Economy of Andhra Pradesh

GSDP

In 2014–15, the state ranked eighth in GSDP at current prices, which stood at ₹5,200.3 billion (US$77 billion). It recorded 12.03% growth compared to previous fiscal which was ₹4,641.84 billion (US$69 billion). While, at constant prices, the GSDP of the state for 2014–15 was ₹2,645.21 billion (US$39 billion), compare to ₹2,467.24 billion (US$37 billion) of 2013–14.

In 2012-13, the Gross State Domestic Product (GSDP) of Andhra Pradesh at constant prices stood at ₹2,359.3 billion (US$35 billion) and the Gross State Domestic Product at current prices for the same fiscal year stood at ₹4,193.91 billion (US$62 billion). The per capita income of the state increased by 6.26% from ₹25,959 (US$390) (2004–05) to ₹42,186 (US$630) (2012-13).

This is a chart of trend of gross state domestic product of Andhra Pradesh at market prices by Ministry of Statistics and Programme Implementation with figures in billions of Indian rupees.

Source: GSDP (current prices)

Per capita income

The per capita income figure gives a better idea of the standard of living of the people. In 2014–15, the state is ranked eighteenth with 90517 in terms of GDP per capita at current prices. It recorded a growth of 11.20% compared to previous fiscal which was 81,397.

Agriculture and aquaculture

Agriculture has been the chief source of income and main occupation for the state with 60% of population engaged in agriculture and related activities. Rice is the major food crop and staple food of the state. Other important crops are sugarcane, cotton, mango, tobacco, Maize, pulses etc. Four important rivers of India, the Godavari, Krishna, Penna, and Tungabhadra flow through the state, providing irrigation. Recently, crops used for vegetable oil production such as sunflower and peanuts have gained favour. There are many multi-state irrigation projects in development, including Godavari River Basin Irrigation Projects and Nagarjuna Sagar Dam.

Andhra Pradesh was among the very few states in the country which went in for the Green Revolution in rice cultivation in the 1970s. Average per capita agricultural income in the state was ₹54.599 billion (US$810 million) at constant prices (2012–13).

Aquaculture

Aquaculture such as cultivating fish, crustaceans, molluscs, Shrimp production etc., are the major occupations of coastal areas. Andhra Pradesh is the largest producer of shrimp in the country, with 70% of the production from the state itself. The geographical location of the state allows marine fishing as well as inland fish production. Cyclones may do less damage to aquaculture than to crop production. Hence, farmers are getting attracted towards this industry. It grew from ₹3.46 billion (US$51 million) to ₹5.61 billion (US$83 million). The Waterbase Limited is an aquaculture unit located at Nellore, it encourages scientific shrimp farming. Most exported marine exports include Vannamei shrimp.

Industries

The domestic product of Industrial sector accounts for ₹507.45 billion (US$7.5 billion). The state has also started to focus on the fields of information technology and biotechnology. Several major industries are in operation in Visakhapatnam. Automobiles and Auto components Industry, spices, mines and minerals, Textiles and apparels, IT industry, Bulk drugs and pharmaceuticals, horticulture, poultry farming are the main industries in Andhra Pradesh.

Industrial estates

As of June 2013, the state had 39 operational special economic zones (SEZs). There are 272 Industrial estates and industrial development areas in the State, covering an area of 14700 hectares. The State Government is in the process of developing Industrial Parks at different places, for specific groups of industries like Visakhaatnam Export Processing Zone.

Food parks, one each in the 2 regions of Coastal Andhra (value added rice products, dairy, horticultural, marine etc.); and in Rayalseema region (processing of vegetables, edible oils and export oriented industry). Agri Export Zones for the following produce are proposed at the places mentioned against them:

Infrastructure

The State is well connected by road, rail, air and sea. Visakhapatnam is a major port in the State. Vijayawada, Tirupati and Visakhapatnam are air-linked. National and international flights link the state with important world locations.

