New Delhi: Jharkhand and Orissa are growing at a frenetic pace in terms of their per capita income, owing to a massive thrust that industrial activity has received in the two mineral rich states while Karnataka, Gujarat and Tamil Nadu have maintained leads among other states.
According to an Assocham Eco Pulse (AEP) study on ‘States performance in per capita income’ has highlighted that Jharkhand, with per capita income of Rs14,990, has registered 16.6% growth. With an abundant resource of mineral and other natural resources, the state has been receiving investment proposals in steel, cement and power sectors, giving necessary push to its economy, providing sufficient employment opportunities.
With influx of huge capex by the large industrial houses in the core infrastructure sector, Orissa is witnessing a rapid rise of 11.5% in income distribution (Rs14,795).
Per capita income reflects on the purchasing power and standard of living of the people of each state. For inclusive growth, it is necessary for the states to put in efforts to raise the income attributable to each person.
Buoyed by huge investment flow, rising employment opportunities, increasing foothold of service-based sectors, southern states of Karnataka and Tamil Nadu and industrialized Gujarat rank among the top states with per capita income more than the all-India average of Rs20,734 (in FY06).
Karnataka tops the chart of well-to-do states with fastest growing income per person by 9.28% at Rs21829 for the FY 2006. Gujarat’s average income per person rose to Rs26,543 with growth of 8.92%. Per capita income in Tamil Nadu was recorded at Rs24,308 with rise of 8.46%. Noticeably, these best performing states are among the 10 most populous Indian states with more than 54 million population each.
However, Delhi and Goa, relatively smaller states, have highest per capita income at Rs49172 and Rs47507 but the rate of growth is relatively lower at 6.9% and 6%.
The state of Chhattisgarh struggling at political, social and economic front, witnessed 8.8% growth, though average income base remains very low at Rs16,365.
Development plans in Madhya Pradesh, Uttar Pradesh and Bihar are yet to take off as they remain at the bottom of the pyramid with lowest per capita incomes of Rs12566, Rs10637 and Rs6610 growing at the slowest rates of 2.9%, 3.1% and 3.7% respectively.
Per capita income in 17 states was growing below the national average of 8.4% while per capita income for the Indian economy grew to Rs22,483 in FY07 from Rs20,734 in FY06.
Maharashtra, with the largest state domestic product and major recipient of foreign as well as domestic investment, has witnessed a healthy growth rate of 7.3% in its per capita income (29,085). Another state to record above 7% growth was Uttaranchal, though the income base was low at Rs20, 328 per person in fiscal 06.
Haryana, with prosperous farm sector and booming IT, real estates, engineering and construction activities, has the third largest per capita income of Rs 29,887 growing at 6.5%.
West Bengal, despite having the fourth largest population, has managed to raise its per capita income at a rate of 6%, owing to massive investment plans in sectors like steel, real estate, power, retail and IT. The average income per person was recorded at Rs 20,485 in the fiscal 2005-2006.
There were states where the effect of overall economic boom was not reflected in their per capita income. While the state domestic product of Kerela and Andhra Pradesh grew by 8.8% and 7% respectively, average income available to each person grew by 5.9% each.
Per capita income in scarcely populated Himachal Pradesh rose at a moderate growth rate of 5.34%. As the state remains predominantly dependent on tourism sector, the level of industrial investment remains low. Per capita income was recorded at Rs27,162 in fiscal 06.
Growth in the prosperous state of Punjab seems to have stalled as rise in per capita was estimated to be mere 2.9%, even though it has the fifth largest per capita income of Rs28,605.