How Gujarat defeating Tamil Nadu and Maharashtra in manufacturing?

How Gujarat defeated Maharashtra and Tamil Nadu
  • A number of Indian states have evolved directly from being agrarian economy to a service powerhouse without going t phase where manufacturing dominates, which resulted in scale creation of employment.
  • The state also scores better than Maharashtra and Tamil Nadu, which have been witnessing fall in share of industry. Gujarat now accounts for 11-11.5 per cent of the countries industrial output as compared to 8-8.5 per cent in 2001.
  • In Gujarat , however, the manufacturing accounts for the 40% of the Gross State Domestic Product (GSDP) as compared to 20% in India.
  • Gujarat has left behind the state of Maharashtra become the largest manufacturing hub in the country, as per data from RBI. Gujarat’s GVA (Gross Value Addition) in the manufacturing sector grew 15.9 percent yearly on average between Financial Year 2012 and Financial Year 2020 to reach Rs. 5.11 lakh crore, as per the RBI data.
  • Gross Value Addition is actually Gross Domestic Product minus net product taxes. This displays or shows growth in the supply of goods & services. The other states with the highest manufacturing Gross Value Addition included Karnataka at Rs 2.1 lakh crore, Tamil Nadu at 3.43 lakh crore, & Uttar Pradesh at Rs 1.87 lakh crore. The country’s manufacturing Gross Value Addition increased to Rs 16.9 lakh crore in Financial Year 2020 at an average growth rate of 9.7 percent since Financial Year 2012.

How Gujarat is dominating :

  • What played a significant role in allowing Gujarat to outpace the other states of India in manufacturing growth during the period likely was the Higher investment in the state. You can click here to know about new Vedanta-Foxconn multi-billion dollar semiconductor project in Gujarat.
  • The state of Gujarat witnessed the highest capital investment in terms of gross fixed capital formation which is a measure of investments between Financial Year 2012 and Financial Year 2019, which was at a total of Rs 5.85 lakh crore. This was ahead of the state of Maharashtra that saw an investment of Rs 4.07 lakh crore over the

Processed Diamond –

  • Gujrat is World’s largest producer of processed diamonds.
  • Furthermore, the state of Gujarat is the largest producer of processed diamonds in the world. It accounts for eighty percent of the country’s diamond exports and seventy-two percent of the world’s processed diamond share. Gujarat is not only the largest denim manufacturer in India but also the third largest manufacturer of denim, internationally. The state contributes sixty-five to seventy percent to the country’s denim manufacturing

Ports –

  • The state comprises forty-two ports, 18 domestic airports & one international airport. It also has a hundred and six product clusters and sixty notified special economic zones. As part of the USD 90 billion Delhi Mumbai industrial corridors, large-scale investment is anticipated in the state of Gujarat.
  • According to the Indian Ports Association data which was published in the month of June last year, the number of ports stood at forty-six and between the months of April and November, last year, 73.86 million tonnes of cargo traffic were handled by Deendayal port. Known as the country’s petrochemical & chemical hub, Gujarat possesses 8 clusters, fourteen industrial estates & 3 Special Economic Zones. These are mainly dedicated to the chemicals & petrochemicals industry.

Foreign Direct Investment –

  • The state of Gujarat received the highest Foreign Direct Investement at USD 21.89 billion in Financial Year 2021, as per the Department for Promotion of Industry and Internal Trade, and stood at the top of all states with thirty percent of the total equity inflows.

Exports –

  • Total exports from the state of Gujarat were accounted for USD 60587 million in 2020.
  • Key sectors of the state are as follows: Gujarat has over three thousand and three hundred pharmaceutical manufacturing plants that contributed thirty to thirty-five percent to the country’s pharma industry’s turnover and around twenty-eight percent to the country’s pharma export during 2018-2019.
  • While industrial growth of Gujarat has been thanks to “industry friendly policies, natural advantage of a long coastline and entrepreneurial nature of its people, the ent government’s initiative have enabled it to attract a diverse set of industries and industrialists.

Why Tamil Nadu is lagging behind?

  • Comparatively, poor infrastructure than Gujarat.
  • Industry Disputes
  • Power wooes
  • Administrative Clearance is not as simple as Gujarat.
  • Land Shortage
  • No Dedicated Freight Corridor

Sodhi Gautam

Sodhi Gautam

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