Economic Survey 2024-25: States Urged to Prioritize Business Reforms for Industrial Growth
Agartala, Jan 31, 2025, By Our Correspondent77
The Economic Survey 2024-25, presented in Parliament by Union Finance Minister Nirmala Sitharaman, emphasizes the urgent need for states to prioritize business reforms to enhance industrial and service sector growth. It highlights that a targeted approach to industrial policies can significantly impact economic buoyancy and overall development.
According to the Survey, industrial activity is highly concentrated in a few states, with Gujarat, Maharashtra, Karnataka, and Tamil Nadu collectively contributing approximately 43% of the total industrial Gross State Value Added (GSVA). In contrast, six states from the Northeast region (excluding Sikkim and Assam) contribute a mere 0.7% of the industrial GVA, underscoring the need for specialized industrial strategies tailored to unique geographies like the Northeast.
The report identifies clear patterns in the degree of industrialization across different states. Some states, such as Gujarat, Uttarakhand, and Himachal Pradesh, have successfully leveraged their industrial sectors to generate substantial income for their populations. However, industrial development remains uneven, with some states more capable than others in utilizing their industrial potential to improve economic outcomes.
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The Survey also examines inter-state variations in construction activity, a sector closely linked with infrastructure development, urbanization, and real estate trends. It notes that while Kerala is relatively less industrialized compared to other states, it stands out as a positive outlier in construction activity. Construction contributes nearly half of Kerala’s industrial GVA, highlighting the state's distinct economic structure.
Additionally, the Economic Survey evaluates the mining sector, which accounts for approximately 8% of the total industrial output. The report specifies that mining activities are highly concentrated, with Assam, Chhattisgarh, Gujarat, Maharashtra, and Odisha together contributing about 60% of the total mining GSVA across all states. This highlights the need for a more balanced distribution of mining-related economic benefits.
The Survey underscores that states should focus on making it easier for businesses to establish and expand their operations. By simplifying regulations and improving the business environment, states can accelerate economic growth, enhance industrial competitiveness, and achieve faster convergence in living standards and per capita incomes across the country.