Himachal's growth estimated to contract by 6.2%

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SME Times News Bureau | 05 Mar, 2021
Himachal Pradesh's economic growth is expected to contract by 6.2 per cent this fiscal as against 5.6 per cent in the previous one, while its per capita income is estimated to drop by 3.7 per cent to Rs 1,83,286 for 2020-21, Chief Minister Jai Ram Thakur informed the Assembly on Friday.

Tourism, which plays an important role in revenue generation and livelihood in the hill state, was the worst hit due to the Covid-induced lockdowns.

The Gross State Domestic Product at current prices is estimated to be Rs 162,816 crore in 2019-20 as against Rs 149,442 crore in 2018-19, showing the growth rate of 8.9 per cent during the year.

The per capita income in the state at current prices for 2019-20 is estimated to be Rs 190,407 against Rs 176,460 in 2018-19, a growth of 7.9 per cent as compared to 6.6 per cent in 2018-19, said the Economic Survey 2020-21 report that was tabled in the Assembly by Thakur, who also holds the finance portfolio, a day before the presentation of the state Budget.

He said owing to Covid-19 the per capita income at current prices is estimated to drop by 3.7 per cent to Rs 183,286 for 2020-21.

Himachal Pardesh's economy is highly dependent on hydroelectricity, horticulture and tourism.

Amid the pandemic, tourism saw a contraction of 81.33 per cent in foreign and domestic tourist arrivals in 2020.

Trade, hotel and restaurant sector showed a contraction of 9.2 per cent in this fiscal as against a growth of 4.6 per cent in 2019-20.

However, tourism did well in 2019 and witnessed a 4.63 per cent growth in both foreign and domestic tourist arrivals compared to 2018 where negative growth of 16.08 per cent had been witnessed.

He said state's economy suffered serious impacts on all sectors, ranging from acute to minor. The largest shocks were witnessed in transport, mining and quarrying, forestry, logging and construction.

Transport showed a negative growth of 28 per cent during 2020-21 against 5.6 per cent growth in 2018-19.

The manufacturing sector showed a contraction of 14.2 per cent in 2020-21 against a positive growth rate of 0.3 per cent in 2019-20.

The mining and quarrying sector showed a negative growth of 18.4 per cent in 2020-21 against 4.3 per cent growth in 2018-19.

As per the estimates for 2019-20 at constant (2011-12) prices, the Gross Value Added (GVA) of the secondary sector is estimated at Rs 53,498 crore against Rs 53,456 crore in 2018-19.

The agriculture and livestock sector registered a positive growth of 18.3 per cent in 2019-20 at constant (2011-12) prices with a GVA of Rs 10,583 crore as compared to Rs 8,949 crore for 2018-19.

However, during 2020-21 a contraction of 3.1 per cent has resulted due to a decrease of 43 per cent in horticulture production.

The share of agriculture and allied sectors, a key sector that supports 60 per cent of the population in GVA, at current prices has declined from 15.89 per cent in 2015-16 to 13.62 per cent in 2020-21.

The share of agriculture and allied sectors in the total GVA of the state has been declining on account of relatively higher growth performance of non-agricultural sectors due to structural changes taking place in the economy.