Maharashtra – The Economic Power House – Growth Strategies

The article released on 18th Feb

FICCI Progressive Maharashtra – Annual Conference 2013

The state plays a major role in Economic development of the country and it will continue to have a major role to play going forward in future. The leading  Banks, Insurance companies, Mutual Funds, Automobile Companies,Public Sector Companies and Private Industry Groups have their head quarters in Maharastra. Apart from emerging as a leading Financial Centre, Maharastra also has seen very good growth in Manufacturing , Services and the Government has drawn up a plan to improve the productivity in Manufacturing, Services and Agriculture.

In the 11^th Five year plan, the State has achieved a growth rate of 8.6% against the national average of 7.9%. The growth target set for the 12^th five year plan is at 10.5%. The target growth rate for Agriculture is 4%, Industry is 11% and Services is 11%. The government is planning to spend Rs.2,75,000 cr , which is 70.8% higher than the outlay for the 11^th five year plan. The state is able to generate lot of resources and the budget deficit so far was within the manageable levels. Achieving a growth of 10.5% p.a will help the government to generate more resources and manage the finances well.

The increased focus on agriculture can result in 6% growth , higher than the projected growth rate , if more area could be brought under irrigation going forward. The government is taking efforts to provide non agriculture based employment opportunities to those who are in the rural areas which will help to increase their income in line with their counter parts in urban areas. This will increase the purchasing power and bring many out of the poverty line.

Maharastra’s urbanisation level is higher than the average for the country and development of Delhi Mumbai Corridor and approval for many new SEZ’s in the state will increase the urbanisation level further and create demand for Capital and industrial goods. Many new cities will be created.   Out of 386 SEZ’s in India, 88 are in Maharastra. There is a good scope exists for capitlalising the land bank available with the Government, State PSU’s and capitalising the land bank will generate more resources for development activities for the state.

The state attracted 4,630 projects, with a total investment of over Rs 6.5 lakh crore and employment potential of above 22 lakhs in 11^th Five year plan and this can witness a big increase in the 12^th Five year plan.

The state is well connected through all means of transport and there are initiatives to develop many new Airports and minor ports in the state which will increase the connectivity and free movement of people and goods . The PPP model of infrastructure development is a success in Maharastra and out of 888 projects in India, 88 are being implemented in Maharastra. The contribution of private sector is likely to increase going forward. Supported by investment friendly policies by the state and availability of power , a stretch target of 12% growth from Industry is possible. In the 11^th five year plan, Maharastra attracted the maximum FDI in India and this trend is likely to continue in the 12^th Five year plan.

Apart from Banking and Financial Services, the state has gained lot of prominence in development of IT and ITES sectors well supported by a good educational infrastructure in the State. The government has created a skill development corporation with a view to train 4.5 million people a year to be trained on various vocations. This will help to address the manpower needs of the industry and services. Training people on various vocations will also help to create many new entrepreneurs . The action plans identified by the State for the 12^th Five year plan supported by good implementation and good macro economic conditions, we can look forward to a stretch goal in growth of 11% in the coming plan period.