Assam would need Rs 2 lakh cr investments to touch double-digit growth: Assocham

The decadal growth clocked by the state during 2004-05 to 2014-14 had been around 6%

A study done by the industry body Associated Chambers of Commerce and Industry of India (Assocham) found that Assam would need investments worth Rs 2 lakh crore to attain double digit economic growth in near future. Only a double-digit growth rate, found the study, would help the state meet the potential demand for employment in near future.   

The decadal growth clocked by the state during 2004-05 to 2014-14 had been around six per cent and the industry body is of the view that issues like dearth of good governance, unemployment, inadequate basic infrastructure, sickness in micro, small and medium enterprises (MSMEs), primitive techniques and others are dogging the agriculture and industrial sectors. 

 

D S Rawat, secretary general of Assocham, said that not all big ticket investments would be of help in improving the economy of the state or in creating large scale employment. Rather Rawat, who was speaking to media persons here today, said the state should encourage the growth of MSME sectors which would boost the local economy and would create jobs. 

“Assam needs to perk up agriculture and allied activities as almost half of the state’s total workforce and 75 per cent of the total population are directly or indirectly engaged in this sector for their livelihood,” he said. 

The agriculture sector’s share was just about 20 per cent in gross state domestic product (GSDP) in 2014-15 thereby registering a steady decline from 25 per cent in 2004-05 and clocked a meagre three per cent compound annual growth rate (CAGR) during this period, noted the study paper of Assocham.   

Industry performance in Assam too paints a grim picture as the sector recorded a meagre 18 per cent share in GSDP and grew at just about five per cent CAGR between 2004-05 and 2014-15, found the study. The share of services sector in 2014-15 was around 56.8 per cent. 

The study suggested that the state government should focus on developing infrastructure in the state through public-private-partership (PPP) mode. As on September 2015, Assam had received PPP projects worth Rs. 3,016 crore which is just 0.4 per cent hsare in India’s PPP investments. Sprisingly, 61.3 per cent of PPP projects have been terminated whereas 33.7 per cent are under construction stage and only 4.5 per cent of PPP projects are under operational stage. 

In terms of foreign direct investments (FDI), the state could only record Rs. 1,037 crore intention from January to November 2015, which was just 0.36 per cent of total FDI intention the country received.