Himachal Pradesh - Economy
The global macro economic landscape chartered a rough and uncertain terrain characterised by weak growth of world output. Indian’s growth story remained positive and registered a steady pace of economic growth in 2016-17. However, weak growth in advanced and emerging economies had taken its toll on India’s exports. The economy having grown 7.9 percent in 2015-16 is expected to decline to 7.1 percent in 2016-17.
In a short span of time of Himachal Pradesh has become a model of development not for smaller States but for the bigger States of the country in the field of Education, Health, Horticulture, Social Welfare and inclusive growth. Today Himachal is known as most prosperous and fastest growing economy in the country. The economy of the State is expected to achieve a growth rate 6.8 percent in the 2017 financial year. The Per Capita Income at current prices witnessed an increase of 9.1 percent as it increased to `1,35,621 in 2015-16 from `1,24,325 in 2014-15.
The poverty ratio estimates are for the year 1999–2000 show that nearly 36 percent of India’s population was below the poverty line. In comparison, Himachal Pradesh had 28.4 per cent of its population below the poverty line. This contrasts sharply with the incidence of poverty in Punjab, where this percentage was only 11.8, and even Haryana and Jammu & Kashmir, where these ratios were almost identical, had a lower incidence of poverty than Himachal Pradesh.
The economic growth in the State is predominantly governed by agriculture and its allied activities showed not much fluctuations during nineties as the growth rate remained more or less stable. The economy has shown a shift from agriculture sector to industries and services as the percentage contribution of agriculture and allied sectors in total State Domestic Product has declined from 57.9 percent in 1950-51 to 55.5 percent in 1967-68, 26.5 percent in 1990-91 and to 9.4 percent in 2015-16.
The declining share of agriculture sector do not, however, affect the importance of this sector in the state economy as the state economic growth still is being determined by the trend in agriculture and horticulture production. It is the major contributor to the total domestic product and has overall impact on other sectors via input linkages, employment and trade etc. Due to lack of irrigation facilities our agricultural production to a large extent still depends on timely rainfall and weather conditions. High priority has been accorded to this sector by the Govt.
The State made significant progress in the development of Horticulture. The topographical variations and altitudinal differences coupled with fertile, deep and well drained soils favour the cultivation of temperate to sub-tropical fruits. The region is also suitable for cultivation of ancillary horticultural produce like flowers, mushroom, honey and hops.
In view of the growing need of the State economy, the government embarked upon a program to provide uninterrupted continuous access to power supply in the state. Several steps have been taken for increasing power generation, strengthening of transmission and distribution. As a source of energy hydro power is economically viable, nonpolluting and is environmentally sustainable. In order to restructure the sector, the Power Policy of the State attempts to address all aspects like capacity addition energy security, access and availability, affordability, efficiency, environment and assured employment to people of Himachal.
Tourism is a major engine of economic growth, an important source of revenue earnings and a generator of employment of diverse kinds. The State Govt. has also developed appropriate infrastructure for its development which includes provision of public utility services, roads, communication network, airports, transport facilities, water supply and civic amenities etc. As a result of high profile media thrust, a significant rise has been noticed in the domestic as well as foreign tourist inflow during last few years.
