GLOSSARY

Accounting Period It is usually a year. But besides the calendar year, we have a fiscal year or a financial year, academic year, agriculture year, etc. Calendar year obviously runs from 1 January to 31 December. In our country, the fiscal year runs from 1 April of a calendar year to 31 March of the next calendar year while academic year runs from 1 July of a calendar year to 30 June of the next calendar year. Agriculture year is the same as the academic year. While calendar year is presented as 2001, fiscal and academic years are written as 2000-01. Our macro-economic aggregates refer to fiscal year while enrolments in schools refer to academic year. However, many businessmen use diwali to diwali as their business year. Age-specific Fertility Number of births given by women in a particular age group in any given year divided by the number of women in that age group, when multiplied by 1000, is called age specific fertility of that age group in that particular year. Basic Literacy Rate Percentage of literates among persons above 15 to the total size of population above 15 in a society is known as basic literacy rate. It is called basic because the minimum requirement of being literate is that the person should be able to read and write in any language. It is the same as adult literacy rate in our country. Birth Rate and Death Rate Birth is live parturition of a human baby from mothers womb. Stillbirths, miscarriages and abortions are not counted as (live) births. Birth rate is defined as number of live births per thousand of population in a given year. By convention birth of twins is counted as one birth. Death is final departure of a human being. Death rate is defined as number of deaths per thousand of population in a given year. Though twins are born together, they die apart. While their births are counted as one, their deaths are counted as two. Civic and Political Rights Political rights relate to a citizens rights of playing a part in determining as to who governs their public affairs and how they are governed. Civic rights concern the rights of the individual vis-a-vis the State. Cohort A group of people, who have a synchronous/simultaneous start by a significant event, is known as cohort. It is similar to a generation except that, in the case of a generation, the interval of happening of a particular event is not precise. In this case, an interval is fixed. Normally, it is a year. People born in a particular year, say 2001, constitute birth cohort of that year. There can be a marriage cohort or a recruitment cohort too. How the attrition in the group takes place is the basic interest in the analysis, using the concept of cohort. Combined Enrolment Ratio Enrolment ratio, for any given level of education, is obtained by dividing size of enrolment by size of population of corresponding (assumed) age group. For example, enrolment ratio for primary level of education in India, is obtained by dividing size of enrolment in primary classes by size of population of age group 6 -11. Enrolment ratios for primary, secondary and tertiary

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level of education are usually calculated. In combine enrolment ratio, we should divide the total studentship by size of the population of age group 6-23. Comprehensive Development Planning Planning which covers all spheres of development and encompasses whole of the economy is called comprehensive development planning. It does not restrict itself to public sector or to economic spheres alone. CSO and NAS The Central Statistical Organisation, set up in May1951 in the Cabinet Secretariat, but now a part of the Department of Statistics, is charged with coordinating the statistical activities in the country, laying down standards in terms of concepts, definitions and procedures, providing consultancy and advisory support to other statistical agencies and keeping liaison with international statistical agencies. With the transfer of work of estimation of national income in 1954 from the Ministry of Finance, it is also charged with the activity of preparing the national accounts, including macro-economic aggregates, accounts of the public sector, and consolidated accounts of the nation. The National Accounts Statistics is the annual publication of the CSO, giving details of different measures of different economic activities. Current Account Deficit Balance of payments accounts are a record of the international transactions of an economy. It has two parts: current account and capital account. The current account records trade in goods and services, as well as transfer payments. The capital accounts records purchases and sales of assets (like stocks, bonds, land, etc.) and bank deposits. Trade in goods means purchase and sale of goods, such as oil, scrape and jute and trade in services means payments like freight, royalty, and interest. Payments made or received on account of remittances, gifts and grants, known as transfer payments, are included in the current accounts. If, under the head of current account (trade in goods, trade in services and transfer payments), the total payments exceed the total receipts, there exists current account deficit. On the contrary, it is considered a surplus. Current Daily Status Employment/Unemployment Such an inquiry is made for each day of the week, the number of person-days employed/unemployed divided by seven is taken as average daily employment/ unemployment of the labour force. Dividing this number by the size of labour force (actually working or available for work) yields the current daily status. Demographic Investment Investment necessitated by births of children till they enter the labour force on education and health (including public health) is called demographic investment. This has public overtones and suggests investment on schools and teachers, and hospitals and doctors. It is understood that this is drain on development investment. Dependency Burden Expenditure on children while they are unproductive, on their bringing up, education and medicare is called dependency burden. This has parental overtones. Development Economics It is a distinctive branch of economics, which concerns with both the theory of development and policy for development with a view to improving the lot of poor people in developing countries.

