Growth Experience of Indian Federation
By Dr.M.S.Kapadia<br>Economic Research India Ltd.
India, a huge country with
the size of almost Europe is bestowed with multitude of regions of great
diversity in size, factor endowments and levels of economic and social
The present study endeavours to examine the growth rates of the Indian
Federation in the context of 17 major States during 1990-91 to 1999-00. While
the relevant data are encapsulated in the table at the end of study, broad
observations on the dataset are given below.
average growth of the Indian economy during 1990s worked out to 5.77 per
cent. Out of the 17 major States, 8 States had recorded better than
all-India growth, while 9 States performed below all-India average.
West Bengal, Tamil Nadu, Gujarat and Maharashtra were among the top rankers
in terms of growth rates. Assam and Bihar were laggards during the decade in
terms of average growth rates.
- In individual years, the growth for the country
fluctuated from a trough of 1.3 per cent in 1991-92 to a high of 7.8 per
cent in 1996-97. The maximum variation in growth rates among the States was
in Gujarat. Here, the growth rate fluctuated from (-) 6.5 per cent in
1991-92 to 28 per cent in the following year. Incidentally, most of the
States had experienced steep dips in growth rates in 1991-92.
individual years, the maximum number of States doing better than the
all-India growth was in 1991-92, when the growth for the country was only
1.3 per cent. In this year, 10 out of 17 States performed better than the
all-India average. Karnataka, Punjab, West Bengal and Andhra Pradesh
recorded sharp improvement in their growth rates. On the other hand,
Gujarat, Madhya Pradesh and Rajasthan recorded declines in GDP during the
2 States did better than the all-India performance of 7.3 per cent in
1995-96, while 15 States recorded below all-India growth rate. These States
were Maharashtra (11.5 per cent) and West Bengal (7.4 per cent). This looks
queer, as these two States could not have by themselves boosted the GDP
growth for the country. Obviously, some States must have performed better
than what the relevant statistics reveal. Or, the overall growth of 7.3 per
cent for the country could be an overestimate.
for the preceding year 1994-95, for a similar growth experience of 7.3 per
cent for the country, 8 States had performed better than the all-India
average. Between 1994-95 and the subsequent year, only Maharashtra vastly
improved its growth rate from 2.6 per cent to 11.5 per cent. Bihar, Gujarat,
Rajasthan and Tamil Nadu reported sharp deterioration in growth rates
between these two years.
the States, Jammu & Kashmir was relatively the most consistent performer
with its growth rates ranging between 3.1 per cent in 1991-92 to 6.3 per
cent in 1999-00. The average growth for the State was 5 per cent.
To see : Annual Growth
Rates (%) of GDP by State:1990-91 to 1999-00 , Click