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HomeEconomy‘Bhagirath-like effort needed’ as Yogi 2.0 revives trillion-dollar economy dream for UP

‘Bhagirath-like effort needed’ as Yogi 2.0 revives trillion-dollar economy dream for UP

To hit this target, UP’s growth would need to increase four-fold in the next 5 years, considering the govt's advance estimates of GSDP for 2021-22 stand at $254 billion.

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Lucknow: Fresh after victory in the Uttar Pradesh assembly elections, and even before the new cabinet is formed, the Yogi Adityanath-led BJP government has given a push to its plan to make the state a trillion-dollar economy in five years.

The state has invited bids for the appointment of a consultant to formulate a roadmap to achieve the target, considering that it would need boosting the UP economy by nearly five times. Experts say this will require a “Bhagirath Prayas”, the Hindu mythological equivalent of a Herculean/superhuman effort, by which Bhagirath brought the river Ganga from the heavens to the Earth.

The UP government released a Request for Proposal (RFP) document for bidders Tuesday.

“Interested bidders can submit their e-bids on e-tender portal till 14 April, and the pre-bid meeting is scheduled for 22 March,” a UP government official told ThePrint. The technical bids will open on 18 April.

The idea that UP should aim to become a trillion-dollar economy was first floated by PM Narendra Modi at UP Investors’ Summit 2018. “Can Maharashtra and Uttar Pradesh compete with each other to become a trillion-dollar economy? Will UP government compete with other states? More the competition, more will be the investment,” the PM had said.

While the process to appoint a consultant was first initiated in June 2020 under Yogi Adityanath’s first government, the appointment could not be completed, and the period since then witnessed the process of issuance of RFP, its revision, floating of bids, their amendment and subsequent cancellation. There were concerns that the 2020-2025 timeline to make UP a trillion-dollar economy may be revised too.

The state government is now planning to meet its target in the next five years, that is, by 2027.

The fact that the trillion-dollar economy plan is very ambitious and will require raising UP’s current growth rate exponentially has not escaped officials and experts.

The RFP floated for bidders states: “… in 2018-19, the gross state domestic product (GSDP) has already touched Rs 15.80 lakh crore ($230 billion) with a rich growth rate of 7 per cent over the previous year. However, it would be a challenging task to boost the size of the GSDP by nearly five times to reach the target of one trillion dollars in five years (2022-27), discounting for dollar fluctuations and global trends. It enhances the challenge and would require sustained and aggressive efforts at the state level.”


Also Read: Yogi Adityanath — ‘curious boy’ who became firebrand leader makes history with 2nd term as UP CM


‘Stable govt, better prospects’

UP contributes 8 per cent to the national GDP — as stated in the RPF — and the new target demands some giant steps to be taken by the state government.

Experts point to the difficulties, considering that UP government’s advance estimates of GSDP for 2021-22 stand at $254 billion.

“Earlier too, an RFP was issued by the UP government in the previous regime. They have now come out in with a new proposal and revised the timeline to 2022-2027. I feel that now UP has better prospects of economic growth because a stable government is likely to attract more investment if there are no external shocks like Covid,” Dr Yashvir Tyagi, former head of the economics department at Lucknow University, told ThePrint.

“Brand UP has also improved as the government has launched massive infrastructure projects like expressways, metros and airports, so the state is likely to attract more foreign and domestic investment. However, it is still a Herculean task, as the RPF document itself states, considering the current GSDP,” he said.

Tyagi explained that it was an uphill struggle as it would require more than 30 per cent growth per annum in nominal terms to achieve the target — which would be a “Bhagirath Prayas” for Adityanath.

“According to data from the Directorate of Economic and Statistics of the UP government, the advance estimates for GSDP for 2021-22 stand at Rs 19.10 lakh crore. If you translate it in dollars, even if you take a conservative value of Rs 75 to a dollar, the size will be $254 billion and you have to take this to $1,000 billion, that is four times, in the next five years,” Tyagi said.

“Further, the rupee is depreciating and in such a scenario, a higher growth rate is required to achieve this target. Let’s see if Yogi Adityanath becomes a modern-day Bhagirath by transforming UP into a trillion-dollar economy,” he added.

The RFP notes that “along with some well-thought and long-term strategies on a sustained basis, the Herculean task demands some giant steps to be taken by the state government to move forward”.

“This would also require organisational restructuring, focused policies and rules for more effective governance, faster decision-making process and improved accountability. Compare the structural, institutional, financial, and governance reforms carried out and outcomes achieved in top three states of India and top three countries across the globe, with similarities to UP,” it adds.

(Edited by Nida Fatima Siddiqui)


Also Read: With heft of victory in UP, Yogi Adityanath can now begin to assert himself at BJP high table


 

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