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Bihar tops the state GDP growth rankings for fiscal year 2017-18

Amit Agrahari by Amit Agrahari
22 January 2019
in Economy
BIHAR, GDP GROWTH

(PC: REDIFF)

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The state of Bihar has topped the gross state domestic product (GSDP) growth rankings among 17 largest states of the country. As per a report by rating agency CRISIL, titled ‘States of growth 2.0’, the GSDP of Bihar grew by 11.3 percent which is highest among 17 states of the non-special category. The study left out the state of Goa only from non-special category given the small size of the state. Bihar is followed by Andhra Pradesh and Gujarat which posted 11.2 percent and 11.1 percent growth respectively.   

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The states of Gujarat and Karnataka find a place among the top performing states in inflation and fiscal deficit while Punjab and Kerala are at the bottom in the table in terms of economic growth. The 12 out of 17 states in non-special category registered faster growth compared to previous year’s growth. This is contrary to the national trend which showed a decline in the GDP growth in comparison to the previous fiscal year. This contrary trend was reported due to the fact that large states like Maharashtra, Uttar Pradesh which comprise a large chunk of overall GDP of the country witnessed slower growth. The study ranked the state primarily on three major parameters i.e. GSDP growth, fiscal deficit and CPI Inflation. CRISIL used Central Statistical Office data to carry out the study.

The healthiest growth was registered in Gujarat where GSDP growth was good despite low inflation and low fiscal deficit. The states like Bihar increased their budgetary spending with the fiscal deficit reaching 7.2 percent to push growth. However, the increased public expenditure reaped the desired dividends for the state, unlike Kerala and Punjab. The state of Kerala was among the worst performers with 5 percent GSDP growth despite 6 percent inflation and 3.4 percent fiscal deficit. Punjab was ranked second from bottom with 6.2 percent growth, 3.7 percent inflation, and 4.5 percent fiscal deficit. The state led by senior Congress leader Captain Amarinder Singh could not achieve healthy economic growth despite increased public expenditure which took fiscal deficit to 4.5 percent of GDP. The GSDP growth in Kerala is worrisome as 5 percent growth is 1.2 percent lower than the second-worst performer, Punjab which registered 6.2 percent growth.

In the last one and a half decade, the state of Bihar has been led by JD(U)-BJP alliance for most of the time. Under Nitish Kumar’s leadership, the alliance government has performed well on almost every socio-economic indicators registering the double-digit GDP growth. Earlier, Bihar had become symbolic of corruption and ‘Gundaraj’ under the rule of Lalu Yadav. Nitish Kumar has successfully paddled Bihar on the path of growth freeing it out of the clutches of corrupt leadership.

Moreover, the public infrastructure of the state has improved significantly with almost every village being connected to the nearest markets through concrete roads. The law and order condition in the state is well under control with thousands of gangsters and criminals being put behind bars.

The healthy economic growth is necessary for states like Bihar where lakhs of people still live below the poverty line. This growth on the economic front will improve the standard of living in the state and bring it on par with other states of the country.

Tags: BiharCRISIL Reportgdp growthNitish Kumar
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