The Hindu Business Line : Good monsoon, core sectors aid 7.5 per cent growth in AP

The Andhra Pradesh Governor, Mr Rameshwar Thakur, addressing the joint session of the State Assembly's Budget Session in Hyderabad on Tuesday. Beside him is the Speaker, Mr K. R. Suresh Reddy. — P.V. Sivakumar

Hyderabad , Feb.14

GOOD monsoon and improvements in the core sector performance have resulted in an upswing in the State economy as reflected in a 7.55 per cent growth rate in the Gross State Domestic Product (GSDP), up from 6.39 per cent last fiscal.

Addressing the Budget session of the Andhra Pradesh State Legislative Assembly here today, the Governor (in-charge), Mr Rameshwar Thakur, said there have been indicators that point towards buoyancy in the economy as reflected by credit expansion and increase in credit-deposit ratio of the scheduled commercial banks in the State that rose to 77 per cent by the end of September 2005.

The impressive expansion of the rural credit was the result of the sustained efforts and monitoring by the State Government. This credit expansion has directly helped the farmers and women self-help groups in the form of substantial increase in the flow of credit to these sectors, he said.

The State Government enacted the Fiscal Responsibility and Budget Management Act, 2005 with the objective of eliminating revenue deficit completely by 2008 and for containing the fiscal deficit to about 3.8 per cent of the GSDP.

During 2004-05, through prudent fiscal management measures, and despite giving free power to farmers, the State managed to achieve a reduction of Rs 1,000 crore in revenue deficit over the previous year. This is budgeted to be further brought down for the current year 2005-06.

The revenue deficit was 13.34 per cent of the revenue receipts and 44 per cent of the fiscal deficit for the period 1994-2004.

Referring to the strides the State power sector managed to achieve, the Governor said the T&D losses have come down by about two per cent and the implementation of High Voltage Distribution System (HVDS) will curb this further.

It is estimated that about 4,000 MW of capacity is likely to be added in the State in the next four years.

Mentioning about 50 years of State formation, the Governor said Andhra Pradesh has emerged as a knowledge hub. However, the annual growth rate was lower during the period 1994-2004, causing unprecedented agrarian crisis, calling for measures to set the process right through a series of measures including crop diversification.

Mentioning areas of horticulture, livestock, agriculture and other allied areas, the Governor said the State is seeking to bring a holistic development.

As a part of this drive, it has set up a Agricultural Technology Mission that fits well into the proposed Second Green Revolution.

On the industrial sector growth, the Governor said that many major projects such as expansion of Vizag Steel Plant, ONGC and HPCL refineries and creation of special economic zones would help improve the industrial climate. Since extremism has its roots in the social economic conditions in the backward areas, a Remote and Interior Areas Development Department has been created to address concerns such as land distribution, youth employment to wean away people from extremist activities.

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