The State Income Unit is the main section of the Directorate and is entrusted with the job of preparation of State Domestic Product (SDP) estimates annually. SDP is a measure in monetary terms of the volume of all final goods and services produced by an economy during a given period of time accounted without duplication. SDP is a reflection of economic development of the State and its determinate Per Capita Income is a suitable measure of the well-being of its people.

The Directorate of Economics & Statistics, J&K has been compiling estimates of State Domestic Product regularly both at current and constant (2011-12) prices and making them up to date from time to time as per the guidelines recommended by the National Accounts Division (NAD), National Statistical Office (NSO), Ministry of Statistics & Programme Implementation (MoSPI), Government of India.

The SDP estimates are prepared with respect to a base year and this base year gets revised from time to time to take into account the structural changes which have been taking place in the economy and to depict a true picture of the economy through macro aggregates like GSDP, NSDP capital formation, etc. Currently the base year is 2011-12. The estimates of State Domestic Product are prepared for all the sectors of economy both in terms of Gross and Net basis. For the purpose of preparation of these estimates, the entire economy is divided into sectors & sub sectors in line with breakup of sectors followed at National and sub national level. Broadly these sectors may be divided into Primary sector, Secondary sector, Tertiary sector or Agriculture & allied sector, Industry sector and Service sector.

A uniform methodology devised by National Statistics Office, Ministry of Statistics & Programme Implementation is used to build up the estimates. At present, the estimates are developed at UT level only. The efforts, are however, afoot for development of Income estimates at district level also as they are assuming significance for variety of reasons. Estimates built ahead of scheduled date are called Advance estimates which subsequently turn as revised & provisional estimates with the refinements in the data from the concerned field agencies. The estimates become final only after these are discussed with the experts of National Accounts Division, NSO in the joint discussion held every year at Delhi.