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FERA and FEMA In order to regulate foreign controlled companies in India Foreign Exchange Regulation Act was enacted in 1947. When our foreign exchange resources fell below $1billion, the Act was amended in 1973 for conserving precious foreign exchange. But, it also had provisions to issue guidelines to the foreign investors to divert their funds, which employ sophisticated technology. As it led to some harassment, it was further amended in 1976. Finally, when we are somewhat comfortable with level of foreign exchange reserves, we have got FEMA (Foreign Exchange Management Act) which deals with issues of foreign exchange and foreign securities. Fiscal Deficit Total expenditure (revenue expenditure and capital expenditure including loan) revenue receipts plus other receipts (which do not create liability on the Government). Other receipts include sale of Government property, and shares and disinvestment proceeds. Flight of Capital When, on account of unsettled conditions of economic conditions, especially, if the Government is in financial difficulties, or in an extreme case, there is fear of serious depreciation of the currency, large numbers of those who have investments in that country will probably wish to transfer them elsewhere. If occurred on a large scale, it would be known as a flight of capital. The effect, of course, is only to increase the difficulties of the country from which the flight takes place. Foreign Investment Foreign investment is of two types. The first is investment of foreign capital into new productive activity. This is known as direct foreign investment. The other is foreign capital purchasing the shares of Indian companies. This is known as portfolio investment. Both of them give foreign exchange to the latter. While the foreign direct investment creates additional capacity and contributes to additional production, the latter does not. Both earn profit. It will depend on the nature of production, the foreign direct investor engages in, whether the product will be exported and earn foreign exchange for the country. Portfolio investor would have some claim over profit and some control over production. Forex Reserve Foreign exchange reserves consist of foreign currency assets, SDRs and gold reserves held by the RBI. They provide a cover for imports. They are however contributed by foreign investment, foreign aid, foreign borrowings and foreign grants, including those from IMF, and deposits by the NRIs all in hard currency. Green Revolution A quantum jump in productivity in agriculture sector achieved through a combination of scientifically developed hybrid seeds, fertilisers, herbicides and controlled irrigation, is called green revolution. While it raises the yield of a particular crop, it permits a number of crops to be grown annually on a particular plot. Gross Domestic Product It is a measure in monetary terms of the volume of all goods and services produced in an economy during a given period of time, usually a year, accounted without duplication. Since different units of production (tonnes, metres and litres) of goods and different measures of services (number of orthopaedic operations, number of stage shows and tonne-kilometres of transport) cannot be

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added, the measure of volume of all goods and services has, perforce, to be in value terms. We add up contribution of all activity of production, whether of goods or of services. While measuring contribution of a particular activity, we should subtract the value of inputs from the value of inputs, so that there is no duplication for parts of many goods and services enter as inputs into production of other activities. Prices in different periods for many goods and services are different. In order to measure the real change in total volume of all activities between two different periods, care should be exercised to use GDP at constant prices. [Suppose, all that an economy produces could be measured in kilograms (apples, wheat, eggs and pearls) should we add them up? If not, think why not?]. Gross Enrolment Ratio The ratio of number of students enrolled in a particular level of education, say primary level, to the size of population of children of relevant age group, say age group 6-11, is called gross enrolment ratio. The ratio is often expressed in terms of percentage. However, we know that many students enrolled in the primary section (Classes I-V) do not strictly come from the age group of 6-11. There are children below age 6 and also above age 11. Gross enrolment ratio may, therefore, turn out to be more than 100 per cent. Indeed in the case some states, it turned out to be as high as 150! If we exclude overage and underage children from the numerator, then the enrolment ratio should be called net enrolment ratio. Human Capital Formation As against physical capital, which is a machine, a building, a road, when human beings are made more productive through education and training and through better health and nutrition facilities, capital is formed in human form. It is believed that its contribution to productivity is enormous. Infant Mortality Rate Death before age one is called infant mortality. Infant mortality rate is the number of infant deaths in a particular year per 1000 live births during that year. Live births exclude stillbirths, miscarriages and induced abortion. In cases where infant deaths widely fluctuate from year to year, demographers take notice of the fact that infant death that occur in a particular year also include death of infants born in the preceding year and babies born this year may die next year as infants. In-migration and Out-migration A movement to a place with no immediate intention to return is called in-migration and a movement from a place with no immediate intention to return is called out-migration. When such a movement takes place between two countries, for the country receiving it is immigration and for country deporting it is emigration. Intellectual Property Rights Laws governing patents, copyrights, trade secrets, electronic media and other commodities, comprised primarily of information. These laws generally provide the original creator the right to control and be compensated for reproduction of the work. Laissez-faire A French phrase expressing leave us alone. It denotes the view that Government should interfere as little as possible in economic activity and leave decisions to the market. The role of Government, according to this view, should be limited to maintenance of law and order, national defence, provision of certain public goods like public health and sanitation, which private business would not undertake.

