GSDP’s declining growth may challenge goal of making Uttar Pradesh a trillion-dollar economy
No estimates have been released for the first quarter of the current financial year (2020-21) to date, which would have helped ascertain the impact of Covid-19 on the state’s economyUpdated: Oct 16, 2020, 12:11 IST
Uttar Pradesh (UP) government’s revised estimates of Gross State Domestic Product (GSDP) growth rate have reinforced a slowdown in the state’s economy in the last financial year (2019-20).
The data poses a serious challenge for the state government in its bid to boost the state’s GSDP in the next five years, as it aims to reach a trillion dollar mark.
No estimates have been released for the first quarter of the current financial year (2020-21) to date, which would have helped ascertain the impact of the coronavirus disease (Covid-19) on the state’s economy.
The declining growth rate does not augur well for UP’s economy.
The Yogi Adityanath-led government has received eight bids for appointment of a consultant to chalk out a roadmap to boost the GSDP.
Also Read: How the Covid-19 pandemic has hit GDP growth
It has invited technical bids for presentation. A call on this matter is likely to be taken in the next few weeks.
As per the revised GSDP estimates for 2019-20 released on September 29, UP’s growth rate has come down from 6.6% in 2018-19 to 4.4% (on constant prices) in the last financial year.
On current prices, the decline is from 12.1% to 8.8%.
Advanced GSDP estimates for 2019-20 released in February had also indicated a decline in growth from 5.4% to 4.4%.
In absolute terms, the state’s GSDP has gone up from Rs 16.09 lakh crore in 2018-19 to Rs 17.51 lakh crore in 2019-20 (on current prices).
However, advance estimates had pegged the size of GSDP at Rs 17.94 lakh crore in 2019-20, which showed a decline in actual terms.
“The data showed that 2019-20 was not a good year for the state’s economic growth. This slowdown in the state’s economy has serious implications. First, the goal to boost UP’s GSDP to a trillion dollar economy appears more distant than ever before. The bid to double farmers’ income by 2022 will be tough to achieve following a low growth of 3.2% in agriculture and allied sectors. The manufacturing sector has also registered a decline of 3.5%. The slowdown has been compounded by an adverse impact of the Covid-19 pandemic on the economy. This poses serious challenges to the state government in its bid to revive the economy and boost growth,” said Yashvir Tyagi, a former professor of economics, Lucknow University (LU).
The GSDP estimates for 2020-21 will be keenly watched in the coming weeks because of the impact of Covid-19 on the state’s economy.
“The state government should have declared the data for the first quarter by now,” Tyagi added.