011-12 series of NAS
are compiled separately for organised and unorganised sectors.
❏ GVA estimates for organised sector are prepared using
NASSCOM data of output of software services and GVA to
output ratio.
❏ The constant price estimates for rural and urban segments are
prepared by deflating the current price estimates with the index
of CPI (AL) and CPI (IW) respectively.

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 LEGAL ACTIVITIES
❏ The activities covered in this category are legal activities (legal
services such as those rendered by advocates, barristers, solicitors,
pleaders, mukhtiars, etc.
❏ The estimates of GVA for legal services for the base year 2011-
2012 have been prepared by using the labour input method based
on VAPW estimates of NSS Enterprise Survey of 2019-20and the
labour input estimates based on EUS 2011-12 of NSS 68st Round,
worked out separately for rural/ urban and organized/un-organised
segments.

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Accounting, Book-keeping and
Related Activities in Private Sector

❏ The activities covered under this compilation category are

accounting, bookkeeping & auditing activities and tax
consultancy services.

❏ The estimates of GVA for legal services for the base year
2011-12 have been prepared by using the labour input method
worked out separately for rural/ urban and organized/un-
organised segments.

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Research and development, market research and public opinion polling,
business & management consultancy, architectural,engineering & other
technical activities, advertising and business activities

❏ This compilation category is obtained by regrouping the

activities under business services and other services.

❏ The estimates of GVA for this compilation category for the

base year 20011-12 have been prepared by using the
labour input method worked out separately for rural/ urban
and organized/un-organised segments

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 e
ESTIMATES AT CURRENT PRICE
s
❏ For Real estate activities, Renting of Machinery & Equipment
without Operator, Computer and Related Activities, the constant
price estimates for rural and urban areas are obtained by deflating
current price estimates with CPI (AL) and CPI (IW) respectively
except in the case of organised sector of real estate, business
services .
❏ The constant price estimates of urban dwellings are obtained by
moving the base year estimate with the intercensal growth rate in
dwellings.
 Quality and limitations of database
• The estimates of organized and unorganized segments are
prepared through benchmark-indicator method.

• The use of weighted RBI abridged results of sample companies

with compensation of employees and operating surplus as
weights will improve the quality of results.

• Regular, timely and complete data , could improve considerably

the quality of their GVA estimates.

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18
Growth in Real estate
30%

20%
17% 18% 18%
15% 15%
14% 13%
10% 11%
10% 9%
9%
5% 6%
2%
0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

-10%

-20% -21%
-24%

-30%

Nominal growth Linear (Nominal growth)

Real growth Linear (Real growth) 19
Growth in Ownership of dwellings

18%

16% 16%

14%
13%
12%

10%
10% 9%
9%
8%
7% 7% 7%
6%
5%
4% 5%
4%
3% 3%
2% 3% 3%
2%

0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Nominal growth Linear (Nominal growth) Real growth Linear (Real growth)
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Growth in Professional, scientific & technical
services
35%

30%
29%

25% 24%

21%
20% 20% 20%
19% 19% 19%
17%
15% 15%
14% 14%
12% 12%
10%

5%

1%
0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18
-2% 2018-19 2019-20

-5%

Nominal growth Linear (Nominal growth) Real growth Linear (Real growth)
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Growth in administrative & support services and
other professional services
30%

26%
25%

20% 21%
20%

17% 17%
15% 15%
13% 13%
12% 12% 12%
11%
10%
9%
8%
7%
6%
5%

0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

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Nominal growth Linear (Nominal growth) Real growth Linear (Real growth)
Growth in Real estate, ownership of dwellings
& other professional services
60%

50%
46%
40% 39%

30%
27%
25% 24% 24%
20% 21%
19% 18%
13% 12%
10% 11% 10% 9%

0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

-10%

-20% -19%
-23%

-30%

Nominal growth Linear (Nominal growth) Real growth Linear (Real growth) 23
Growth in Information and computer related
services
25%
23%
20%
17% 18%
16% 17%
15% 15% 15%
14%
12% 12% 12%
10% 10%
9%
8%

