State Economies

Highlights of Tamil Nadu’s First Economic Survey – 2024-25

Leave a Comment / Public Policy, State Economies, Tamilnadu Economy /

Highlights of Tamil Nadu’s First Economic Survey – 2024-25 Highlights of Tamil Nadu’s First Economic Survey – 2024-25 Chandrasekaran Balakrishnan April 1, 2025 Public Policy, State Economies, Tamilnadu Economy The economy consists of several components, including both institutional and individual people. Studying the progress of those components individually and collectively helps the governments, economy, and society to make future policies. The study of sectoral and sub-sectoral progress is an important exercise for the government to plan for its resource allocation and the economy to identify the growth potentials to be harnessed by the people and the private sector. After the Independence, the Union Government introduced the Annual Economic Survey Report along with Budget announcements in the year 1950-51. Given the importance of the economic survey analysis and perspectives on global and domestic policies on sectoral areas, the then Union Government separated the Union Budget and Economic Survey Report in 1964, which is being followed. Since the major economic reforms of 1991, the States embarked on building their growth and development path by bringing out a detailed analysis of sectoral, regional, intra-state district-wise, and block-wise progress of development. Like the Union Economic Survey, many State Governments have also started publishing their own economic survey to present a review of the major developments of the economy and make policy suggestions for the future.  For many years, all the Southern States have been publishing their annual economic surveys while presenting the budgets. The State of Tamil Nadu, the sole exception for years, has joined the bandwagon by publishing its “First State Economic Survey 2024-25” on 13th March, 2025, a day before the Budget Announcement for the financial year 2025-26 on 14th March, 2025. The survey was prepared by the Tamil Nadu State Planning Commission, led by a team of experts. The Government of Tamil Nadu used to bring out the “Economic Appraisal” report published by the Department of Evaluation and Applied Research (DEAR), with time lags. These reports were a kind of review of progress with little attention for public policy perspectives. This analysis focuses on key highlights of the Tamil Nadu’s First Economic Survey 2024-25 in terms of its presentation, and analysis of key issues. The state has set an ambitious goal of achieving a $1 trillion economy by 2030. As a highly industrialized and urbanized economy with strong linkages of global value chains on key sectors, Tamil Nadu’s economy has demonstrated remarkable economic resilience, consistently achieving growth rates of 8% or more since 2021-22. The state is estimated to grow above 8% in 2024-25. Further, the State achieved an average growth rate of 6.37% as compared to the national average of 6.1% during the period from 2012-13 to 2023-24. In the last two years from 2022-23 to 2023-24, this growth trajectory accelerated and the state achieved an average growth rate of 8.18%. The state did not estimate the likely growth rate for the financial year 2025-26 stating the economic situation is “unstable”. In terms of Per Capita Income at current prices, Tamil Nadu has Rs.2.78 lakhs which is 1.6 times more than the national average of Rs.1.69 lakhs in 2022-23 and is 4th largest state in per capita income ranks. While, in real terms, Tamil Nadu ranked 7th among major states in 2022-23, with a per capita income of Rs.1.66 lakh. However, there are huge variations among the districts within the state of Tamil Nadu. The district-wise per capita income highlights major variations among districts in Tamil Nadu. Chengalpattu district has the highest per capita income at Rs 6.48 lakh in 2022-23, followed by Kancheepuram (Rs.6.47 lakh) and Chennai (Rs 5.19 lakh). Notably, in 8 out of the state’s 38 districts, the per capita income exceeds the state average of Rs.2.78 lakh. These top-performing districts surpass the per capita income levels of several major Indian states, including Telangana, Haryana, and Karnataka. At the same time, the districts of Villupuram and Tiruvarur has per capita income of Rs.1.48 lakh each which is lowest in the state. Also, 7 districts (Ramanathapuram, Thiruvarur, Myiladuthurai, Ariyalur, Perambalur, Kallakurichi and Villupuram) have per capita incomes below the national average. Rapid urbanization drives demand for infrastructure services such as transportation, housing, sanitation, and utilities but in each of these areas, Tamil Nadu lags and is unable to provide good quality of facilities and services. Let’s look at the sectoral growth of Tamil Nadu’s Economy as emphasized in the Economic Survey: Tamil Nadu’s agriculture heavily depends on monsoons. The sector contributes Rs.1.5 lakh crore (6% of GSVA) and ranks as the 5th largest sector. It employs 41.1% of the rural workforce. In 2021-22, the state had 92.3 lakh farmers cultivating 64.6 lakh hectares of land. Notably, 93.5% of these farmers (86.3 lakh) are small and marginal, collectively farming 62.7% of the total cultivated area, with an average landholding size of only 0.7 hectares. Tamil Nadu’s 62% of the total cropped area includes major food grains, like paddy, maize, jowar, bajra, ragi, and millets, while non-food crops such as oilseeds, sugarcane, and cotton account for the remaining 38%. Paddy continues to dominate the cropping pattern, with its share in the total cropped area increasing from 32.1% in 2019-20 to 34.4% in 2023-24. The state’s consumption of fertilizers increased by 1.03 lakh MT to 10.68 lakh MT in 2023-24 from 9.65 lakh MT in 2019-20. Power consumption in agriculture also increased by 4146 million units to 17,957 million units and from 13,811 million units during the same period. The state government has allocated Rs.7,216 crore for the subsidy on three phases of free power in 2024-25 which needs to be rationalized by undertaking institutional reforms to eliminate power thefts and losses. The rise in the productivity of key crops in Tamil Nadu has been largely driven by the extensive use of chemical fertilizers and groundwater. The state has a total of 268 cold storage units with a combined capacity of 19,856 metric tonnes which is still inadequate given the expansions. The state’s organic farming has nearly doubled, rising from

