Maharashtra has emerged as a powerhouse of industrial growth, securing the highest number of approved projects in India between April and December 2023, according to the state’s latest economic survey. Despite this feat, Gujarat leads in terms of investment inflows, reflecting a dynamic economic landscape where Maharashtra’s 264 projects worth Rs 59,551 crore stand against Gujarat’s 190 projects with investments totaling Rs 62,535 crore.
The survey underscores Maharashtra’s pivotal role in foreign direct investment (FDI) inflows, capturing 30% of India’s total from October 2019 to December 2023. This dominance places Maharashtra ahead of Karnataka, which accounts for 22% of the country’s FDI inflows during the same period. Moreover, Maharashtra boasts the highest concentration of Government of India-recognized startups, comprising 19% of the nation’s total by March 2024.
Looking into sectoral dynamics, the survey forecasts a robust industrial growth rate of 7.6% for 2023-24, buoyed by a notable recovery in the manufacturing sector, expected to escalate from 2.1% to 7.5%. Conversely, challenges loom over the construction sector, which anticipates a decline from 14.5% to 6.2%. Meanwhile, mining and quarrying are set to experience growth, projecting an increase from 5.3% to 9.1%.
In the services segment, the survey points to varying trajectories: while segments like trade, hotels, transport, and communications are slated to slow down significantly from 13% to 6.6%, public administration and defence sectors are expected to see growth moderate from 15.7% to 7.6%. Similarly, the financial services and real estate sector might witness a dip from 12.2% to 10.1%, indicative of sector-specific challenges amidst broader economic resilience.
Amidst economic strides, agriculture in Maharashtra faces formidable challenges, exacerbated by a rainfall deficit affecting 146 talukas in 2023-24. This has led to anticipated declines in kharif season crop production, including cereals (-23%), pulses (-10%), oilseeds (-2%), and sugarcane (-17%).
Despite these challenges, the survey highlights positive trends in labour force dynamics, with an increase in labour force participation rate (LFPR) and a decline in unemployment rates from 3.5% to 3.1% in 2022-23. However, concerns persist over rising numbers on live registers for skill development and employment, reflecting ongoing efforts to match job demand with skill availability.
Furthermore, amidst social tensions over quotas, the survey reveals increased expenditure in schemes aimed at marginalized communities, with significant hikes in spending under Scheduled Caste and tribal component schemes, underscoring governmental efforts towards inclusive growth strategies.
As Maharashtra navigates these economic landscapes, the survey points to both opportunities and challenges, urging strategic interventions to sustain growth momentum while addressing sector-specific vulnerabilities.
