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India's political sphere gears up for the impending showdown of the general elections. With each party clamouring to secure voter allegiance, the stage is set for a battle of narratives, with economic performance looming large on the electoral horizon.

 

At the heart of this lies the economic issues, ranging from GDP Growth to inflation and welfare spending. Deciphering Indian states economic situation reveals complex macroeconomic indicators and ground-level experiences, each influencing voter sentiment and shaping electoral outcomes.

 

Reflecting on the conditions preceding the 2019 elections reveals a period of relative economic buoyancy, characterized by robust GDP growth and stable inflation rates. The government’s emphasis on welfare schemes, including cash transfers and basic amenities, bolstered its electoral standing setting the stage for a convincing victory.

 

Despite the rollout of ambitious schemes such as piped water connections and expanded food subsidies, questions linger over their efficacy in swaying voter sentiment amidst persistent economic challenges.

 

As the countdown to the Lok sabha elections 2024 begins, to be held in 7 phases, starting on April 19^th and counting votes on June 4, political narratives are set to pivot around economic performance.

 

The ruling BJP touts its handling of inflation and pandemic- induced crises, while the opposition seeks to capitalize on perceived shortcomings.

 

Uttar Pradesh (UP) stands out as a shining beacon of economic growth. A recent report heralds UP's ascent as the second-largest economy in India, surpassing Tamil Nadu. An achievement emblematic of the state's remarkable strides in economic development.

 

UP's rise to economic prominence can be attributed to several key factors. Firstly, the state's focus on infrastructure development has spurred investments in crucial projects encompassing roads, railways, highways, and airports. Secondly, UP's robust industrial production has been bolstered by strategic policies aimed at attracting investments in key sectors such as manufacturing, food processing, pharmaceuticals, and textiles. Thirdly, a concerted effort towards skill development has equipped UP's workforce to meet the demands of burgeoning industries, thus fuelling economic growth. Lastly, the state's rich historical and cultural heritage, epitomized by iconic landmarks like the Taj Mahal, has positioned UP as a coveted destination for tourism and cultural exchange.

 

According to provisional estimates for Q2 FY 2023-24, UP ranks as the second-largest economy in India, trailing only behind Maharashtra. With a GDP of ₹29.53 lakh crore, UP's growth highlights   emergence as a significant economic force.

 

Maharashtra retains its status as India's top GDP contributor, boasting a diverse economy with significant contributions from sectors like manufacturing, finance, and services.

 

The top 3 largest economies as of Q2 FY 2023-24 provisional estimates are Maharashtra at ₹32.39 lakh crore, Uttar Pradesh at ₹29.53 lakh crore and Tamil Nadu at ₹28.51 lakh crore. Whereas, Gujarat stands at 8.2%, West Bengal at 7.5%, Karnataka at 6.2%, west Bengal at 7.5%, Karnataka at 6.2%, Rajasthan at 5.5%, Andhra Pradesh at 4.9%, and Madhya Pradesh at 4.6%

 

However, amid the glitz and glamour of economic success stories, the stark reality of regional disparities looms large. Bihar, with a GDP contribution of only about 3.1% to India's overall GDP, grapples with entrenched challenges of poverty, unemployment, and underdeveloped infrastructure.

The recent designation of Bihar's Begusarai as the "most polluted metropolitan area in 2023" takes into account the urgent need for comprehensive developmental interventions in the state.

 

Budget Analysis 2024

 

As India prepares for the imminent Lok Sabha elections 2024, insights into the budgetary allocations and policy highlights of various states offer a glimpse into their developmental trajectories and priorities.

 

1.     Delhi: Finance Minister Atishi announced the budget for the financial year 2024-25 on March 4th, with an estimated expenditure of ₹71,086 crore—marking a 2% increase from the revised estimates of 2023-24.

 

Noteworthy policy highlights include the Mukhyamantri Mahila Samman Yojana, allocating Rs. 2,000 crore to provide Rs. 1,000 per month to every adult woman, excluding income tax payers. Additionally, to bolster last-mile connectivity, Delhi plans to procure 2808 e-buses in 2024-25, aiming for a fleet of over 10,000 buses, with 80% being e-buses. Projections indicate Delhi's GSDP to grow at 7.4%, driven by the agriculture, manufacturing, and service sectors.

 

2.     Uttar Pradesh: With a projected GSDP of Rs. 24,99,076 crore and a growth rate of 5.8% over 2023-24, Uttar Pradesh's budget prioritizes welfare initiatives and infrastructure development. Notable allocations include Rs. 4073 crore for the welfare of widows and Rs. 4,000 crore for the Swami Vivekananda Youth Empowerment Scheme, aimed at distributing smartphones and tablets. The state also inked a Rs. 4,000 crore MoU with Hero Future Energies for investments in clean technology and renewable energy. Furthermore, Rs. 3,000 crore has been earmarked for urban expansion and new city initiatives.

 

3.     Gujarat: Presenting the budget for 2024-25 on February 2, Finance Minister Kanubhai Desai outlined Gujarat's ambitious growth trajectory, projecting a GSDP of Rs. 27.9 lakh crore—a growth of 13.3% over 2023-24. Key policy highlights include the Namo Laxmi Scheme, offering scholarships to girls in secondary and higher secondary schools, and the Namo Saraswati Scheme, providing financial assistance to science stream students. Additionally, investments in education and healthcare include schemes like Anganwadi, aimed at building 8,000 new centers and providing IT connectivity to 20,000 existing ones.

 

4.     West Bengal: Finance Minister Chandrima Bhattacharya unveiled West Bengal's budget for 2024-25 on February 8th, projecting a GSDP of Rs. 18.8 lakh crore—a growth of 10.5% over the previous fiscal year. The budget prioritizes social welfare, with increased financial assistance under various schemes for women and the elderly. Notable initiatives include raising financial assistance for women from SC/ST communities and providing at least 50 days of work to MGNREGA job card holders.

 

The significance of economic performance as a cornerstone of political discourse cannot be overstated. The progress of each state’s economic growth, as reflected in their GDP contributions and budgetary priorities not only mirrors their developmental journey but highlights the varying challenges and opportunities across the nation.

 

While states like Uttar Pradesh are exemplars of advancement, symbolizing the potential for transformative change through focused policies and investments, others like Bihar serve as a poignant reminder of the persistent hurdles hindering equitable development.

 

As political parties gear up to woo voters with promises of prosperity and progress, it is imperative that the discourse transcends mere rhetoric and probes into substantive strategies for inclusive growth, job creation and sustainable development.