Prasoon S. Majumdar, Editor (Economic Affairs), B&E with Sray Agarwal of the IIPM Think Tank analyses how India’s so called most backward states are collectively set to take India to the next level
Interestingly, this growth has not been in isolation! It has also augmented the per-capita income of these states, indicatively bridging the national income parity to some extent. As per a study by ASSOCHAM ECO PULSE on “States Performance in Per Capita Income Growth” – Jharkhand’s per capita income grew to Rs.14,990 (16.6% growth), Orissa to Rs.14,795 (11.5% growth) and Chhattisgarh to Rs.16,365 (8.8% growth). What is even more interesting is the very fact that this growth momentum has also been instrumental in creating an enabling environment for investments, hence ensuring a greater impetus to growth in the foreseeable future as well. States like Bihar are already witnessing an upsurge in investment proposals in the steel, cement and power sectors. More so, Bihar is slated to become the cement hub of the nation and India’s fastest growing cement market in the times to come.
It is not just Bihar An in-depth analysis of state-wise investment also indicates that other similar states are also all set to take the big leap. For example, Orissa claimed Rs.3,25,285 crore capex investment, which is around 30% of the total investments announced in India during the last quarter of 2007-08. Big names like Vedanta Resources, Tata Steel, Mesco Steel and Bhushan Steel are all set to invest more than Rs.40,000 crore and install steel plants with aggregate capacity of 18.5 million tonnes in the state. Even Rajasthan cornered an impressive investment figure of Rs.11,102 crore for fiscal 2009, especially for energy and food processing projects.
Investments apart, the indications of the boisterous growth in these states, have also been observed by the rapid rise in sales of consumer goods. And if tele-density is any indicator for growing trade and commerce, then the slower states are getting tele-networked at a furious pace. As per the Telecom Regulatory Authority of India’s (TRAI) report on the Indian Telecom Services performance indicators published in September 2009, Gujarat’s tele-density (the number of phone connections for every 100 people) in urban areas is just 85.04 and overall tele-density is 50.52 while the national average urban tele-density is 102.79. Furthermore, Gujarat ranks eighth in the country in total tele-density. The urban tele-density in Rajasthan (104.4%) and Orissa (101.59%) match up to the national level of 102.79%. In Bihar and Jharkhand, tele-density were hovering around an impressive 99.41%. A comparative analysis also indicates that the total number of phone subscriptions in Orissa and Bihar had increased by 13.9% and 12.8% respectively on an average over the last five years. Contrast this with Gujarat that witnessed a growth of only 5.9%.
No doubt, the growth indicators of the conventional laggard states are looking promising like never before, which also ensures that India’s promise to deliver on the growth numbers would not be as skewed as it used to be earlier. There is also no doubt in the fact that India is on the verge of initiating a new growth story for itself, which is relatively even and balanced. However, the disparities are just not intra-region; there are stark disparities within the states as well. There is still a long for India to go, but at least it has made the right beginning. For now, let’s celebrate the new kids in the block…
Interestingly, this growth has not been in isolation! It has also augmented the per-capita income of these states, indicatively bridging the national income parity to some extent. As per a study by ASSOCHAM ECO PULSE on “States Performance in Per Capita Income Growth” – Jharkhand’s per capita income grew to Rs.14,990 (16.6% growth), Orissa to Rs.14,795 (11.5% growth) and Chhattisgarh to Rs.16,365 (8.8% growth). What is even more interesting is the very fact that this growth momentum has also been instrumental in creating an enabling environment for investments, hence ensuring a greater impetus to growth in the foreseeable future as well. States like Bihar are already witnessing an upsurge in investment proposals in the steel, cement and power sectors. More so, Bihar is slated to become the cement hub of the nation and India’s fastest growing cement market in the times to come.
It is not just Bihar An in-depth analysis of state-wise investment also indicates that other similar states are also all set to take the big leap. For example, Orissa claimed Rs.3,25,285 crore capex investment, which is around 30% of the total investments announced in India during the last quarter of 2007-08. Big names like Vedanta Resources, Tata Steel, Mesco Steel and Bhushan Steel are all set to invest more than Rs.40,000 crore and install steel plants with aggregate capacity of 18.5 million tonnes in the state. Even Rajasthan cornered an impressive investment figure of Rs.11,102 crore for fiscal 2009, especially for energy and food processing projects.
Investments apart, the indications of the boisterous growth in these states, have also been observed by the rapid rise in sales of consumer goods. And if tele-density is any indicator for growing trade and commerce, then the slower states are getting tele-networked at a furious pace. As per the Telecom Regulatory Authority of India’s (TRAI) report on the Indian Telecom Services performance indicators published in September 2009, Gujarat’s tele-density (the number of phone connections for every 100 people) in urban areas is just 85.04 and overall tele-density is 50.52 while the national average urban tele-density is 102.79. Furthermore, Gujarat ranks eighth in the country in total tele-density. The urban tele-density in Rajasthan (104.4%) and Orissa (101.59%) match up to the national level of 102.79%. In Bihar and Jharkhand, tele-density were hovering around an impressive 99.41%. A comparative analysis also indicates that the total number of phone subscriptions in Orissa and Bihar had increased by 13.9% and 12.8% respectively on an average over the last five years. Contrast this with Gujarat that witnessed a growth of only 5.9%.
No doubt, the growth indicators of the conventional laggard states are looking promising like never before, which also ensures that India’s promise to deliver on the growth numbers would not be as skewed as it used to be earlier. There is also no doubt in the fact that India is on the verge of initiating a new growth story for itself, which is relatively even and balanced. However, the disparities are just not intra-region; there are stark disparities within the states as well. There is still a long for India to go, but at least it has made the right beginning. For now, let’s celebrate the new kids in the block…
Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
Arindam Chaudhuri's Portfolio - he is at his candid best by Society Magazine
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
IIPM B-School Detail
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).
For More IIPM Info, Visit below mentioned IIPM articles.
Prof. Rajita Chaudhuri's Website
domain-b.com : IIPM ranked ahead of IIMs
Arindam Chaudhuri's Portfolio - he is at his candid best by Society Magazine
IIPM Best B School India
Management Guru Arindam Chaudhuri
Rajita Chaudhuri-The New Age Woman
IIPM's Management Consulting Arm-Planman Consulting
Professor Arindam Chaudhuri - A Man For The Society....
IIPM: Indian Institute of Planning and Management
IIPM makes business education truly global
IIPM B-School Detail
