Economy growth of Jharkhand has been slow in comparison with the national average. The economy depends mostly on mineral resources, industries, agricultural, and tourism sectors. The State’s Gross Domestic Product amounted to US $ 14 billion in 2004, which moved to US $ 22.46 billion in 2010-11. Jharkhand’s per capita income increased by 40.82 percent in the last ten years. The per capita GSDP in the State in 2000-01 was INR 16,084 (at 2004-05 prices), which increased to INR 27,180 in 2010-2011.
Jharkhand – Economy
The economy of the Jharkhand gets it revenue from the mineral resources sector for the State has a rich storehouse of minerals. The State has almost 40 percent of the mineral reserves found in India. The various kinds of minerals found in Jharkhand are iron ore, granite, coal, copper, mica, bauxite, and chromite. Jharkhand also exports its mineral products to various countries such as Saudi Arabia, Bangladesh, South Africa, and Nepal. This sector has given a major boost to the economy of the State.
The economy of the State of Jharkhand depends for its revenue on the industrial sector to a very large extend. This is due to the fact that the State has industrialized cities such as Bokaro, Jamshedpur, and Dhanbad. In Jharkhand there are companies like Tata Iron and Steel Company, Indian Tube Company, Sriram Bearing, Usha Martin, and Tata Engineering and Locomotive Company. The industries have contributed to the growth of the economy in Jharkhand.
The economy in the State of Jharkhand gets its revenue from the agricultural sector, as almost 75 percent of the people of the State are dependent on this sector. The various kinds of crops grown in Jharkhand are rice, oilseeds, wheat, potatoes, maize, and pulses. The State also produces a wide variety of vegetables and fruits like ladies finger, brinjal, tomato, cabbage, mango, lemon, and papaya. Jharkhand produced in land of round 18.05 lakh hectares more than 21 lakh tonnes of agricultural produce. This sector has also to a certain extend helped the State’s economy to grow.
Jharkhand’s economy also gets its revenue from the tourism sector but this sector’s contribution is comparatively less. This is due to the fact that although the State has places of religious and archaeological significance and also lakes, hills, and wildlife to attract the tourists, the State government has not fully exploited this sector.
The other sectors that contribute to the economy in the State of Jharkhand are cottage industry, IT industry, and silk goods. In order to boost the economy, the State government has started to make some efforts by developing the infrastructure and also by promoting the setting up of new industries.
The economy survey report 2011 says the performance of the primary sector declined in the last decade, though the secondary and tertiary sectors performed well in relative terms.
In the primary sector, agriculture growth remained stagnant in the last ten years, mainly due to inadequate irrigation. Jharkhand irrigated only 12 per cent of its cultivable land.
The primary sector, which also includes animal husbandry, forestry and fishing, declined to 23.30 percent of GSDP from 30 per cent in the last ten years.
However, Jharkhand is expected to collect US $ 463.32 million (INR 2,086 crore) as royalty from mining and sale of minerals in the current financial year 2010-11.
By December 2010, the royalty collection was US $ 284.65 million (INR 1,281.6 crore) In the financial year 2009-10, the royalty collection was US $ 384.31 million (INR 1, 730.3 crore).
Meanwhile, the Jharkhand government has proposed US $ 7.36 billion (INR 33,121.70 crore) Annual Budget for the coming fiscal year 2011-12, laying extra focus on development of infrastructure both in urban as well as rural areas and irrigation facilities.
The GDPS of the State has been projected to US $ 30.66 billion (INR 1,38,028 crore) in the coming fiscal year.
While the non-plan expenditure has been kept at US $ 3.58 billion (INR 16,096.77)crore against the current fiscal of US $ 2.89 billion (INR 13,022.82 crore), the government has identified road, energy, education, agriculture and health as thrust areas to work with enhanced fund allocation.
Agriculture is the main stay for the 80 percent of rural population of the State. It is their employment and primary income generating activity. The agricultural economy of the Jharkhand is characterized by dependence on nature, low investment, low productivity, mono cropping with paddy as the dominant crop, in inadequate irrigation facilities and small and marginal holdings. Agriculture activities are depended totally on rainfall and 92 percent of the total cultivated area is yet to come under irrigation.The cultivable land resources of the State have good potential for higher production of horticulture and forest products. The soil is young and has high capacity of fixation of humus. The forest provides sufficient biomass to feed its soiling. However, soil erosion and failure to recycle the biomass is depleting the soil fertility. Despite the fact that the State has a good rainfall, the surface water availability to agriculture is not sufficient due to inadequate storage facilities etc. as far as the status of ground water is concerned, it is also in the poor the State, due to little recharging of ground water by natural process in absence of artificial recharging facilities, as a result, the water label in the plateau is going down
Initiatives of the government to improve the agriculture sector.
- Encouraging shifting from the traditional mono – cropping to multiple cropping, horticulture, organic farming and diversified agriculture.
- Better management of natural resources for sustainable agriculture and post harvest management and processing.
- Improvement of the soil texture and structure by soil treatment programmes organized by the Department of Agriculture and the establishment of Soil Testing Laboratories to gauge the fertility status of the soil.
- Establishment / Renovation of Seed Village to increase the Seed Replacement Rate (the percentage of area sown out of the total area of crop planted in the season by using certified / quality seeds).
- Control of pest and diseases through Integrated Pest Management techniques to get maximum productivity.
- Increasing productivity by introducing intensive modern agricultural implements and minimizing cost of production.
Jharkhand has large deposits of minerals. 40 percent of the total minerals of the country are available in the State. The State is the sole producer of cooking coal, uranium and pyrite. It ranks first in the production of coal, mica, kyanite and copper in India. The geological exploration and exploitation of gold, silver, base metals precious stones etc. are the potential areas of futures. The principal export destinations for minerals are Bangladesh, Nepal, South Africa and Saudi Arabia.
The Industrial Policy covers the following clauses relevant to the mining
and mineral sector:
- Simplify procedures and expedite granting of mining leases.
- Provide relief to make mining activities easier.
- Encourage use of modern exploration techniques.
- Set up a resource inventory of various minerals in the State.
- Encourage joint venture projects with the State Mineral Development Corporation.
- Clear mining lease applications and project report within 60 days.
- Encourage foreign investment and technological collaboration.
Mineral Policy 2006
To facilitate systematic, scientific and planned utilization of mineral resources and to accelerate the mineral based development of the State; the Jharkhand Mineral Policy has been formulated. To ensure optimal utilization of available mineral resources, development of vast mineral potential, generate revenues for socio-economic development, impart boost to the economy of the State and enhance the employment opportunities.