Socio-economy of Indian

States

Bibek Debroy
Laveesh Bhandari
Indicus Analytics
This Presentation
„ INDIA TODAY
„ Rating and Ranking States
„ What is happening within the states
„ INDIA TOMORROW
„ Where are the states going towards?
„ Socio-economic progress
„ Economic growth
Classification of States
„ Large-Small States: Large states have
population of greater than 5 million and area
greater than 35000 sq km
„ Example: Arunachal area similar to West Bengal’s
area, population similar to Pondicherry’s population
„ Example: Delhi population similar to J&K’s
population, similar to Goa’s area
„ Delhi and Pondicherry considered states
„ Chief Ministers
„ Elected Assemblies
 States & UTs
Larger States Smaller UTs
1 Andhra 11 Kerala 1 Arunachal 1 A&N Islands
2 Assam 12 Madhya 2 Delhi 2 Chandigarh
3 Bihar 13 Maharashtra 3 Goa 3 D&N Haveli
4Chhattisgarh 14 Orissa 4 Manipur 4 Daman Diu
5 Gujarat 15 Punjab 5 Meghalaya 5 Lakshadweep
6 Haryana 16 Rajasthan 6 Mizoram
7 Himachal 17 TN 7 Nagaland
8J&K 18 UP 8 Pondicherry
9 Jharkhand 19 Uttaranchal 9 Sikkim
10 Karnataka 20 WB 10 Tripura
Categories
„ Agriculture: Cash crops, Productivity, Irrigation
„ Consumer Market: TV, 2-wheeler, Expenditure
„ Education: Literacy, primary school completion,
states’ expenditure
„ Health: IMR, doctors, tap water, gender bias
„ Law & Order: Police, pending cases, violence
„ Infrastructure: Electricity, roads, telephone, LPG
„ Investment Environment: disputes, SSI sickness,
commercial bank credit, public investment
„ Budget & Prosperity: Poverty, SGDP, State debt
Ranking of States
„ All states are different
„ They have to be made comparable
„ Larger States, Smaller States, UTs
„ Normalization
„ Ratios and percentages
„ Per capita
Infrastructure

„ Access to
Electricity
„ Road length
„ Bank branches
„ LPG
connections
„ Post offices
„ Telephone
density
Consumer
Markets

„ TV ownership
„ Rural
households
spending > Rs
615 per person
per month
„ Urban
households
spending > Rs
1120 per person
per month
„ Bank deposits
„ Two wheelers
Education

„ Literacy rate
„ 10 plus children
completed
primary
„ Girls to boys
enrolled in
elementary
school
„ Teacher student
ratio
„ Expenditure on
elementary
education
Law & Order,
Justice

„ Police strength
„ Pending to total
cases in courts
„ Incidence of
murder
„ Incidence of
kidnapping
„ Incidence of
rape &
molestations
Health

„ IMR
„ Male to female
IMR
„ Births assisted
„ Access to tap
water
„ Doctors
„ Sex ratio
„ Expenditure on
health and
family welfare
Investment
Attractiveness

„ Public
administration
GSDP
„ State’s capital
expenditure
„ Bank credit
„ Industrial
disputes
„ Gross capital
formation
„ Industrial
workers
„ Sick SSIs
Agriculture

„ Cash crops
„ Agriculture
GSDP
„ Electricity
consumption
„ Food grain yield
„ Loans to
agriculture
„ Irrigated to
sown area
Budget &
Prosperity
„ State’s capital
expenditure
„ Total debt
„ Sales revenue of
SEBs
„ Per capita GSDP
„ Urbanization
„ Inflation
„ Poverty
Overall
Performance
„ Agriculture
„ Consumer
markets
„ Education
„ Law & order,
justice
„ Health
„ Infrastructure
„ Investment
attractiveness
„ Budget &
prosperity
How rapidly
are regions
growing
„ Motor Spirit
„ Diesel
„ Credit
„ Deposits
„ Cereals

„ R-Square of
93% with
GSDP
Breadth of Social Progress
1. Demography: 0-6 sex ratio
2. Education: Literacy, female to male literacy,
gross enrollment ratio in elementary school
3. Health: IMR, fully immunized children
4. Prosperity: Poverty, Hunger

An equal weighted index constructed for all 593

districts
Socio-
economic
status
States in 2020
1. Prosperity: SGDP, Poverty
2. Health: Life expectancy, IMR
3. Education: Literacy
4. Demography: Age wise population
5. Projections based on trends since
nineties
 100

00
1010
2020
3030
4040
5050
6060
7070
8080
9090
100
Andhra Pradesh
Andhra Pradesh

Assam
Assam

Bihar
Bihar

Chhattisgarh
Chhattisgarh

Gujarat
Gujarat

Haryana
Haryana

Jharkhand
Jharkhand

Karnataka
Karnataka
2000
2020

Kerala
Kerala

Madhya Pradesh
Madhya Pradesh
Poverty

Maharashtra
Maharashtra

Orissa
Orissa

Punjab
Punjab

Rajasthan
Rajasthan

Tamil
TamilNadu
Nadu

Uttar
UttarPradesh
Pradesh
What will happen to the states

West
WestBengal
Bengal
What will happen to the states
Standard of Living
2000
2020
 What will happen to the states
Inequality, Migration & Freedom

„ Inequality between states will be higher

„ Migration
„ This internal migration will be affected by
Economic freedom
States that provide greater levels of freedom
to carry out economic activities will attract
and retain human resources
Economic Freedom and Migration
7.00

6.00
.

5.00
Out migration as % of Home Pop.

4.00
UP
Bihar
3.00

2.00 MP
Orissa
1.00
WB
Assam
0.00
0.00 0.10 0.20 0.30 0.40 0.50
Economic Freedom Index
What will the states be like in
2020
„ International Comparison
„ Based on Standard of Living (Purchasing
Power Parity, US dollars today)

How will the standard of living in the states

in 2020 be like, in terms of other countries
today
Andhra
= Bulgaria, = Angola,
Turkey Indonesia
Chhattisgarh

Assam Gujarat
= Pakistan, = Russia,
Zimbabwe Saudi Arabia

Haryana
Bihar =Uganda, = Brazil,
Bangladesh Mauritius
 Himachal Karnataka

= Turkey, = South
South Africa Africa/Chil
Hungary

J&K Kerala
= Iran ,
= Indonesia, Russia
Lebanon

MP
Jharkhand
=Angola,
= Zimbabwe, Indonesia
Sri Lanka
 Maharashtra Rajasthan

= Mexico, =Lebanon,
Argentina Iran

Orissa TN
= Russia,
= Ghana ,
Saudi
Zimbabwe
Arabia

Punjab UP
= Brazil, =Vietnam,
Mauritius Indonesia
WB
= Romania, Pondicherry = France,
Russia USA

Delhi
=New Chandigarh = Japan,
Zealand, USA
Japan

= Spain,
Switzerland

Goa
Thank You