Economic survey- HP economy estimated to grow at 5.6 percent in 2019-20

Per Capita Income at current prices which as per first revised estimates for 2018-19 was ₹ 1,83,108 is likely to increase upto  ₹ 1,95,255 during 2019-2020 showing an increase of about 6.6 percent

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The Himachal Pradesh economy is estimated to grow at 5.6percent in 2019-20. This was stated by Chief Minister JaiRam Thakur in the budget session of the Vidhan Sabha. He disclosed that  as per advance estimate the rate of growth during 2019-2020 is likely to be about 5.6 percent  as the total GSDP at constant  prices is estimated at  ₹ 1,24,403 crore against  ₹ 1,17,851  crore in 2018-19. He said that the Per Capita Income at current prices which as per first revised estimates for 2018-19 was ₹ 1,83,108 is likely to increase upto  ₹ 1,95,255 during 2019-2020 showing an increase of about 6.6 percent.

He said that due to increase in horticulture production by 42.82 percent the overall Primary sector registered a growth of 9.3 percent which resulted an overall growth of 5.6 percent. Adding that the growth during 2019-2020 is mainly attributed to the Primary sector 9.3 percent and Community & Personal Services sector 7.7 percent. The Secondary sector showed a growth of 3.9 percent.

Highlights economic performance  2019-20

Agriculture and Allied Sectors

The share of agriculture and allied sectors in the Gross Value Added (GVA) of the State at current prices has declined from 15.35 per cent in 2014-15 to 12.73 per cent in 2019-20. Share of crops, Share of forestry & logging has also declined from 2014-15 to 2019-20, however share of livestock and share of fishing marginally increased.

Tourism

The contribution of the tourism sector to the State GDP is about 7 percent.

Power

The State of Himachal Pradesh has an estimated Hydro Potential of 27,436 MW out of which 24,000 MW has been assessed as harness able while the Government of Himachal Pradesh has decided to forgo balance potential in lieu of safe guarding the environment and to maintain ecological as well as protect various social concerns. A potential of about 10,596.27 MW has already been harnessed so far under various sectors.

Trends in Industrial Sector

Industrial sector performance in terms of its contribution in Gross State Value Added (GVA) has slightly decreased in 2018-19 over 2017-18. The contribution of Manufacturing Sector in Gross State Value Addition (GSVA) at Current Prices is increasing every year, as it has increased from 26.69 percent in the year 2014-15 to 29.79 percent in the year 2018-19.

Current Trends in Inflation

Headline Consumer Price Index-Combined (CPI-C) inflation was 2.5 per cent in 2019-20 as compared to 6.2 per cent in 2014-15. Wholesale Price Index (WPI) inflation has seen an increase between 2015-16 and 2018-19, it fell from 4.7 per cent in 2018-19 to 1.5 per cent during 2019-20.

Trends in Expenditure on Social Services

As per the Economic Survey, the expenditure on social services by the State Government increased from ₹ 7,973 crore in 2014-15 to ₹15,156 crore in 2019-20 (Budget Estimate). As a proportion of Gross State Domestic Product (GSDP), the expenditure on social services has registered an increase of 1.48 percentage points during the period 2014-15 to 2019-20 from 7.68 to 9.16 per cent. The expenditure on education, as percentage of GSDP increased from 4.12 per cent to 4.75 per cent between 2014-15 and 2019-20 (BE). Similarly, expenditure on health increased from 1.25 per cent to 1.66 percent during the same period as percentage of GSDP.

Fiscal Developments

According to the budget estimates for the year 2019-20 (BE) the total revenue receipts are estimated at ₹ 33,747 crore as against ₹ 31,189 crore in 2018-19(RE) showing an  increase of 8.20 percent.

The State’s own taxes increased to 15.69 percent in 2019-20 (BE) which is estimated at ₹ 7,921 crore as against ₹ 6,847 crore in 2018-19 (RE) and   ₹ 7,108 crore in 2017-18(A). The State’s non-tax revenue (comprising mainly of interest receipts, power receipts, road transport receipts and other administrative service etc.) are estimated at ₹ 2,443 crore in 2019-20(BE), which is 7.24 percent of total revenue receipts of 2019-20.According to Budget Estimates of 2019-20, the tax revenue (including central taxes) is estimated at ₹ 15,319 crore as against ₹12,277 crore in 2018-19 (RE) which are 24.78 percent more than the revised estimates of 2018-19, which stands at 9.26 percent of GSDP. As per the budget estimates the Revenue receipts of the Government for the year    2019-20 are estimated to be 20.39 percent of the GSDP which were 20.27 percent in 2018-19 revised estimates. Similarly, the tax revenue for the year 2019-20 is estimated at 9.26 percent of GSDP as compared to 7.98 percent during 2018-19. Non-tax revenue is 1.48 percent of the GSDP in 2019-20 as compared to 1.51 percent during 2018-19, showing a marginal decrease. Revenue expenditure is likely to increase in 2019-20 whereas the Capital expenditure is likely to decrease as percentage of the GSDP in 2019.-20.

Fiscal deficit is estimated at 4.44 percent of the GSDP in 2019-20 as compared to 5.06 percent in 2018-19. Revenue and Primary deficit as percent to GSDP is expected to decrease in 2019-20.

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