Andhra Pradesh   

Good show... could have been better

Andhra Pradesh has always been open to reforms. Somehow, this has not reflected on the State's overall performance, which has hovered below the all-India figures. Focus on priority areas is the only way out

The State of Andhra Pradesh was formed merging regions with varied endowments, historical legacies and institutional arrangements. The challenge of development policy was to integrate these diverse units such as underdeveloped Telangana, drought-prone Rayalaseema and coastal Andhra into a single economic entity and to accelerate growth and equity.

The focus of the Government policy in the 1960s and 1970s was on infrastructure like irrigation and power. The historical advantage that coastal region enjoyed in canal irrigation was reinforced with the advent of the Green Revolution. The Government in the 1980s concentrated more on welfare policies, `Rs. 2 a kilo rice scheme' being one of them.

Welcome liberalisation

The 1990s witnessed liberalisation of economic policies in the country and in Andhra Pradesh, reforms were initiated in the mid-1990s. By the end of 1990s, the State earned a reputation of being in the forefront of reforms in India as several fiscal, governance and sectoral reform initiatives began here.

In general, overall performance indicators in the 1960s and 1970s show that the State was ahead of some of the northern States but behind some of the western and southern ones. Unfortunately, the situation is same even in the first decade of the new millennium. India Today has been giving ranks of no.1 or no.2 to Andhra Pradesh. But reality is different. There have been many improvements in absolute sense in the last 50 years but relative position remained more or less the same. The performance in general has been closer or marginally below that of all India.

Grim reality

Economic growth in terms of GSDP growth was less than 2 per cent in the 1960s and 3.3 per cent in the 1970s. It increased to more than 5 per cent per annum in the 1980s and 1990s. The State has not increased its growth in the post-reform period as compared to 1980s. The per capita income has always been lower than all India. The answer for relatively low growth lies in low physical and human infrastructure in the State.

Though the State was among the very few in the country to herald Green Revolution in the 1970s, growth rate of agriculture has been less than that of all India in the five decades. Compared to some of the western States, Andhra Pradesh is lagging behind in industry. But service sector has picked up in the last two decades, constituting more than 50 per cent of the GSDP share. The success of IT sector in the State is well known.

SHGs, a bright spot

Turning to social sector, there have been improvements in education, health and poverty reduction. Population growth declined significantly. Women's self-help group movement has been a success. However, the human development index rank is still low at 10 among 15 States. The official poverty ratio declined from 49 per cent in 1973-74 to 15.8 per cent in 1999-00 but alternative estimates show that poverty is high in the State.

Literacy increased from 13 per cent in 1951 to 61 per cent in 2001. But, the rank is very low at 26 out of 32 States/Union Territories. Nearly 50 per cent of women are still illiterate.

Where are the jobs?

Infant mortality declined from 91 per 1000 in 1961 to 66 per 1000 in 2001 the State is ranked 23rd out of 32 States/UTs. Employment growth in the State was one of the lowest in the last decade. Unemployment among youth could be one of the reasons for the rise of naxalism in the State. What is the balance sheet on the economic and social performance of the State in the last 50 years?

Moments of pride...

The achievements are: green revolution, diversification in agriculture, irrigation focus in the initial years, increase in economic growth in the 1980s and 1990s, decline in population growth, better public distribution system, success of self help groups, other institutions like water user associations and joint forest management, IT revolution etc.

... and some falls

The failures and the present problems are: low physical and human infrastructure, lower growth rates in GSDP, agriculture and industry, unsuccessful land reforms, low human development and employment growth, lack of decentralization, regional disparities leading to social unrest, inequalities among social groups, gender inequalities etc.

The State is currently known for the success of PDS, Information Technology, women's self help groups and expansion in irrigation. Unfortunately it is also in the news for farmers and weavers' suicides and social unrest.

One of the problems in the policies has been the neglect of agriculture and rural areas particularly in the post-reform period. Unemployment rate and malnutrition are high in the State. Recent NSS survey for the year 2004-05 shows that rural unemployment rate at 10.9 per cent was higher than the all India figure of 8.2 per cent.

Solutions in sight

What should be done to improve economic and social development in Andhra Pradesh in the next ten years? The State has to move towards faster and inclusive growth. Firstly, for faster growth, the State has to increase public and private investment in infrastructure. Secondly, in order to have inclusive growth, the State has to concentrate on agriculture, poverty, employment, social development and regional disparities.

Thirdly, the present Government's emphasis on irrigation is in the right direction for agriculture growth. However, measures beyond irrigation are needed to reduce farmers' suicides. For example, marginal and small farmers still get 80 per cent of their credit from money- lenders. Similarly industrial development and rural non-farm sector are crucial for employment generation.

Director, CESS

Prof. S. Mahendra Dev

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