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Odisha Budget-2025-26- Aspirations for Samruddha

Leave a Comment / Economic Reforms, Public Policy, State Economies /

Odisha Budget-2025-26- Aspirations for Samruddha by 2036 Odisha Budget-2025-26- Aspirations for Samruddha by 2036 Chandrasekaran Balakrishnan March 18, 2025 Economic Reforms, Public Policy, State Economies Three decades of major economic reforms in India showcase the structural and institutional paradigm shifts, and thereby results witnessed higher growth, efficiency, competition, and making choices available across different sectors. As the country embarks on Viksit Bharath@2027, many pandits now turn to the regional economies of States to leverage their capacity by empowering institutional reforms towards the achievements of aspirations of people and empowering cities as focal points for new growth engines. It’s also high time for timely implementation of State level institutional and decentralisation reforms for the next level of higher growth in India. The Odisha Budget for 2025-26 is a case in point where the State aspires to become Samruddha or Viksit Odisha by 2036 which is in alignment with national goals. By 2036, Odisha aims to become a USD 500 Billion economy and a USD 1.5 Trillion economy by 2047. This is not an easy task in any yardstick because the State has quite low urbanisation and aims to increase it to 22% by 2030 from 19% at present. However, Case studies by experts highlighted that “process reforms in Odisha reduced the number of steps needed to access funds” by a programme implementing agencies at ground level and hence, the state has high optimism. During the last three years the Odisha economy grew by 7.2% GSDP in 2024-25, 9.6% GSDP in 2023-24, 6% GSDP in 2022-23, and achieved average growth of 7.6% GSDP.  The State has allocated 22.4% (6.1% GSDP) of the total budget outlay to capital expenditures which will boost the State economy. However, the State is still predominantly agriculture-driven and catching up fast in industries and services sector growth. In 2024-25, agriculture, manufacturing, and services sectors are estimated to contribute 28%, 35%, and 37% of Odisha’s economy, respectively (at current prices). The State’s fiscal parameters have been bolstered with an uptick in recent times with many institutional reforms. The fiscal deficit of the State is estimated at Rs 34,200 crore for 2025-26, 3.2% of GSDP which is higher than the revised estimate of 3.1% GSDP for 2024-25. In 2024-25, the revised fiscal deficit of the State is 3.1% of GSDP which is lower than the budgeted 3.5% of GSDP. Also, it is estimated that the State aims to achieve a revenue surplus of Rs 31,800 crore, 3% of GSDP in 2025-26, as compared to a revenue surplus of 2.9% of GSDP in 2024-25 (RE). Odisha has abundant mineral resources, fertile agricultural land, and a 480 km-long coastline, with uniquely positioned to leverage its urban centres as growth engine development as a key driver. By population size, the state is comparable to countries like Argentina, Spain, and Uganda. What the State economies have to do is to find out the complementarity of central government support on top of governance and urban growth centres at a decentralised level of effective governance on the ground to make Samruddha Odisha realistic.  The State budget for 2025-26 has emphasised many emerging sectors as transformative and focusing on urban centres for the establishment of new industries both manufacturing and services sectors supported by state-of-the-art infrastructure facilities by empowering the Tier–II and Tier–III cities in the State. Besides, the State is also giving impetus to social infrastructure facilities including “Skilled in Odisha” a global brand name by “Skilling for the World”. The State is also empowering women as one of key drivers of development and inclusion in the process of growth. In 2025-26, the State has allocated 72% of the total expenditure for social sector development and 1% less than the previous year.   The State’s pragmatic steps to bring a future-ready industrial landscape are aimed at a comprehensive range of incentives being offered to Semiconductor, Compound Semiconductor units, and Display Fabs under the Semiconductor sector which makes Odisha the fourth state in the country to offer dedicated incentives to semiconductor units. The Budget announced that the State would collaborate with IIT, Madras for developing a comprehensive Odisha Maritime Perspective Plan to develop new ports at Inchuri and Bahuda. Mahanadi Riverine Port for Ship repair and building. Further, Odisha is poised to become a leading producer of Green Hydrogen/Green Ammonia for the decarbonisation of industries and the heavy transport sector for which the State is collaborating with IIT Bhubaneswar to establish a Testing-cum-Research facility for Green Hydrogen. Odisha has announced several transformative infrastructure projects that will not only strengthen Odisha’s logistics network but also fuel industrial expansion, trade, and employment, enabling for realization of the Samruddha or Viksit Odisha by 2036. The major initiatives announced in the Odisha Budget includes: comprehensive plan seeks to transform Odisha’s urban landscape into five engines of growth, powered by innovation, sustainability, and inclusivity, a Comprehensive City Road Decongestion Plan for Bhubaneswar city on 322 hectares in first phase and 3600 hectares in second phase with focus on service industry, IT, and R&D, establish a metropolitan development region of about 7000 Sq Km encompassing Bhubaneswar, Khurda, Jatni, Cuttack, Paradip and Puri, 2 key tourism development projects at Hirakud and Satkosia, improvement of 3000 Km of Road and development of Berhampur-Jeypore 6 lane Green Field Expressway, a ring road would be built in Barbil, a Greenfield Airport at Paradip for enabling to commence direct flight services to ten new domestic and three new international destinations making significantly enhanced air connectivity, new railway projects worth Rs.73,000 crore, an industrial corridor connecting Paradip– Choudwar – Dhenkanal – Angul -Sambalpur – Jharsuguda – Sundergarh –Rourkela region for seamless multi-modal transport services and develop Gopalpur and Paradeep as Blue Flag Beach. As highlighted in the State Budget “these projects mark a significant step toward building a future-ready Odisha, ensuring seamless mobility, robust infrastructure, and sustainable urban growth”. Also, the vision of Samruddha Odisha by 2036 is achievable provided it is imperative that the State needs to ensure the efforts to maintain financial stability at the State

