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Economic survey calls for pro-farmer Budget

Maha economy to grow at 8% as against 5.8% previous year * Negative growth of 2.7% in agri sector a drag

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Consecutive years of drought and agrarian distress have taken their toll on the state economy, with 2.7% negative growth in agriculture serving as a drag on it. According to the Economy Survey of Maharashtra 2015-16, tabled in the state Assembly on Thursday, the only bright spot in state's otherwise stressed economy is the services sector, which is likely to grow at 10.8%, followed by industry, which is expected to grow at 5.9%.

The survey, however, pegs state's economy to grow at 8% as against 5.8% the previous year.

The de-growth in agriculture, which employs the highest number of people, may prompt finance minister Sudhir Mungantiwar to table a pro-farmer budget to give a booster shot to the rural and agrarian economy.

The state may have to push for shifting some of the workforce from agriculture to other sectors like manufacturing to ease population pressures which have made farming unviable. For instance, the average size of operational holdings has declined to 1.44 hectare in 2014-15 from 4.28 hectare in 1970-71 due to fragmentation.

"As per advance estimates, Gross State Domestic Product (GSDP) for 2015-16 at constant (2011-12) prices is expected to be Rs 16,47,045 crore. The agriculture and allied activities sector is expected to decline by 2.7% while industry and services sectors are expected to grow at 5.9% and 10.8% respectively over the previous year," it said.

"Decline in agricultural output for two consecutive years has adversely affected (the) rural economy which is highly dependent on agriculture. However, better performance of services and industry sectors has contributed to growth in state economy. At this backdrop, advance estimates of GSDP at constant (2011-12) prices maintained fairly decent growth of 8% over the previous year," the survey said.

"As per the first revised estimates, GSDP at constant (2011-12) prices is Rs 15,24,846 crore during 2014-15, as against Rs 14,41,843 crore in 2013-14, showing an increase of 5.8%. GSDP at current prices during 2014-15 is Rs 17,92,122 crore," it noted, adding that the per capita income in 2014-15 was Rs 1,34,081.

"The gap between rural and urban areas must not increase," noted farmer-activist Vijay Jawandhia, stressing that an income guarantee was needed for rain-fed farmers who otherwise got very little subsidy support compared to irrigated agriculturists.

"In this budget, the government must think out of the box and ensure that labour activities from sowing to cutting on farms of non-irrigated agriculturists are carried out under the state's employment guarantee scheme," he noted.

The survey said that the total rainfall in the state during 2015 was just 59.4% of the normal.

In the 2015 kharif season, sowing was 6% less than the previous year, while in area under rabi crops was expected to reduce by 16%. This will result in a decline in foodgrain and oilseeds production.

Economist Abhay Tilak noted that agriculture in Maharashtra suffered from structural defects like large number of the workforce depending on it, fragmented holdings, stagnant irrigation and low production. "Even if these two years saw good rains, the scenario would not have changed," he noted, pointing to the lopsided development model accepted by the state which has seen low HDI in districts which were less urbanised, backward and depended on rain-fed agriculture.

The average consumer price index (CPI) for rural and urban areas in Maharashtra from April to December 2015 has increased by 2.7% and 3% respectively over the corresponding period for the previous year. The year-on-year rate of inflation based on CPI for rural areas decreased from 4.8% in April 2015 to 2.6% in December 2015 whereas for urban areas, it decreased from 4.7% to 3.5%.

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