The basic difference between normal residents and non-residents of India is the days of residing in India. If a person is residing in India for more than 1 year, he would be considered a resident of India. In contrast, if he resides for less than a year, he would be a non-resident of India.
To know the difference between these two, we must clear the meaning of these terms:
Meaning of Normal Residents:-
Normal residents of a country include:
- Citizens and institutions normally residing in a country with economic interest.
- With this, Citizens of other nations who live in the country for more than 1 year with some economic interest.
- Citizens of the country working in international organizations or embassies in their own country.
- And, the citizens of a country living abroad for less than one year with an economic interest lies in the home country.
Meaning of Non Residents:-
Persons which are not treated as normal residents of a country are:
- Foreign visitors in the country for holidaying, medical treatment, studies, conferences, sports etc.
- Crew members of foreign vessels, commercial travellers and seasonal workers of the country.
- Foreigners who are employees of non-resident enterprises and visiting country to install machinery in these enterprises. These people will be considered non-residents as they visit the country for less than a year.
Chart of Difference between Residents and Non-residents of India :
| Basis of Difference | Residents of India |
Non-residents of India |
| Meaning |
Persons ordinarily residing in India with economic interest. |
Persons residing in India with no economic interest. |
| Residing Period | Here, residing period involves 1 year or more. | Here, it is less than 1 year. |
|
Economic interest |
A person residing has economic interest lies in India | The person residing doesn’t have any economic interest lies in India. |
|
Embassies workers |
Here, the Indians working in foreign embassies are included. | Here, the foreigners working in Indian embassies are included. |
|
International organisations |
Indian employed in international organisations located in India are included. | Foreigners employed in international organisations located in India are included. |
|
Ambassadors |
In this, the ambassadors for India in the rest of the world are considered. | On the other hand, ambassadors in India from the rest of the world are considered. |
|
Significance in National Income |
National income includes the income from normal residents of India. | National income doesn’t consider income from non-residents. |
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Conclusion:
Thus, there is a lot of difference between normal residents and non-residents of India. Hence, this difference must be cleared while estimating the national income.
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