All's not well in Haryana

Economic growth has dropped steadily over the last 5 years; widespread resentment at low growth, financial mismanagement

In August, Haryana Chief Minister Bhupinder Singh Hooda was booed off the stage at a public meeting in Kaithal, even as Prime Minister Narendra Modi, who was sharing the stage, urged the crowd to retain their composure. It was as if the resentment and discontent of the assertive voting populace of the state, accumulated through five years, was boiling over.

The hard facts on Haryana's development, or the lack of it, suggest the strong feelings aren't misplaced. Through the past five years, growth in Haryana's gross state domestic product (GSDP) has dropped steadily. While its GSDP grew 11.72 per cent in 2009-10, growth stood at 7.41 per cent in 2010-11 and 6.94 per cent in 2013-14 (provisional).(HARYANA FROM AN ECONOMIC PERSPECTIVE)

Though the pace of the deceleration in the state's economic growth was in sync with the drop in the country's economic growth, what led to concern was the situation in the state's agriculture sector. This sector, the primary means of livelihood in the state (43 per cent of the population is engaged in this segment), recorded contraction in two of the five years of Hooda's second term as chief minister.

While 2008-09 saw agricultural growth of 7.21 per cent, it stood at 7.41 per cent in 2011-12. Through the five years, growth in the sector averaged 2.7 per cent, lower than the national average. The state's populace rebelled when the government tried to take land away from it; 2011-12 saw a farmers' uprising in Rewari, against the state government's decision to notify about 3,700 acres of fertile agricultural land for acquisition for industrial purposes. Fatehabad saw a similar stand-off between the government and farmers; this time, the government had proposed a nuclear power plant be built on agricultural land.

Haryana has been reporting steady growth in the services sector; in 2009-10, it stood at 17 per cent. The share of this segment in Haryana's GSDP has risen from 52.7 per cent in 2009-10 to 58 per cent in 2013-14. But the growth has fallen steadily-from 10.67 per cent in 2011-12 to 9.35 per cent in 2013-14, prompting the Skill Development Corporation to recommend Haryana consider urgent intervention to bridge the skill gap, especially as the state was urbanising rapidly (urbanisation rate of 34.9 per cent, compared with the national average of 31 per cent) but its literacy rate was lower than the national average (73 per cent, compared to the all-India average of 74 per cent).

On other social indicators, too, the state fared poorly. Of all Indian states, Haryana has the lowest sex ratio, at 877, woefully short of the national average of 940. Though its child sex ratio (up to six years) has improved by 11 points between 2001 and 2011, it is still the lowest in the country, at 830.

Despite the urbanisation, industrial growth hasn't been impressive. In 2008-09, industrial growth in the state stood at 3.5 per cent; in 2013-14, it was 4.11 per cent. While discussing the 2013-14 state Plan with the CM, Montek Singh Ahluwalia, former deputy chairman of Planning Commission, hit the nail on the head when he said though Haryana's GSDP and per-capita income were among the highest in the country, more focus was needed to make growth more inclusive.

In terms of per capita income front, Haryana is one of the wealthiest states (Rs 1,23,000, compared with the national average of Rs 69,000). During Hooda's term, poverty declined pretty impressively-from 18.6 per cent in 2009-10 to 11.6 per cent in 2011-12 in rural areas, and from 23 per cent to 10.3 per cent in urban areas, during the same period.

Hooda's management of the state's finances has been uninspiring. Despite having a population with the capacity to pay for power, the state government raised power rates by only 60 paise a unit through five years, indicating lack of resolve to liquidate subsidies. And, despite the growth in the services sector, tax revenue, as percentage of GSDP, was 7 against the all states figure of 7.6. Also, despite its wealth, Haryana recorded a fiscal deficit of 3.6 per cent in 2008-09. Though this has fallen to 2.2 per cent, it is still higher than the all states estimate.