Previous Budget Speeches


Economic Survey 2001-2002

General Review

1.1 Andhra Pradesh is richly endowed with natural and competitive advantages with a geographical area of 274.40 lakh hectares. A.P. is the fifth largest State in the country. The net area sown is of the order of 110 lakh hectares constituting about 40 per cent of the geographical area. The State has about 63 lakh hectares of forest area, accounting for about 23 per cent of the geographical area. The state has the second largest coastline of 974 Km. The total surface water of entire river system of the State is estimated at 2746 TMC. The State has a spectrum of tourism locations ranging from historical and religious sites to natural attractions, like beaches.

1.2 Andhra Pradesh is the fifth most populous state with a population of 6.65 crores as per 1991 census. About 73 per cent of the State's population live in rural areas. The work participation rate in the State as per 1991 census at 45 per cent is above the All India rate of 38 per cent. As per the Mid Financial Year (Ist Oct) population estimates prepared by Central Statistical Organisation (C.S.O), the State's population in the year 2000-2001 is projected at 7.60 crores. As per the comparable estimate of Gross State Domestic Product, prepared by C.S.O. (1997-98) A.P State is the fifth largest economy in the country after Maharashtra, Uttar Pradesh, Tamilnadu and West Bengal.

Gross State Domestic Product (GSDP)

1.3 The advance estimates of Gross State Domestic Product (GSDP) at constant prices (1993-94) for the year 2000-2001 work out to Rs.82434.19 crores as against the quick estimates of Rs.78393.81 crores for the year 1999-2000 showing a growth rate of 5.15 per cent. Though the seasonal conditions during South-West monsoon were good, due to severe adverse seasonal conditions during North-East monsoon, the gross value added from Agriculture did not show significant increase over that of previous year. There is significant deceleration in the Industries sector. The services sector continues to show impressive growth. The per capita income at constant prices (1993-94) for the year 2000-2001 is estimated at Rs.9697 as against the quick estimate of Rs.9318 for the year 1999-2000 registering a growth rate of 4.07 per cent. For the first time estimates of District Domestic Product by adopting the standard methodology suggested by C.S.O. have been prepared by the Special Monitoring Cell, Planning Department for the years from 1993-94 to 1997-98 to monitor the growth in different sectors of the Economy at the disaggregate level, keeping in view the goals set in under vision 2020.

State's own Taxes during 2000-2001

1.4 The Revenue Receipts under State's own Taxes during 2000-2001 (upto 15th January, 2001) work out Rs.7381.82 crores as against the targeted revenue receipts of Rs.10,756.37 crores, constituting about 68.6 per cent. Sales Tax is the major source of revenue in the State. The revenue realised through Sales Tax during 2000-2001 (upto 15th January, 2001) works out to Rs.5099.16 crores as against a targeted amount of Rs. 7,202.00 crores, constituting about 70.80 per cent. During the year 2000-2001 (upto 15th January, 2001) the revenue realised under State Excise, Motor Vehicles and Stamps and Registration works out to Rs.914.47 crores, Rs.594.61 crores and Rs.486.14 crores respectively constituting 65.32 per cent, 59.46 per cent and 74.79 per cent respectively when compared with the respective targets. In the case of non-tax revenue, the progress is not satisfactory. As against the targeted non-tax revenue of Rs.1,756.59 crores, the achievement (upto 15th January, 2001) was Rs.573.19 crores constituting about 32.63 per cent. Non-Tax revenue from Mines and Minerals is the predominant.

