State-wise estimates of financial savings of household sector—an exploratory study

Traditionally, domestic savings are not complied at state level by the Central Statistical Organization. Among the institutional sectors, estimates of saving of public sector are to some extent available at state level. But for the private corporate and household sectors, the saving estimates are compiled only at all-India level. Of these two sectors, household sector is the only surplus sector whose savings exceeds investment and the surplus resources are lent to deficit and needy sectors. In this paper, an attempt is made to estimate state-wise financial savings of the household sector. Like state domestic product, domestic savings is expected to vary widely across states depending on the overall economic activity of the region. Such estimates are helpful in studying the structural changes in state economies. As illustration, the methodology proposed in this paper is used for estimating state-wise financial savings of households for 2002–03, 2003–04 and 2004–05. The spatial and inter-temporal distribution of household savings presented in the paper provides important insights of the savings-investments nexus of the economy.