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There has been a phenomenal rise in the industrial activities of Gujarat which has brought prosperity to people. This reflects in their enhanced standard of living and improved lifestyle. In the fiscal year 2005-06, the state's per capita income stood at $833, higher than the national average of $627.2. Its manufacturing units account for the largest employment of manpower across industries. As on March 2005, employment in public sector establishments covered under the employment market information (EMI) scheme was 830,000, whereas in its the private sector it was 860,000 (as on March 2005). Out of the total 1.69 million people employed in the organised sector, 234,000 (13.82 per cent) were women. The public sector employed 17.30 per cent of women, while the private sector employed 10.45 per cent.
The tertiary sector in Gujarat contributes significantly or infact the most to the GSDP. The agriculture sector is indeed the backbone of Gujarat and also serves as a strong base for the states economy. Rapid growth in agro-technology and food production has helped immensely in boosting its manufacturing and services sector. Gujarat is India’s largest producer of castor, groundnut, cotton, banana and tobacco.
Source: Socio-Economic Review, 2003-04 Government of Gujarat Website
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Monthly Per Capita Consumer Expenditure (in US$)
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Rural Gujarat
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Urban Gujarat |
| Gujarat |
12.2 |
25.4 |
| India |
11 |
21 |
Source: National Council of Applied Economic Research (NCAER)
Composition of GSDP according to the level of Economic Activity
The growth of the service sector can be attributed to increase in the increasing industrial activity. The fast growing manufacturing sector is largely responsible for the development of Gujarat. The state has over 312,000 small and 2,200 medium enterprises and is thus increasingly recognised as the hub of manufacturing activities. Contributing over 30 per cent of total manufacturing and exports of Gujarat, the small and medium enterprise (SME) sector has been instrumental in shaping the manufacturing industry.
From the period between 2003-04 to 2004-05, there has been a sharp rise in the number of factories and and it has reached a growth rate of 6.31 percent. The number of factories increased from 12,795 in 2003-04 to 13,603 in 2004-05. The Net Value Added by the factory sector increased from $7.22 billion in 2003-04 to $ 9 billion in 2004-05, recording an increase of 24.77 per cent, which indicates the stae's industrial progress. The average daily employment in working factories also increased from 978,000 at the end of 2005 to 1.03 million a year later. The capital investment by the factory sector in Gujarat also increased from $21.45 billion in 2003-04 to $21.77 billion in 2004- 05, recording an increase of 1.54 per cent.
As per the provisional summary results of the Annual Survey of Industries (ASI: 2004-05), Gujarat ranks second in the country, in terms of state-wise percentage share in Net Value Added by Manufacture generated by the factory sector.
The share of Gujarat in the country’s industrial aggregate is as follows:
- 9.97% factories
- 9.56% employees
- 15.59% of value of output
- 13.86 Net Value Added
There has been a remarkable financial growth and Gujarat has seen revenue deficit decreasing from $935.37 million in 2004-05 to a revenue surplus of $417.74 million in 2006-07. The total outlay has tripled in the 11th Five Year Plan (2007-11), over the previous one.
The proposed outlay for the Eleventh Five Year Plan (2007-12) of the state has been fixed at $26.73 billion by the National Development Council. The state is targeting an annual GDP growth of 11.02 per cent agricultural growth of 5.5 per cent and industrial sector growth of 14 per cent during the plan period. The target of the state was set at 10.2 per cent growth rate for the Tenth Five Year Plan (2002-07) higher than the national growth rate of eight per cent. Gujarat’s economy has recorded an annual average growth rate of 10.4 per cent for the entire plan period (2002-2007). The state has set the highest growth target of 11.2 per cent ford the 11th Five Year Plan.
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