Hydel and thermal power projects in the state meets the power requirements of the State. Number of new power projects are coming up in the State which is expected to generate additional power capacity in the State.

Transportation

AP has been one of the first States to encourage private sector participation in infrastructure development. The state has a total length of over 146,954 km (91,313 mi) of road network, including national and state highways, district and rural roads. Development of high density corridors on major routes is being undertaken with private participation.

Andhra Pradesh has an International airport at Visakhapatnam. The state also has domestic airports at Vijayawada, Rajahmundry, Tirupati and Kadapa.

Andhra Pradesh has the biggest seaport at Visakhapatnam, with feeder services to Europe, Russia, USA and the Asia Pacific. Berthing of vessels is available up to 50000 DWT. The cargo handling at Visakhapatnam port during July 2002 – June 2003 was 45.5 million tonnes (14.6% of All India), making it the busiest port in the entire country, ahead of Kandla, Chennai, Haldia and Mumbai. Gangavaram Port is a private deep sea port, located in Visakhapatnam has a depth of 21m. Krishnapatnam Port and Kakinada port are privately built and owned deep water ports.

Communication

The latest available statistics (as in 2001) show that there were 3003 Telephone exchanges, 3140948 telephone connections, 118 telegraph offices (excluding extension counters, telecom centres, and combined offices) and 78218 public telephones. As at December 2003, it is estimated that there are 1550,000 cell phone subscribers in the State. The State has a share of 7% in All India cell phone subscribers.

Exports

Tentative estimates reveal that the total exports from AP during the year 2003–04 were to the tune of Rs.15,306 crore. The share of software was 30%, and that of food products was 20%. The value of exports during 2002–03 was Rs.13,614 crore and that during 2001–02 was Rs.12,400 crore.

Tourism

The state provides a budget for tourism, financially supporting various projects. The state has helped develop religious tourism via the State Tourism Department (APTDC). Some of the famous destinations are Tirumala, Srisailam, Sri Kalahasti, etc. Tirupathi is one of the major source of income in the tourism segment because of the abode of Sri Venkateswara (Lord Balaji). The temple is one of the richest in the world in terms of donations received. Other important sources of income come from the developing tourism centres at Visakhapatnam, Vijayawada.

Economic changes during 1954–1983

This can be called the 29-year era of 12 centrally nominated chief ministers List of Chief Ministers of Andhra Pradesh. Excluding Kasu Brahmananda Reddy term (7 years), average tenure of a chief minister was less than two years. The cumulative growth during this 30-year period for Indian economy is 311%, and for Andhra Pradesh it was 138%.

Economic changes during the 1980s

This can be called the N. T. Rama Rao Era (1983–1989).An academic study of Andhra's economic activity using official data collected by the state government of Andhra Pradesh, Govt of India and World Bank reveal the following highlights.

1. A Domestic Demand – Supply based economic policy instead of exports oriented policies during this pre-liberalization period resulted in Constant Currency (inflation adjusted) cumulative growth rates of 151% in seven years, one and half times higher than the cumulative growth rate of the 30 years earlier, and 25% higher than the cumulative growth rates of 20 years that followed.
2. Education reforms, local government empowerment, irrigation and electricity improvements, corruption controls of this period resulted in cumulative per capita income growth rates (corrected to inflation and population growth) ten times the growth rates for the first 30 years and three times the rates of the 20 years that followed. On average a typical Andhra resident was 3000% more productive in improving his/her economic condition than in the 30 years earlier and 450% more productive than the 20 years that followed.
3. Distributional and social indicators (rural education 51%, child labor (−60%), malnutrition (−81%), infant mortality (−37%), female education (77%)) improved at rates that are yet to be repeated.
4. Fiscal Management Indices (deficit,foreign debt, debt servicing levels etc.) were at their best levels compared to the era the followed when central government allowed higher deficit targets and allowed foreign borrowing directly from world bank as a part of the liberalisation regime.