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The Kumbhanomics 2025

Leave a Comment / Cultural Economics, Indian Economy, State Economies /

The Kumbhanomics 2025 The Kumbhanomics 2025 Dr S Narayanan March 6, 2025 Cultural Economics, latest, State Economies Economic Pulse of the World’s Largest Gathering For India, a nation with one of the oldest civilizations, the Kumbh Mela is more than just a religious festival—it is a cultural, social, and economic spectacle that has endured for millennia. Held at the Triveni Sangam in Prayagraj, Uttar Pradesh, this grand event exemplifies the deep connection between culture and economic activity. It happened during a certain celestial alignment of the Sun, Moon, Jupiter and Saturn – a rare event occurring once every 144 years. The Maha Kumbh Mela 2025, spanning 45 days from January 13 to February 26, is estimated to have drawn a humungous 66.30 crore pilgrims across India and around the world, making it one of the largest religious congregations. It is also estimated that nearly 47% of India’s population of 140 crores visited this holy site. Prayagraj, also referred to as the “TIRTHRAJ”, has been a centre of spiritual and cultural significance for centuries. The Chinese Traveller Xuanzang, in 644 CE described Prayagraj as a region of immense natural beauty, prosperity and cultural depth attracting over 5 lakh people including the rulers and wealthy merchants. The over 2000 years old rituals of taking a holy dip in the Maha Kumbh Mela is believed to elevate spiritual thoughts. The confluence of Ganga, Yamuna and Saraswathi rivers at the Triveni Sangam adds to the sanctity of this unique location. Besides being a cultural and spiritual happening, the festival also creates immense economic activities for the region and the state, which is the crux of this piece. Mahakumbh Nagar: A Temporary City with World-Class Facilities To accommodate the massive influx of pilgrims, a temporary city with state-of-the-art facilities, Mahakumbh Nagar, was set up. Key infrastructure developments include: The renovation of 92 roads and beautification of 17 major roads, construction of 30 pontoons bridges using 3308 pontoons, erection of 800 plus multi-language signages (Hindi, English, and regional languages), Installation of 233 Water ATMs to provide pure drinking water 24/7, construction of 1.5 lakh mobile toilets, implementation of AI-powered crowd density monitoring system with over 350 experts at key locations, installation of 3000 plus CCTV cameras and drones, adoption of facial recognition technology, installation of water towers for fire safety, Employment of underwater drones capable of diving up to 100 meters to provide round the clock surveillance, usage of a dedicated app for real-time updates on crowd density, employment of 56 cyber warriors, availability of state-of-the-art Multi Disaster Response Vehicle for safety and disaster readiness, construction of temporary hospitals equipped with surgical and diagnostic facilities, and setting up of 3 temporary sewage treatment plants for river protection etc. Logistics and Infrastructure Managing a crowd of this magnitude involves strategic planning for transportation, accommodation, basic amenities like water, sanitation, food, and healthcare. The Swachh Bharat Mission has played a crucial role in ensuring cleanliness. The government welcomed the domestic institutions / think tanks / policy makers to make the next time