5%

0%
2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
-3%
-5%

-8%
-10%

Nominal growth Linear (Nominal growth)

Real growth Linear (Real growth)

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% Of Gross Value added to Value of Output -Current prices

110%

100% 96% 96% 96% 97% 97% 97% 97% 97% 97%

90%

80%

70%
63% 63% 63% 63% 63% 63%
61% 60% 61%
60%
57%
55% 54%
50% 49% 50%
47%
43% 43%
40% 40%

30%

20%

10%

0%
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Real Estate Ownership of dwellings

Professional, scientific & technical services including R & D
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% Of Gross Value added to Value of Output -Current prices

90%

80% 77% 78%

76% 76% 76%
74% 73% 72% 71%
70% 72% 73% 72%
70% 70% 71% 70% 70% 71%
67% 67%
60% 64% 65% 64%
56% 54% 55%
50% 54%

40%

30%

20%

10%

0%
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Information and computer related services

Administrative & support service activities and other professional services
Real estate, ownership of dwellings & other professional services
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 % Of Gross Value added to Value of Output-Constant prices
110%

100% 96% 96% 96% 96% 96% 96% 96% 96% 96%

90%

80%

70%
63% 63% 63% 63% 63% 63% 61% 61%
61%
60% 56%
53% 53%
48% 49%
50% 47%
43% 43%
40%
40%

30%

20%

10%

0%
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Real Estate Ownership of dwellings

Professional, scientific & technical services including R & D

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% Of Gross Value added to Value of Output-Constant prices
250%

77% 75%
76% 76% 75%
74% 72%
200% 71% 70%

150% 66% 66%

64% 65% 63%
56% 54% 54% 53%

100%

70% 70% 72% 71% 70% 70% 73% 72% 71%

50%

0%
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Information and computer related services

Administrative & support service activities and other professional services
Real estate, ownership of dwellings & other professional services
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Sectoral Contribution to Total Value of Output- Current Prices
120%

100%

21% 22% 26% 25% 26%

28% 27% 29% 26%
80%
3% 3%
3% 3% 3% 3% 3%
3% 3%
25% 25%
60% 25% 26% 28% 31% 31%
29% 33%

40%
42% 41% 38% 35% 33% 31% 35% 33% 31%
20%

9% 9% 8% 8% 8% 8% 7% 7% 7%
0%
2011-12 2012-13 2013-14 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20

Real estate Ownership of dwellings

Information and computer related services Professional, scientific & technical services including R & D
Administrative & support service activities and other professional services
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Sectoral Contribution to Total Value of Output- Constant Prices
120%

100%

21% 22% 25%

26% 28% 28% 30% 27% 27%
80%
3% 3%
3% 3% 3% 3% 3%
3% 3%
25% 26%
60% 25%
26% 30% 33%
31% 34% 35%

40%

42% 41% 38% 34% 31% 28% 32%

20% 29% 28%
Real estate
Ownership of dwellings
9% 9% 8%and computer8% 8% 8% 7% 7% 7%
Information related services
0%
2011-12 2012-13 Professional,
2013-14scientific2014-15 2015-16
& technical services 2016-17
including R &D 2017-18 2018-19 2019-20
Administrative & support service activities and other professional services

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GOVERNMENT FINAL
CONSUMPTION
EXPENDITURE
❏ The objectives of Government activities are determined
largely by the overall policies of the government, differ
widely in their cost structures and sources of finance.

❏ Hence studying the behaviour of macro-economic

parameters assumes great significance in the evaluation of
these programmes.

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❏ Producers of government services, that is, the administrative
departments of the government include autonomous bodies and
ministries/departments of central, state, union territory
governments and urban and rural local authorities engaged in
administration, defence and regulation of public order;
❏ health, educational, cultural, recreational and other social and
welfare services;
❏ promotion of economic growth and technological development. The
legislature, executive, judiciary and other bodies like public
services commission, general research and survey organizations
are also included under administrative departments.
 Estimates at Current Prices
❏ As govt is the financier of all these activities it is only
considered as the final consumer of all the goods and
services produced.
❏ The receipts are adjusted against the expenditure on
purchase of goods and services and only the net purchase
of commodities and services is considered for estimating
the final consumption expenditure.

