T.N. clocks good growth despite ‘shocks’

At 8.17%, the State’s growth rate is way ahead of the national figure of 6.81%

September 20, 2019 01:13 am | Updated 04:18 am IST - CHENNAI

Tamil Nadu, during 2018-19, recorded an economic growth rate of 8.17%, despite a deficit northeast monsoon and cyclone Gaja that devastated parts of the State.

What is noteworthy is that the State’s figure was well ahead of the national figure of growth rate of 6.81%

During the northeast monsoon (October-December), the State received about 33 cm rainfall against the normal of 44 cm, a deviation of - 24%.

Ordinarily, the monsoon accounts for about 50% of the State’s annual average rainfall. Though the cyclone, in November 2018, led to the uprooting of lakhs of coconut trees in the central districts of the State, it had left behind a debilitating impact on rural population of the region. What was a matter of comfort last year was sufficient availability of the Cauvery water in the Mettur dam, which reached the full level in July.

For the second year in succession, the primary sector did far better than the secondary and services sectors.

It was close to a double digit growth — 9.9%. Last year, the food grains production recorded by the State was 104.02 lakh tonnes, according to the Agriculture Department’s Policy Note for 2019-20.

The secondary and services sectors registered growth rates of 6.59% and 8.24% respectively.

Commenting on the State’s performance, N.R, Bhanumurthy, a professor at National Institute of Public Finance and Policy, New Delhi, says going by the growth rate since the year 2016-17, the State seems to be “immune absolutely to the macro shock that all-India economy is facing,” in the light of demonetisation in November 2016 and the implementation of the Goods and Services Tax in July 2017.

In the last couple of years, there were concerns about industry and the State government’s fiscal situation, apart from political uncertainty. Despite all these factors, the fact that the State has been doing well on the economic front suggests that its economy is resilient, he adds.

Farmers left out

AIADMK spokesperson Kovai Sathyan, who runs an IT firm in the U.S. and a retail chain, says the figures suggest that the matrix of Tamil Nadu’s economy is inching closer to achieving a perfect balance with each sector contributing its share of growth equally.

In many States, the mix is lopsided with one sector contributing much more than the others.

Lauding Chief Minister Edappadi K. Palaniswami for clearing a number of industrial projects, Mr. Sathyan is hopeful of the State doing well this year too despite the overall economic slowdown.

V. Sathyanarayanan, a leading farmer of Tiruvarur district, however, has a different take.

Though the primary sector’s figures look impressive as these figures reflect the value of production, agriculturists have not been benefitted by the development.

“We have not been given remunerative prices suitably. All what we want is the implementation of the Swaminathan Commission’s recommendation in letter and spirit that farmers be paid the Minimum Support Price (MSP), which should be at least 50% more than the weighted average cost of production,” the farmer adds.

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