Even as the Indian economy is grappling to get over the worst, with the annual gross domestic product (GDP) growth below 5%, Himachal Pradesh - the small hill state has projected a sustainable growth rate of 6 to 7% in the coming year.
The gross state domestic product (GSDP) growth of Himachal is expected to remain at 6% for the current financial year- higher than the national growth.
In fact, Himachal has achieved higher growth rate than the national rate for financial years - 2011-12 and 2012-13. The state's growth rate in the two fiscals was 7.4% and 6.2%, respectively.
“According to advance estimate, the state is expected to achieve sustainable annual growth rate of 6% in the current financial year and it is likely to remain between 6-7% in the coming year,” said Pradeep Chauhan, state economic advisor, on the sidelines of five-day 13th Finance Commission review meeting and GSDP workshop that started here on Monday.
According to the survey conducted by the state economics and statistics department, the GSDP prices in 2012- 20-13 has increased to `72,076 crore from `63,812 crore in 2011-12 and is likely to go up in coming years.
The per capita income in the state has witnessed an increase of around 11%, going up from `74,694 in 2011-12 to `82,611 in 2012-13. The state is set to maintain impressive growth despite the fact its two main revenue generators - hydro-electric power sector and tourism - not performing well.
Chauhan added that as the state's economy is shifting from primary to secondary, the manufacturing sector (registered and unregistered) is emerging as the major contributor to the annual growth of the hill state. The manufacturing sector contributes 17.98% to the gross state domestic product. The secondary sectors are contributing 40.26% of GDP of the state.
For the purpose of estimation of the district income, the economy is divided into the three sectors - primary, secondary and tertiary - which are further divided into sub-sectors.
The primary sector includes commodity producing such as agriculture and allied services, forestry and logging, fishing and mining, while the secondary sector has manufacturing, construction and electricity, gas and water supply as its sub- sectors.
The tertiary sector constitutes transport, storage and communication, trade, hotels and restaurants, banking and insurance, real estate, public administration and other sub-sectors. The survey shows that the contribution of the primary sector in GSDP has come down to 19.15% in 2012-13 from 25.74% in 2004-2005.
Agriculture is the major contributor with 14.03% share in the state's growth in the primary sector. Power, which is included in the secondary sector, contributes 8.39% of the total GDP of the state.
Meanwhile, in his keynote address on the inaugural day of the workshop, additional director general, National Accounts Division, GOI, Ashish Kumar said, “There has been increasing demand for the estimates of the district domestic product below the state level, which is essential for assessing the level of development among the districts of the state.”
In his inaugural address, vice-chancellor, CSK-Himachal Pradesh Agriculture University, Dr KK Katoch said, “GDP is key indicator for allotting funds to the state from the union kitty. The expenditure on social sectors which include education to GDP is now the target values for consumption of developmental process.”
The workshop was jointly organised by the Himachal Pradesh economic and statistics department and the national accounts division.