1.5 The Index Number of wholesale prices of Agricultural commodities during 2000-2001 (April-Oct) in the State showed an increase of 0.1 per cent when compared with that of the corresponding period of previous year. The Consumer price index for Industrial Workers (CPIIW) which is being compiled for 12 centres in the State showed an increase of 6.0 per cent during 2000-2001 (April-Oct) when compared with that of the corresponding period of previous year. The Consumer price index number for urban non-manual employees (CPIUNME) which is being compiled by C.S.O. showed an increase of 6.7 per cent during 2000-2001 (April-Nov) when compared with that of the corresponding period of last year. The consumer price index number for agricultural labourers (CPIAL) which is being compiled by Labour Bureau, Simla with 1986-87 as base year has shown an increase of 3.9 per cent during 2000-2001 (April - October) when compared with that of corresponding period of last year. The State Government initiated appropriate measures to curtail the rise in prices. A special Cell was established to monitor the prices of essential commodities and initiate necessary remedial measures. Establishment of Rythu Bazars to avoid middlemen from the sale of commodities in between producers and consumers is yielding good results.

During the South-West monsoon (June-Sept)

1.6 During the South-West monsoon (June-Sept) which accounts for about 70 per cent of the Annual rainfall, good seasonal conditions prevailed and the rainfall received was excess by 22 per cent. All the Districts except Vizianagaram district received more than the normal rainfall. However during North-East monsoon (Oct--Dec) severe adverse seasonal conditions prevailed and the rain fall received was deficit by 59 per cent. All the districts except Anantapur received less than the normal rainfall.

1.7 As per the advance estimates for the year 2000-2001 the area sown under foodgrains is likely to increase from 71.40 lakh hectares in 1999-2000 to 72.63 lakh hectares. The area sown under Oil-seeds is likely to be of the order of 26.90 lakh hectares, showing an increase of 5.44 per cent over that of 1999-2000. The production of food grains is likely to be of the order of 140.27 lakh tonnes as against 136.97 lakh tonnes during 1999-2000 showing a meagre increase of 2.41 per cent. The production of Rice which is one of the nineteen growth engines is likely to reach 111.17 lakh tonnes showing an increase of 4.50 per cent over that of last year. The production of oil seeds is likely to be of the order of 23.01 lakh tonnes showing an increase of 69.07 per cent over that of previous year. A New scheme "Rashtriya Krishi Beema Yojana" covering all farmers (both loanee and non loanee) and covering commercial crops is being implemented from kharif 2000.

1.8 Andhra Pradesh is endowed with varied agro-climatic conditions for growing varieties of horticulture crops like fruits, vegetables, spices, tuber crops, plantation crops, floriculture. An area of about 13.35 lakh hectares is under various horticulture crops with an estimated production of 70.42 lakh M.Tons. A.P. State is recognised as the best potential State and pioneer in Oil-Palm cultivation which accounts for about 60 per cent of the country's area under oil-palm and ranks first in Area and Production.

1.9 Fisheries is one of the growth engines under Vision 2020. The State ranks second in inland fisheries, First in coastal acquaculture and seventh in marine fish production. It is a potential income generation sector with 21.50 lakh persons employed in different activities. The State contributes about Rs.1300 crores of Marine product exports sharing more than 30 per cent of value of exports from the country. The fish seed production has increased from 988 lakhs in 1998-99 to 3100 lakhs in 1999-2000. This increase in fish seed production was responsible for a higher growth rate in inland fish production during 1999-2000.

1.10 As per the 16th quinquennial Live Stock census conducted during the year 1999, an increase of 31.4 per cent in Poultry was observed when compared with that of the previous census conducted during 1993. Poultry is one of the growth engines under Vision 2020. According to an integrated sample survey the total milk production in the state during 1999-2000 was estimated to be 4950 million tonnes.

1.11 The State has 63814 of forest area contributing about 23 per cent of the total geographical area. 6575 Vana samrakshana samithis are functioning managing an area of 16.52 lakh hectares.

1.12 Sericulture is an agrobased labour intensive industry providing gainful employment mostly to rural people. The state occupies second position in the country in the production of silk. The production of reeling cocoons increased from 30,179 Mts. In 1998-99 to 34,193 MTs in 1999-2000, while the production of Mulberry raw silk increased from 3335 MTs. In 1998-99 to 3,757 MTs. In 1999-2000.