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Life Expectancy Life expectancy at age x is measured in terms of average number of years which are yet to be lived by the people at age x (at a given point of time). Life expectancy at birth is, therefore, the average number of years to be lived by the babies born in any given year. Life expectancy at age one is naturally the number of years expected to be lived by babies who have survived the first year of their existence. Live Birth The birth of a child who is alive at the time of parturition. Stillbirths, miscarriages and induced abortions are not counted as births because the children coming out of womb are already dead. Long-term/Short-term Objectives Long-term objectives are very much associated with our wishes for the kind of life people should lead. Short-term objectives may be the need of the hour. For example, there may be good reasons for having good amount of foreign exchange. But, accumulation of foreign exchange would not be our long-term objective. Containing inflation may be a short-term objective but lower income inequality is a long-term objective. Mean Years of Schooling Multiply a given number of years of schooling with the number of persons who had it. Add all such products. Divide the sum by the total number of persons. All persons with primary education may be taken as persons with five years of schooling. So multiply the number of persons (with primary education) by 5. Do the same for other levels. Million Tonne of Oil Equivalent Wood, coal, oil, gas and electricity are different forms of energy. Some forms can be substituted by other forms with ease, for example, wood by coal. Some forms can be converted into other forms, for example, coal, oil and gas can be converted into electricity. Use of various sources of energy depends on use and development of technology. Nevertheless, in order to form a basis for judging relative contribution of various forms, they have to be converted into some common unit. British Thermal Unit, Joule, and Calories are energy units. Since oil is now commonly used in many operations, the presently accepted way is to express energy content of every form in terms of its equivalence in oil form. Million is an internationally accepted unit for large numbers. MRTPA and MRTPC Following the recommendations of Monopoly Inquiry Committee (1965), an Act was passed in 1970. The Act was called Monopolies and Restricted Trade Practices Act (MRTPA). Under this Act, Monopolies and Restricted Trade Practices Commission (MRTPC) was set up to investigate, case by case, whether a given firm or a cartel of firms were resorting to such practices, obviously with a view to charging higher prices from the customers for their products. A company with paid up capital of Rs 20 crore was brought within its jurisdiction. In 1985, this limit was raised to Rs 100 crore. National Sample Survey Organisation (NSSO) It is a central government organisation is responsible for most of the large scale sample surveys carried out in the country. Using a scientific design, it collects sample data on regular intervals on various issues including consumption employment, unemployment, debt and investment. It collects data on variety of other subjects suggested to it. Natural Monopoly A monopoly, which emerges for technological reasons, not because of barriers to entry. Technology makes it cheaper for one producer to produce a product for or provide a service to whole of the market. In terms of

