Tepid industrial growth looms over Odisha's economic rebound

A lacklustre growth of 2.54 per cent in the industries sector in 2012-13 is set to take some sheen off the Odisha growth story in the fiscal.

Though Odisha's economy is expected to rebound sharply to log growth of 9.14 per cent in 2012-13, from a sluggish rate of 4.92 per cent in 2011-12 and posting the best ever growth since 2008-09, a subdued growth in industries sector will remain a worrying factor.

As per the latest Economic Survey of the state, share of industrial sector is poised to fall from 25.78 per cent to 24.22 per cent of the state's GSDP in 2012-13. Explaining the cause for decline, the survey states the industrial sector has been hit hard due to global economic slowdown, disruption and other mining activities factors. The share of the manufacturing sub-sector is expected to 63.4 per cent and that of mining and quarrying sub-sector at 24.3 per cent.
 

While manufacturing is targeted to grow at a modest 3.35 per cent, mining growth is projected to remain stagnant in 2012-13 at 0.02 per cent though faring better than the negative growth of 5.63 per cent witnessed in 2011-12.

The survey mirrors the steadily falling share of the mining sector to the state's GSDP. While the sector contributed seven per cent to the state's real GDSP in the 11th Plan (2007-12), its share fell to 6.4 per cent in 2011-12 and is anticipated to drop further to 5.9 per cent this fiscal.

The economy's buoyancy, will, however, be maintained by agriculture and services sectors registering growths of 16.11 per cent and 10.09 per cent respectively.

Agriculture sector had posted negative growth in 2011-12 due to natural shock of drought and sharp deficit in average rainfall and was largely responsible for pulling down the GSDP growth to 4.92 per cent in that year. But helped by a bumper crop production in the current year, it has bounced back and is set to contribute 17.49 per cent to the state economy, compared to 16.44 per cent in the previous fiscal.Similarly, the higher growth projections for the service sector is mainly on the back of robust growth in its sub-sectors- trade, hotels & restaurants (12.41 per cent), transport (12.47 per cent), communications (17.60 per cent) and banking & Insurance (18.57 per cent).

Odisha's per capita real NSDP (net state domestic product) for 2012-13 is estimated at Rs 25584 as against Rs 24134 in 2011-12. The per capita income of districts reveals wide disparities. While Jharsuguda reported the highest per capita income (for 2009-10) at Rs 44510, Nabarangpur was at the bottom with a figure of Rs 14107.