1.13 There is significant deceleration in the Industries sector. The average Index Number of Industrial production in the State with base 1993-94 showed a meagre growth rate of 1.7 per cent in 2000-2001 (upto Nov.2000) when compared with that of the corresponding period of previous year. Manufacturing showed a growth rate of 2.1 per cent while both Mining & Quarrying and Electricity showed negative growth rates of 0.3 per cent and 0,2 per cent respectively. As per use-based classification the growth during 2000-2001 (upto Nov) when compared with that of corresponding period of last year is 26.7 per cent in capital goods, 10.7 per cent in intermediate goods and -1.4 per cent in basic goods. During the same period, while there is positive growth rate of 12.4 per cent in consumer durables, there is a negative growth rate of 4.5 per cent in consumer non-durables.

1.14 Though the strikes and lockouts declined during the year 2000 (Jan-Dec) the number of man-days lost were 29.54 lakh.

The seventh partnership summit

1.15 The seventh partnership summit organised by the Confederation of Indian Industry (CII) was held in Hyderabad. The State Government utilised the occasion to reiterate its commitments to carry on with the second generation economic reforms. The State Government signed MOU with private promoters on as many as 70 projects involving an investment of Rs.35, 861.10 crores. Five projects handled by the Transport, roads and Building Department accounted for the lion's share of Rs.24, 333 crores and they include the Rs.19, 500 crores LNG project at Kakinada. Tourism accounts for 19 projects (Rs.253.50 crores) while 27 projects (Rs.4, 336 crores) were in the field of Industries and Commerce Seventeen projects (Rs.6, 718 crores) would come up in the I.T. and Communications sector while two projects (Rs.220 Crores) were in the field of Municipal Administration and Urban Development.

1.16 The working results of 40 State Level Public Enterprises (SLPEs) during 1998-99 revealed that 21 SLPEs contributed a profit of Rs.285.47 crores, while 17 SLPEs incurred a loss of Rs.392.35 crores. 2 SLPEs reported no profit/no loss. Thus there is a net loss of Rs.106.87 Crores, during the year 1998-99.

1.17 The installed capacity including Central Sector as on 30.11.2000 is 7935.81 M.W. The power generation available for use during 2000-01 (Upto 11/2000) was 29112.35 M.U. The gross generation of power in the State increased from 29667 M.U. in 1999-2000 (April.99-Nov.99) to 30519 M.U. in 2000-01 during the same period. 1.11 Crore consumers were served during 1999-2000 as against 1.06 crore during 1998-99. The per capita consumption is 500 KWh during 1999-2000 as against 480 K.Wh. during 1998-99. Despite the impressive growth in installed capacity the State is facing shortage of power. The capacity addition is not adequate to meet the growing demand. To meet the energy needs the state is purchasing power from other States and Central Sector generating stations to the extent feasible.

1.18 As on 1-1-2001 the total road network is at 194523 kms out of which National Highways constitute 4104 kms, the state roads constitute 7952 kms and major district roads constitute 34168 kms. The remaining length is accounted by other category roads.

The Andhra Pradesh State Road Transport Corporation (APSRTC)

1.19 The Andhra Pradesh State Road Transport Corporation (APSRTC) is the largest State Road Transport undertaking in the country. The fleet strength of the Corporation grew from 18526 as on 31.3.1999 to 19021 as on 31.3.2000. The corporation is first in fleet utilisation in the country by achieving 98.47 per cent fleet utilisation in 1999-2000. All the 209 depots where the fleet is based for operation have been computerised and linked in a dial-up network. The corporation operates over 59.00 lakh Kms. Per day, carrying 1.19 crores of passengers daily. The Corporation has improved its fuel efficiency from 5.05 Kms. In 1998-99 to 5.07 Kms per litre in 1999-2000. Constant monitoring of the utilisation of Human Resources has resulted in improved employee's productivity from 43 Kms in 1998-99 to 44 Kms in 1999-2000.

1.20 The total length of railway lines in the state as on March,1999 was 4598 kms comprising of 3875 kms of broad gauge , 686 kms of metre gauge and 37 kms of narrow gauge.

