2017-18’s Economic Survey report tabled before Maharashtra legislative assembly before this year’s budget has declared that the state’s gross state domestic product (GSDP) has fallen to 7.3% compared to high growth rate of 10% that was recorded last year.
The report cited rapid fall in farm production due to bad rains as the main reason for overall fall in growth of India’s biggest state economy. Apart from that, even manufacturing and industrial outputs declined by large margins this year.
Bad monsoon season in 2017 provided only about 85% of normal rains to Maharashtra, which consequently resulted in total state agricultural output declining drastically. To counter this, the government had to further burden its economy by waiving off loans worth Rs. 36,000 crores taken by almost 90 lakh farmers.
Apart from that, the report also highlighted falling industrial growth rate from 6.9% in 2016-17 to 6.5% in this financial year. This proves that despite the government’s ambitious Make in Maharashtra scheme, factors like GST and demonetization have dented the state’s overall industrial growth.
State finance minister Sudhir Mungantiwar announced while presenting the annual budget that despite achieving slowest growth in the last three years, Maharashtra’s GDP rate of 7.3% is much higher than the national forecast of 6.5%.
He said Maharashtra, which aims to become a trillion-dollar economy by 2025, still performed better than most Indian states in other areas like per-capita income, literacy rate and growth in services sector.