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resource cost, it is cheaper for the society too. If two plants try to meet the demand, with the same technology, for the same market, the resource cost will increase as they will not be exploiting the economies of scale. However, such firms need regulation, or else they would reap huge profits. Non-renewable Resources Resources that cannot be easily renewed. They have finite, even if large, stock. The stocks of fossil fuels (such as oil and coal) and mineral resources (such as iron, lead, aluminium, uranium) are the same today as they were millions of years ago. To convert CO2 and H2O back into fossil fuel will take as much energy as we got from it. Normalisation It is a modern term used for division by such factor as makes the numerator comparable. Sometimes, the numerator is also modified by subtracting something from it or subtracting it from something. See resemblance with normalisation and standardisation of a variable, which is considered normally distributed. NRI Non-resident Indian. An Indian who does not normally live and work in India but lives and works in some other country. He holds Indian citizenship and Indian passport. Occupational Classification of Employment As against where you are employed, which defines your industrial status, how you are employed defines your occupational status. Occupational classification is in terms of professional workers, administrative/managerial workers, clerks/stenographers, sales workers, service workers, farmers, fishermen, drivers, labourers, etc. Organised Sector All the public sector enterprises and those private enterprises registered legislation like Factories Act, companies Act and cooperatives Act are included in organised sector. Maintenance of accounts is the main criterion for the inclusion of enterprises in this sector. Passenger-kilometre/Tonne-kilometre A person (a tonne of goods) carried for one kilometre is one passenger-kilometre (tonne-kilometre). Percent Points The absolute difference between two percentages is known as per cent points. For example, the absolute difference between 50 per cent and 60 per cent is (60 per cent 50 per cent =) 10 per cent points whereas relative difference is [{(60 per cent-50 per cent)/50 per cent} 100=]20 per cent. Per Thousand Points Difference between two levels of rates expressed in terms of per thousand is to be expressed as per thousand points. It is similar to per cent points. Since many rates in demography are expressed in terms of per thousand, it becomes important to remember it. Perpetual Resources Resources, which will always exist in relatively constant supply, no matter how and how much they are used. Solar energy is one such example. Perhaps, geothermal energy or wind energy could be other examples. Person-day A person working for a day works for a person-day. Two persons working half-day each will amount to working for a person-day. Multiplying the number of persons with the number of days they have been working and aggregating all such multiplication products will yield the total number of person-days worked.

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Perspective Plan Perspective plan is a long-term plan, which forms the backdrop of the medium-term plan. While the medium-term plan is usually formulated for four/five/six years (in our country for five years), the long-term perspective plan is usually for ten/fifteen/twenty years. Long-term perspective plan thinks in terms of long-term goals of sustained increase in capacity matching likely demands ten years later or basic problems of poverty, unemployment or illiteracy, which one cannot solve in a day, or alternative technological possibilities. Medium-term plans bother about harnessing present technology, making a dent on poverty, improving balance of payments, controlling inflation. There are short-term or annual plans, which take care of immediate needs. Plans help one in moving in the correct direction. If there is a reason for deviating from the path, one knows that one has to come back to the long-term path. Postal Services Postal services can be divided as basic postal services and other postal services. Basic postal services concern with sale of stamps and stationery, acceptance of registered and insured articles and parcels, value payable articles and parcels, money orders and postal orders. Other postal services include speed post, business post, media post (public and private corporate sectors advertisement on postal stationery), satellite post, express post, retail post (acceptance of telephone bills and electricity bills). Potential Resources Many of the resources we know today were not considered resources once upon a time. Either we did not have taste for marine food or the technology was not ripe for using petroleum or natural gas. Economic, cultural and technological conditions of a society may find use for existing matters or discover new matters for use. Waste water and earthworms are now considered resources. Public Utilities Public utilities are business enterprises, often allowed to run as monopolies supplying essential public services, such as electricity, railways, communication, gas pipelines, water supply, sewerage, sanitation and irrigation. They are granted power of eminent domain (licence) to lay down spatial network in public interest. Whether in public sector or in private sector, they are regulated for price, quantity and timely supply. Purchasing Power Parity Exchange Rate In order to get one US $, you need to give around Rs 50 at the market exchange rate. Let us take an example of simple packet of bread, which is an essential item. Suppose it is available for Rs 15 in India and for US $ 3 in the US, then in terms of bread one US $ is equivalent to Rs 5. So would be the case if we hire a residential flat of the same size and standard in two comparable cities. Most of the essential items are home-made where market exchange is found to underestimate the value in the so-called underdeveloped countries. When purchasing power equivalence is applied, GDP of India becomes four-times and that of China becomes five-times but that of Japans becomes 0.6 times only. At market exchange rates, Japans and Chinas per capita GDPs in 1994 are found to be US $4600 and US $ 520, respectively, but in terms of purchasing power parity equivalence, they are found to be PPP $ 2800 and PPP $ 2475, respectively! Quota Restriction on quantity of a commodity, which could be imported during a given period. Though it is adopted by many countries for conserving their scarce