1.21 By the end of June 2000 there were 5112 Bank offices of scheduled commercial banks and the deposits in all the Scheduled Commercial Banks in the State increased to Rs.47, 037.10 crores from Rs.39, 275.91 crores by June 1999. During the same period, the advances also increased from Rs.25665.67 crores to Rs.30, 319.17 crores. The credit deposit ratio by the end of June (2000) works out to 64.5 per cent as against 65.3 per cent by the end of June 1999.

1.22 The Enrolment rate in primary schools during the year 1998-99 works out to 96.89 as against All India rate of 92.14. However, drop out rate is still alarming at more than 40 per cent. The literacy rate in Andhra Pradesh during 1997 was 54 per cent as against the literacy rate of 62 per cent in All India. In the case of birth rate the State's performance is good, as the birth rate during 1999 was 21.7 as against 26.1 for All India. In the case of Death rate (1999), infant Mortality rate (1999) and expected life at birth (1991-95) the State's performance is better than All India performance. As per the poverty estimates released by Planning Commission (1993-94) based on Modified Expert group methodology, the percentage of people below poverty line in A.P. works out to 22.19 as against 35.97 for All India.

1.23 According to employment Market information there were 20,195 establishments in the organised sector in A.P. employing 20,71,642 persons as at the end of March 2000. As per the employment exchange statistics, a total number of 3,10,315 candidates have enrolled their names at the employment exchanges during Jan to October 2000. The total number of job seekers on the live register increased from 30,83,779 in October, 1999 to 31,32,200 in October, 2000 with a marginal increase of 1.6 per cent.

1.24 A draft Vision 2020 document, first of its kind in the Country was released on 26th January, 1999. As per the Vision statements by 2020 the state will have to achieve a level of development that will provide its people tremendous opportunities to achieve prosperity, well being and a high quality of life. To achieve the goals A.P. Economy will have to be stimulated to grow by 9-10 per cent a year on an average in real terms. A Special Monitoring Cell has been established in the Planning Department for monitoring various developmental indicators keeping in view the goals set in under Vision 2020.

The Average annual growth rate in GSDP

1.25 The Average annual growth rate in GSDP during the first Five Years of the Vision (1995-2000) work out to 5.17 per cent as against the targeted average annual growth rate of 5.70 per cent. The average annual growth rate in per capita income works out to 3.88 per cent as against the targeted growth rate of 4.40 per cent. In the case of population, the average annual growth rate works out to 1.27 per cent as against the targeted growth rate of 1.30 per cent. In Agriculture sector, against the targeted growth rate of 3.7 per cent the average annual growth rate works out to 3.27 per cent. In the Industry sector the average annual growth rate works out to 5.35 per cent as against 5.3 per cent. In services sector the average annual growth rate works out to 6.87 per cent as against 7.0 per cent. During the first Five Years of the Vision, the performance of the State Economy is satisfactory, despite two bad years due to failure of both the monsoons. The targets during the second five years (2000-2005) are on the higher trajectory and there is need to accelerate the growth in the growth engines identified to achieve the targets.


1.26 Janmabhoomi (J.B.) is a people centred development process launched in January 1997. So far 14 rounds of J.B. were held. The core areas of J.B. are Community works, Primary education, Primary health and family welfare, Environment conservation and Responsive governance.

1.27 Clean and green campaign was launched in the state on 10th September 1998. The campaign focuses on the major areas of water supply, sanitation, tree plantation and health awareness. Self help groups viz., Vanasamrakshana samithis, watershed committees, water users associations, CMEY, DWCRA etc are yielding good results.

1.28 The Neeru - Meeru programme launched by Government during April 2000 has a firm action plan to achieve sustainable water security. During Phase - I (April, 2000 to October, 2000) 800 lakh cu.m earth work was done. The various activities and efforts have had a positive impact on the ground water levels in the state. The programme is now into its second phase.