Kerala Economy Downfall

If we concerence about the Kerala economy the worst fears are coming true, The Gross State Domestic Product (GSDP) for 2013-14 shows that the growth rate of Kerala is slipping to 6.27 per cent, way below the projected growth rate of 8.6 per cent.

Worse, the GSDP for 2011-12 and 2012-13 were also much lower than the provisional numbers put out earlier. Kerala’s GSDP growth for 2011-12 and 2012-13, according to the numbers finalised by the Directorate of Economics & Statistics, stands at 5.85 per cent and 5.92 per cent, revised downwards from the provisional figures of 7.96 per cent and 8.24 per cent, respectively.

“The earlier GSDP rates were based on provisional figures provided by the respective sectors/departments. In the revised figures, we have corrected the numbers with the final numbers,” said an official at the Directorate of Economics & Statistics. “The final figures for 2014-15 is in the compilation stage, and it is likely that it would not show any major improvement,” the official reckoned.

Kerala’s faltering economic growth is in comparison with the scorching pace of growth recorded by some of its peers such as Madhya Pradesh, which clocked 11 per cent growth in 2013-14. Gujarat has been growing at an average rate of 8 per cent in the last 3 years. Among the other major states, Bihar, Tamil Nadu and Delhi are also showing higher growth rates than that of Kerala.

The falling growth is sure to impact the State’s borrowing capacity. The states’ annual borrowings are fixed at 3 per cent of their GSDPs.

But, there is good news on that front, after a revision of the way the GDP is calculated in India. The Central Statistics Office (CSO) revised the base year – on which comparisons are made – to 2011-12 from 2004-05, besides expanding its coverage of manufacturing. It also included the under-represented sectors and data from the corporate database of the government in arriving at the growth figure.

Src: http://www.newindianexpress.com/states/kerala/Keralas-Economy-on-a-Downward-Spi

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