bigger and better. Many research institutions, including over 20 global institutions like Harvard, Standford, London School of Economics, Gates foundation, Kyoto University, AIIMS, IIM Ahmedabad, IIM Bangalore, IIT Kanpur, IIT Madras, JNU were invited to cover the event, right from planning to execution. The Union Ministry of Housing and Urban Affairs has tied up with institutions of international repute to study waste management through Harvard Business School – Food and Beverage Management, operations of the event, inter-city connectivity, Multimodal transport Hubs and public transport system.  Standford University – Solid Waste Management, efficiency and waste disposal.  IIM – Indore – Internationals related to behaviour change, sanitation.  IFC – Gates foundation – -economic impact in six districts.   The event highlighted India’s prowess in efficiently and innovatively organizing the world’s largest human gathering. The state government also achieved a Guinness World Record in Ganga Cleaning Drive and Mass Cleaning Initiative which set new benchmarks in mass sanitation and environmental efforts. Economic Impact &Technological Innovations The governments have always recognized the economic potential of the Kumbh Mela. In 2019, the state government spent around Rs.3,700 crore, attracting 25 crore visitors. This year, the allocation was doubled to Rs.7,500 crore. Advanced technologies such as artificial intelligence, robotics, and expert consultations have been employed to ensure smooth execution. The government’s investment of Rs.7,500 crore is expected to generate revenue of around Rs.3 lakh crore.  Key innovations include: Accommodation options ranged from Rs.2,000/- to Rs.2,00,000/- catering to diverse visitors, including the President, Prime Minister, ministers, VIPs, and international guests. The event has also boosted tourism in nearby religious sites such as Ayodhya and the Kashi Vishwanath Temple, further stimulating local economies. The Union Ministry of AYUSH provided quality healthcare services to over 2.5 devotees at the site of the event. Over 15,953 metric tonnes of waste were removed from the Mela area to keep it clean and plastic-free. It is estimated that the state witnessed a GST growth rate of 11% and 14% growth in the months of January and February, respectively, during Mahakumbh, generating over ₹1,000 crore increase in GST collections over the corresponding period last year. Further, the Chief Minister has stated in the Assembly that the Mela has rewarded the state economically too. He stated that a boatman family earned Rs 30 crore in 45 days with 130 boats, at Rs 23 lakh per boat & approximately Rs 52,000 a day. A definitive estimate may be expected when the official growth figures are published. Faith to Finance Projections suggest this surge in religious and spiritual tourism would have generated over Rs. 3.5 lakh crore in revenue (more than USD 360 Million), significantly uplifting the state’s economic landscape, benefiting everyone from small-scale vendors like cycle-borne tea sellers, bike-pool operators, boatmen, pilgrimage guides, casual laborers to local traders and corporate stakeholders. The beneficiary sectors include food and beverages, religious offerings (such as lamps, idols, Ganga water, and incense sticks), pilgrimage guides, travel packages, ayurvedic products, and promotional merchandise. This multifaceted

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