A year ago, Maharashtra, Tamil Nadu, Gujarat, Karnataka, and Uttar Pradesh were India’s top states in terms of GSDP. But in FY21, post the coronavirus pandemic, Uttar Pradesh overtook Tamil Nadu, Gujarat, and Karnataka to become the second-largest state in terms of GDP with a GSDP of 19.4 lakh crore rupees.
As per a research by SBI, states like Uttar Pradesh, West Bengal, Madhya Pradesh, and Rajasthan show expansion in FY21 while the states like Maharashtra and Tamil Nadu which had performed better in the last few decades, have registered a sharp decline in the GSDP. So, the coronavirus pandemic has actually reversed India’s growth trajectory with states like Uttar Pradesh and Madhya Pradesh growing with beast spirits, leaving the industrialised ones falling behind.
Previously, when the data regarding the economy of Uttar Pradesh overtaking that of Bihar came out, the ministers in the Yogi government highlighted the business-friendly environment provided by the government. “Our state has been making rapid strides in industry and economy under the able leadership of Chief Minister Yogi Adityanath, who has ensured an industry-friendly eco-system in the state as a result of which UP had achieved the second position among all states in ease of doing business in a short span,” said MSME and export promotion minister Sidharth Nath Singh.
In the last few years, the governments in the industrialised states seem to have become very complacent. Be it the closure of the Sterlite copper plant in Tamil Nadu or the shifting of Metro shed in Mumbai, the anti-industry and anti-development attitude of the governments in these states was evident.
On the other hand, the governments in the states like UP and MP are trying their best to attract businesses and new investment. Be it reimbursement of state GST or the immediate implementation of farm laws and labour laws, the states which were behind earlier are now leading from the front, and UP and MP are the best examples of this.
Moreover, the attitude of the respective state governments is reflected in their budgets also. On one hand, the states like UP and MP are exponentially increasing their capital expenditure while reducing the revenue expenditure to spur economic growth, while on the other, the states like Maharashtra and Tamil Nadu are promising sun and moon for free to voters.
The Tamil Nadu assembly election manifestos are the best example of this. Both parties promised freebies worth lakhs of crores to the people, but there was no focus on industry and infrastructure. From direct cash transfer to laptop and tablet, everything was promised by parties DMK and AIADMK, ignoring the cost to the exchequer for these welfare schemes.
Similarly, in Maharashtra, every minister is giving a target to his department to amass lakhs of crores from businesses and industrialists illegally to fill their own coffers, ignoring their plight amid coronavirus.
Therefore, the states like Tamil Nadu and Maharashtra are being left behind while Uttar Pradesh and Madhya Pradesh are growing at a rapid pace in terms of the GSDP. Coronavirus seems to have reversed India’s growth story as far as Gross State Domestic Product is concerned.