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GFCE=
= Gross output of administrative departments
= total current expenditure of the administrative departments for producing
government services.

= compensation of employees (wages and salaries + pensions) + net purchase of

goods and services + consumption of fixed capital

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 Wages and
SALARIES
Wages and salaries

❏ Remuneration of general government

employees other than traveling and daily
allowances and contributions to provident fund
by the government, if any are included.
❏ Cost of liveries and uniforms, rations supplied to
police and defence personnel and provisions
are treated as part of compensation of
employees.
 Purchase of goods and services:

❏ All current expenditures are included, beside the

expenditure on current repairs and maintenance. Also
included are all payments/charges for services rendered
for other agencies/departments

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 Sources of data
❏ The main source of data for preparation of GFCE is the budget
documents of central and state governments and of local authorities.

❏ The statement titled “Annual Financial Statement” is the main budget

document.

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❏ Other important documents include Budget at a Glance, Finance Bill, Receipt
Budget, and Expenditure Budget, followed by detailed demands for grants for each
Ministry /department.

❏ The Annual Financial Statement, Receipts and Expenditure Budget and the
Demands for grants and the “Finance accounts” published by the Comptroller and
Auditor General of India are the main sources of data for preparation of the
economic accounts of administrative departments and departmental enterprises
and the estimates of GFCE of administrative departments.

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 ANALYSIS OF
DATA
❏ The current transactions of the departmental commercial undertakings
are at par with those of producers and of the purely administrative
departments with those of consumer.

❏ Current receipts of the producer constitute sale proceeds of goods and

services supplied to the rest of the economy.

❏ Administrative department have little or no income of their own and

largely draw upon the incomes of other sectors to meet their expenditure.
❏ The expenditure as well as receipts pertaining to the administrative
departments is segregated from those of the departmental commercial
undertakings and the economic accounts are prepared.
❏ The final consumption expenditures of ‘public services in autonomous
institutions (quasi government bodies), are also included in the GFCE
estimates.
❏ Besides preparing the GFCE estimates at National Level, an attempt can
also be made to compile the estimates at State level in respect of
autonomous bodies.

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Estimates at Constant Prices
● Estimates of government final consumption expenditure at
constant prices are prepared separately for compensation of
employees, net purchase of commodities and services and
consumption of fixed capital

● The constant price estimates of compensation of employees are

prepared by deflating the estimates of compensation of
employees at current prices by the Consumer Price Index of
industrial workers.

● Estimates of purchase of commodities and services net of

sales at constant prices are obtained by deflating current price
estimates by the corresponding weighted price indices of items
of expenditure.
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➔ The price indices of different commodities and services are combined to obtain
overall indices separately for Central and State Government Expenditure.

➔ For the items Traveling Allowance (TA) and other allowances, CPI Index for
Industrial Workers has been used.

➔ For items like Food, Beverages & Tobacco, Textile Products,

Wood and Wood Products etc., Wholesale Price Indices have been used

➔ Implicit indices have been used for groups like Electricity charges, Repair and
maintenance charges of capital goods, Railways, Communication and Banking
and insurance.

➔ A combined index has been prepared to deflate the current price estimates of
‘Net purchase of commodities & services’ by taking the weighted average of
the indices (of each of the group) separately for Centre and States. 42
❏ For the estimation of consumption expenditure of Local
Authorities the indices used for the State Governments
are used.
❏ The GDP for autonomous institutions at constant prices
is prepared by deflating its current prices series by
Consumer Price Index for Industrial Workers.
❏ The methodology as adopted for preparing the
estimates of GFCE in the case of autonomous
institutions at constant prices remains the same for
constant series.
❏ The constant price estimates of CFC are obtained by
following the procedure of Perpetual Inventory Model
(PIM),

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SUBMITTED TO:
MR. D BRAHMA REDDY SIR

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