Estimates of Noncorporate Private Saving in Pakistan: 1949-1962

This paper presents some partial and preliminary estimates of saving of the noncorporate private sector of the Pakistan economy. It is a part of a joint effort to make some more detailed estimates of saving for the entire economy, in which the Institute of Development Economics has been cooperating. It is hoped that more complete estimates for the whole economy will be available in the near future, but due to the importance of saving in the economic develop¬ment policy and planning, we feel it is worthwhile to present the data and analysis for this sector. There are estimates of saving in Pakistan for the period 1955/56 to the present, but these have been calculated in a very indirect manner, and they present no breakdown as to the sources of saving by sector. The procedure followed in the Planning-Commission estimates in the Mid-Plan Review1 was to estimate gross investment and to deduct from gross investment all “deve¬lopment imports” financed from abroad. As has been pointed out by John H. Power in his evaluation of the Mid-Plan Review, this method of estimating domestic saving is incorrect2, and he has presented some adjusted figures for the first two years of the Second Plan. The Planning-Commission estimation pro¬cedure, even if the proper definitions are used, is likely to result in serious errors in the volume of gross saving, and it does not give any information on the sources of domestic saving.