Gujarat sees significant rise in country’s GDP share in last 2 decades: EAC-PM paper

Gujarat has seen a significant increase in its share in India’s GDP in the last two decades, while consistently performing well throughout the study period from 1960-61, a paper by the Economic Advisory Council (EAC) to the Prime Minister said on Tuesday. 

The state’s share had increased from 5.8 per cent in 1960-61 to 6.7 per cent in 1970-71. It, however, then remained at broadly the same levels until 2000-01, before beginning to increase rapidly.

"Its share rose to 8.1 per cent in 2022-23. It is interesting to note here that Gujarat and Maharashtra were part of the same Bombay state until 1960. While Maharashtra has been able to maintain its share in India’s growing economy, Gujarat’s share was broadly flat until 2000-01 before it took off," the EAC-PM paper said.

Gujarat’s share remained at broadly the same levels until 2000-01, before beginning to increase rapidly - from 6.4 per cent in 2000-01 to 8.1 per cent in 2022-23. By 2023-24, Gujarat’s per capita income rose to 160.7 per cent of the national average, from 118.3 in 1960-61.

Initially, Gujarat lagged Maharashtra, with a relative per capita income of 118.3 per cent compared to Maharashtra’s 133.7 per cent in 1960-61. This disparity persisted until 2010-11, when it surpassed Maharashtra. By 2023-24, Gujarat’s per capita income has risen to 160.7 per cent of the national average, as compared to 150 per cent for Maharashtra, according to the paper.

It noted that Maharashtra, Gujarat, Delhi, and Haryana have shown steady performance, while West Bengal experienced persistent relative decline.

"The western and southern regions of India have performed notably better than other parts of the country. Maharashtra and Gujarat have consistently demonstrated strong economic performance over the years," the paper noted.

The paper focused exclusively on the relative performance of states, measured using two indicators - share in India’s GDP and relative per capita income. The state's share in India’s GDP is calculated by dividing the Gross State Domestic Product (GSDP) of the state by the sum of GSDP of all states. Relative per capita income is calculated as the ratio of the per capita Net State Domestic Product (NSDP) of the state as a percentage of the all-India per capita Net National Product (or Net National Income in some years).