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POVERTY REDUCTION STRATEGY TN

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Table 2.2 indicates sectoral shares of employment and corresponding growth<br />

rates in recent years. It can be seen that the growth in agriculture employment during<br />

1993-94 to 1999-00 and 1999-00 to 2004-05 has been negative. At successive 5 year<br />

intervals, the agriculture share in total employment has progressively come down.<br />

Correspondingly, shares of other sectors have gone up.<br />

b. Sectoral Growth Pattern<br />

Table 2.3 shows the sectoral growth pattern. The average growth in the primary sector<br />

and particularly in agriculture has been low. The average annual growth rate in<br />

agriculture was about 2 percent during 1994-95 to 2006-07. In the first four years of the<br />

current decade, growth rates of the primary sector and agriculture have been negative.<br />

Table 2.3: Average Annual Growth Rates: GSDP at Constant Prices<br />

(Percent)<br />

Sectors<br />

1994-95 to<br />

1998-99<br />

1999-00 to<br />

2003-04<br />

2004-05 to<br />

2006-07<br />

1994-95 to<br />

2006-07<br />

Primary of which 3.073 -4.173 7.825 2.051<br />

Agriculture 3.232 -5.267 8.462 1.951<br />

Secondary of which 5.811 4.723 6.898 5.638<br />

Manufacturing 4.365 4.855 9.282 5.482<br />

Tertiary 9.687 5.665 8.589 7.996<br />

GSDP at 1999-00 prices 6.780 3.645 7.977 6.002<br />

Population 1.070 0.915 0.820 0.949<br />

State Per Capita Income<br />

(Rs.) 5.650 2.705 7.099 5.006<br />

Source (Basic Data): Government of India, Central Statistical Organisation, various issues.<br />

As depicted in Chart 2.1, agriculture is characterized by low average growth<br />

rate with high volatility. During 1994-95 to 2006-07, the average growth rate has been<br />

about 5.6 percent in the secondary sector and close to 8 percent in the tertiary sector.<br />

There are signs that the Tamil Nadu economy has emerged out the recession of the early<br />

years of the decade with the overall GSDP growth during 2004-05 to 2006-07 close to 8<br />

percent per annum on average.<br />

Chart 2.1 shows the sectoral growth pattern in Tamil Nadu, bringing out the<br />

sectoral volatility of the primary sector and the fact that all the sectors went through a<br />

recession in recent years, but growth is now picking up. The formulation of a medium to<br />

long term fiscal strategy requires to take into account the changing structure of the state<br />

economy.<br />

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