Inflation rises, GSDP expected to grow at 7.06%: Economic Survey

The Economic Survey Report, tabled in the Jammu and Kashmir Assembly on Thursday, revealed a slight rise in inflation while projecting strong economic growth for the upcoming fiscal year. The report stated that inflation in J&K increased to 4.5 per cent in 2024 from 4.3 per cent in 2023, reflecting a 0.2 per cent rise. In contrast, all-India inflation declined from 5.7 per cent to 5 per cent during the same period. Over the last five years (2019-2024), inflation in J&K has fluctuated between 3.8 per cent and 4.5 per cent, compared to the national range of 3.7 per cent to 5 per cent.

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Despite the inflationary trend, the report projected a strong economic performance, with the Gross State Domestic Product (GSDP) expected to grow at 7.06 per cent in 2024-25. The nominal GSDP is estimated to rise by 11.19 per cent, reaching Rs 2.65 lakh crore, while the real GSDP is projected at Rs 1.45 lakh crore. The report highlighted a compound annual growth rate (CAGR) of 4.89 per cent in real GSDP from 2019-20 to 2024-25, surpassing the 4.81 per cent growth recorded between 2011-12 and 2019-20.

What report says

• As per the report, J&K is actively contributing to the national GDP (0.8%) in proportion to its population (0.98%)
• The primary, secondary, and tertiary sectors are expected to contribute 20%, 18.30%, and 61.70%, respectively, to the Gross State Value Added
• The report stated that a revenue of Rs 15,737.80 crore was realised in the first nine months of the financial year 2024-25, which is 77% of the Rs 20,333.55 crore revenue realised in 2023-24
• The contribution of non-tax revenue to total revenue increased to 32% in FY25, the report said and pointed out that the share of power tariffs in non-tax revenue grew from 56% to 67%

Business rules framed, sent to L-G for nod: CM

• The government has finalised its business rules and sent them to Lt Governor Manoj Sinha for approval, Chief Minister Omar Abdullah informed the Legislative Assembly
• During his reply to the motion of thanks on the L-G’s address, Abdullah stated that the cabinet had discussed and approved the rules in a meeting held at 8 pm on Wednesday. He emphasised that while his government is in favour of restoring statehood, establishing clear business rules in the meantime is essential for efficient governance
• “It took some time, but yesterday at 8 pm, we convened a cabinet meeting and finalised the business rules. They were approved by our cabinet and have now been submitted to the Lt Governor for approval,” Abdullah said
• The CM expressed hope that the Lt Governor would grant approval soon, as the move aims to eliminate confusion in government functioning

The industrial sector has also witnessed significant reforms with the rollout of new policies, including the J&K Start-Up Policy 2024-27, the revised J&K Industrial Land Allotment Policy 2021-30 (Amended 2024), and the updated J&K Private Industrial Estate Development Policy 2021-30 (Amended 2024).

The report highlighted a 57 per cent increase in investment realisation, amounting to Rs 3,389.37 crore in 2023-24. Furthermore, 334 industrial units became operational in FY 2024-25 (up to December 2024), employing 8,443 people with an investment of Rs 2,977 crore. Since 2019, 1,984 industrial units have started operations, bringing in an investment of Rs 9,606.46 crore and generating 63,710 jobs until December 2024.

On the health front, J&K recorded a major improvement in the sex ratio at birth, which rose from 923 to 976. The life expectancy at birth in the UT has reached 74.3 years, making it the highest in India after Kerala and Delhi.

The report also pointed to a decline in the unemployment rate, which fell from 6.7 per cent in 2019-20 to 6.1 per cent in 2023-24. This improvement was reflected in the Labour Force Participation Rate (LFPR) and Worker Population Ratio (WPR), which rose to 64.3 per cent and 60.4 per cent, respectively, signalling better employment opportunities in the region.

J&K’s agriculture sector is undergoing a transformation, shifting toward high-value crops, organic vegetables and exotic varieties. The government has launched the Holistic Agriculture Development Plan, with an investment of Rs 5,013 crore in 29 projects over five years. This initiative is expected to add Rs 28,000 crore to the GSDP, create 2.88 lakh sustainable jobs, benefit 13 lakh families and train 2.5 lakh youth through 19,000 new enterprises.

The report also noted major legal changes following the abrogation of Article 370, with over 890 central laws extended to J&K. Additionally, 205 state laws have been repealed and 130 modified to align with national standards, including the implementation of progressive legislation such as the Right to Education and the Child Marriage Act, benefiting Valmiki, Dalit and Gorkha communities.

The tourism sector witnessed record-breaking footfall, with 2.36 crore tourist arrivals in 2024, including 65,000 foreign tourists, marking an all-time high for the region.

With robust economic growth, increased investment, improved employment rates and record tourism, the Economic Survey 2024 paints a promising picture for Jammu and Kashmir, despite inflationary concerns.