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foreign exchange, it is considered a form of protection(ism) for domestic industries against foreign competition. Rate of Natural Increase/Growth Difference between birth rate and death rate is known as rate of natural increase or rate of natural growth. This is to contrast with (total) growth rate, which considers net migration in its reckoning as well. Registered Manufacturing Units Under the Factory Act, a manufacturing establishment, including activities of repair and maintenance, has to be registered if it has 10 or more employees and uses power or has 20 or more employees but does not use power. Registered Tonne Cubical content of 100 cubic feet is called registered tonne. Renewable Resources Resources that can get easily renewed through natural processes once they are used. Forests, animals and fishes, if not overexploited, get easily renewed. Water is put in that category. Resources Objects, materials and commodities that are of use to the human society are reckoned as resources. The relative importance of resources may change over time because of changes in technology or tastes. Wood may be replaced by coal, and coal by oil or electricity as resource for energy. Waste products of some processes may be resource for other processes. The resources may broadly be divided into the following four, not necessarily exclusive, categories. Revenue Deficit The excess of Governments revenue expenditure over revenue receipts constitutes revenue deficit of the Government. Revenue receipts include proceeds of taxes and other duties as also interest and dividends on investment made by the Government, fees and other receipts for services rendered by the Government. Revenue (recurring) expenditure is incurred on normal running of the Government departments and various services, interest charges on debt incurred by the Government, subsidies, etc. Normally, revenue expenditure is not supposed to result in creation of assets; but grants given to the States by the Union, treated as revenue expenditure, may result in creation of assets. Route and Track Kilometres Distance between any two points, whether covered with one track or two tracks or three/four tracks, is called route distance, measured in route kilometres. When all tracks are measured, double as two and triple as three, it is total track. However, there are a few extra lines in sidings and yards to carry out technical operations. When these extra lines are subtracted, we get the running track. Sample Registration System We have civil registration system (CRS) for record of births, deaths and marriages. These events are recorded by panchayat agencies, police agencies and revenue agencies in rural areas of different states and through municipal authorities in urban areas. Even though registration of birth and death is compulsory by law, many births and deaths go unregistered. As a result, vital statistics rates based on civil registration system cannot be trusted. The Office of the Registrar General of India started a special registration system on a sample basis, viz., sample registration system on an experimental basis in 1964-65, which became fully operational during 1969-70. Now most of the vital statistics is based on SRS.

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Subsidisation and Cross-Subsidisation When loss due to recovery being less than the cost that is made up by the general revenue of the Government, the help is known as subsidisation. When one product is overpriced to under-price some other product, the practice is known as cross-subsidisation. Tariff A tax or levy imposed on each unit of a commodity imported into the country. Tonne and Ton Tonne a metre unit of weight is metric Ton equivalent to 1000 Kgs. It is about 1.6' per cent shorter than Ton which is equal to 2240 pounds. One pound is about 453.6 grams. When figures are in thousands of millions, no great harm will be caused if Tonne and Ton are taken as equal. Total Fertility Rate Roughly speaking, average number of children that could be born to a group of women when exposed to all age specific fertilities. Usual Status Employment/Unemployment A person may be employed today and unemployed tomorrow. So he/she is taken as usually employed/unemployed depending whether he/she was employed/unemployed for a major part of the year of inquiry. The number of persons, who are usually employed/unemployed, gives the extent of employment in that year. Dividing this number by the sum of all those who were employed or seeking work yields the usual status unemployment rate. Vital Statistics Statistics related to birth and death. There are many ratios to describe the phenomena connected with birth and death. Infant mortality or child mortality is given special importance. Life expectancy is an important vital statistics. WTO The World Trade Organisation (WTO) came into being in 1995 purportedly to raising living standards through substantial reduction of tariffs and other barriers to trade and elimination of discriminatory treatment in international commerce. It is the successor to GATT. At Uruguay Round, after negotiation for seven long years, nations agreed to constitute WTO. The WTO has increased its sphere of operation by including trade in services, trade related intellectual property rights and trade related investment measures.