For Odisha, this comes as a big shocker as the State is now at the bottom of the BIMARU (Bihar, Jharkhand, Madhya Pradesh, Chhattisgarh, Rajasthan and Uttar Pradesh) States in the vital barometer of annual average economic growth in the 12th Plan.
The fourth year (2015-16) of the current Plan (2012-17) holds little promise with the estimated annual GSDP growth falling to 6.16 per cent. Unless, State’s economy performs with a wonder pace in 2016-17 (final year of 12th Plan), Odisha, else then, could well go down with tag of poorest economic growth among BIMARU club during whole of 12thPlan.
According to the latest data released by the Central Statistical Organisation (CSO), with change in the base year to 2011-12 from 2004-05 and change in GSDP estimation via Gross Value Added (GVA) from earlier methodology of growth at ‘Factor Cost’, Odisha finished at the bottom among BIMARU States in annual GSDP growth rate for the first three years of 12th Plan (2012-15). During the period, Odisha with an average annual growth rate of 4.8 per cent was even below Bihar, UP and Rajasthan. Uttar Pradesh’s economy recorded an average annual growth rate of over 5.9 per cent during 2012-15.
Odisha’s year-on-year GSDP growth for four consecutive years (2012-13 to 2015-16) was 3.52 per cent, 4.72 per cent, 6.24 per cent and 6.14 per cent, respectively. While Odisha’s annual GSDP growth rate failed to double during 2012-15, Bihar worked wonders to post an increase in annual rate of growth by as high as 5-times to over 15 per cent in 2014-15 from mere 3.5 per cent in 2012-13.
Odisha’s two neighbouring States — Chhattisgarh and Jharkhand - recorded a higher economic growth rate despite global economic slowdown. When Odisha could record mere 6.16 per cent growth in GSDP in 2015-16, Chhattisgarh posted higher growth rate at around 7.07 per cent. During the period 2012-16, Chhattisgarh posted an average annual growth rate of over 6.3 per cent against mere 5.16 per cent by Odisha. In the first 3-years of 12th Plan, Odisha grew by mere 4.8 per cent against a high of over 8 per cent per year by Jharkhand.
Why Odisha’s growth rate falters post rebasingIJ The base year was changed to 2011-12 by the National Statistical Commission to assess the growing Gross Value Added (GVA) to national economy by new-age sectors like IT, infrastructure, e-commerce, mobile telephony — which were at a very nascent stage in 2004-05. The poor diversification and penetration of service sector in Odisha pulled the growth rate down comparatively. Moreover, slower growth in registered manufacturing sector during 11th Plan (2007-12) and first two years of 12th Plan cast a negative effect on overall year-on-year GSDP growth rate in Odisha. For instance, when registered manufacturing growth rate in 11th Plan had been over 10 per cent per year, Bihar recorded annually a high of around 19 per cent.