Growth Determinants of Orissa and their Implications for Future Development of the State

Orissa presents a paradoxical picture of poverty amidst plenty. Despite being endowed with vast natural resources such as long coastal line, fertile green coastal plains, rivers, forest resources, and mineral resources such as iron ore, bauxite ore, limestone, the state continues to be a backward state. A comparative analysis of interstate poverty ratio shows that 47.2 per cent of the state’s population lives below the poverty line in 2001-02, which is the highest in India (all India average being 26.1 per cent). Even in terms of human development index (HDI), the state lags behind many other states. As per the National Human Development Report (2001), it secures 11th rank among the major fifteen states. To add to the problems of the poorer sections of population, the state is not only frequently marred by natural calamities like flood, drought, and cyclone, but also has experienced distorted growth trends both in industry and agriculture. In our earlier study, it was shown that both agriculture and industry had undergone negative growth rate during the 1990s (Rath and Jena, 2003). While the coastal area suffers from the ravages of flood and cyclone, the western part of the state is subjected to the vagaries of drought conditions, which further widens the regional disparities. Therefore, the matters of concern for the state economy are: how to abate poverty, and how to accelerate its growth process, so that it can rank on par with other major states. In order to accelerate the growth process, the issues that need investigation are: why did agriculture attain negative growth rate during the Ninth Plan period, why was industry growth rate stagnant, and can the emerging tertiary sector reduce pressure of employment in the agriculture sector? However, among all these issues, in this paper we have examined the various facets dealing with the negative growth rate of the agriculture sector. With a view to suggest some remedial measures for the declining agriculture sector, an attempt is made to identify the drivers of the sector.