Bengaluru: According to the economic survey released by the government on Friday March 4, the State economy is on path of economic growth by 18.4 per cent in the current fiscal year. It is the highest in the last five years and the first GSDP growth of more than 10 per cent since the Covid – 19 pandemic years.
According to the estimates presented in the economic survey, the state’s GSDP will reach Rs. 20.49 lakh Crore in 2021-22, a significant increase from the Rs. 17.31 lakh Crore recorded in 2020-21. The services sector, which is the backbone of the state economy, has contributed the most to the increase in GSDP, with a 15 per cent rise from Rs. 10.40 lakh crore to Rs. 12.06 lakh crore. The two other key sectors contributing to the Karnataka economy, agriculture and industry, have been sluggish.
Despite the impact of the Covid – 19 pandemic on the entire state economy, the State has rallied towards the end of FY21 and continues to do so through FY22,” stated the survey.
The survey also stated that Karnataka is among the top five states in India and has demonstrated strong growth over the years. It’s per capita GSDP of INR 3.05 lakh (estimated for FY22) is the highest among the top five states. “A stand out feature of the State economy is it has the highest share of services in the Gross State Value Added of 66.1 per cent in FY22 (estimates) – the highest among all states, a product of its robust IT services industry and other technology-driven areas,” it added.
The last time Karnataka recorded a year-on-year GSDP growth of more than 15 per cent was in 2016-17, when it increased by 15.5 per cent.
“Due to the Covid pandemic, which has caused in a slowdown in the economy, the State has had to face a lot of obstacles during the last two years. The economy appears to be rebounding, as seen by the revenue collection figures for 2021-22,” said Chief Minister Basavaraj Bommai in his budget speech.
The economic survey states that Indian software exports in the current financial year are estimated to be worth $170 billion USD with Karnataka contributing an estimated 38 per cent. “More than 21 lakh people are employed in the software industry with high-paying jobs centred mostly in Bengaluru city. Further, the state has more than 40 unicorns (companies with valuation of more than $1 USD billion) — 42 per cent of India’s total of 95 unicorns. It has 13,000 plus start-ups. Karnataka received more than $16 USD billion in FDI in the pandemic struck FY21 signifying the potential of its technology-based growth engines,” it added.