A recent report on Uttar Pradesh’s economy released by State Planning Institute (Economic and Statistics Division) does not paint a rosy picture of the state and claims that the state’s economy has grown at less than 5 per cent of Gross State Domestic Product (GSDP) in the last four-and-a-half years of the Yogi Raj. The survey report does not augur well as Chief Minister Yogi Adityanath had earlier set the target of taking Uttar Pradesh to a one-trillion-dollar economy in the next five years. At present, the nominal GDP of the state for the year 2020-21 is Rs 17.05 lakh crore (US$ 240 billion).

There is no denying the fact that the COVID-19 pandemic has impacted the state’s economy as UP’s Gross State Domestic Product (GSDP) has shrunk by 5.9 per cent in 2020-2021. But the worrying sign is that the state’s economy grew at less than 5 per cent in the last four-and-half-year tenure of the Yogi Adityanath regime. The revised data released for 2018-19 (revised provisional), 2019-20 (revised quick) and 2020-21 (revised advance) also indicate that the economy of Uttar Pradesh grew at a lesser rate than expected.

The revised estimates of the state’s income that the State Planning Institute (Economics and Statistics Division) released last week show a systemic decline in the health of the economy. The GSDP growth in 2017-18 was 4.9 per cent. However in 2018-19 and 2019-20 fiscals, it remained at about 4.3 per cent only. As per these estimates, the rate of economic growth was less than 5 per cent during 2017-20 and -5.9 per cent in the COVID-19 affected 2020-21.

The advance estimates for 2020-21 (released in March 2021) indicated a contraction of about 6.4 per cent in the GSDP. The UP government can take solace because the national economy too contracted by 7.3 per cent in the 2020-21 fiscal, as per GDP statistics released by National Statistical Office (NSO) of the Union government on May 31, 2021.

The worrisome fact is that sectors like manufacturing registered negative rates of growth over the last four years and its share in GSDP is also declining and is less than 15 per cent. For a state which is yearning for industrialisation, this is not a good sign. On the contrary, the performance of the agriculture sector has been encouraging as even during the pandemic-affected 2020-21, the sector showed a positive growth of 2.7 per cent. Services, or tertiary, sector has done well except in 2020-21 wherein it shrunk to 7.9 per cent.

The data shows that UP’s GSDP (at current prices) is estimated to have reached Rs 15.82 lakh crore in 2018-19, Rs 17.25 lakh crore in 2019-20, and Rs 17.39 lakh crore in 2020-21. The state government had recently claimed that the GSDP had peaked from Rs 17.91 lakh crore to Rs 19.40 lakh crore (revised estimates) on March 31, 2021.

The above facts should be a sobering reminder to the state government that much needs to be done to put Uttar Pradesh on the fast trajectory of growth. If it really wants to become a one-trillion-dollar economy, the state has to come up with a clear roadmap. The poor GSDP does not enthuse confidence that the state will be able to achieve the target within the stipulated timeline and it would be better that the state government goes back to the drawing board and revises its strategy.