COMPARISON OF 11TH AND 12TH FYP ON THE BASIS OF INCOME

11TH FIVE YEAR PLAN

Target growth in GDP 9% scaled down target 8.1% Actual achieved 8%

The fact that this growth occurred in a period which saw two global crises, one in 2008 and another
in 2011, is indicative of the resilience which the economy has developed.

The rate of growth of real consumption per capita in rural areas in the period 2004–05 to 2011–12
was 3.4 per cent per year which was four times the rate in the previous period 1993–94 to 2004–05

Rural real wages increased 6.8 per cent per year in the Eleventh Plan (2007–08 to 2011–12)
compared to an average 1.1 per cent per year in the previous decade, led largely by the
government’s rural policies and initiatives.

12th FIVE YEAR PLAN

Targeted Real GDP Growth Rate of 8 per cent.

Expected to be scaled down to 7%

2012-13 growth rate - 5%; Expected growth rate 2013-14 - 6.1% - 6.7%

So economy will need 9.7% p.a growth rate for the remaining time period to achieve 8% overall rate,
which is impractical. If the rate is revised to 7% then an 8% growth p.a. for the rest of the plan period
would ensure the achievement of targeted growth rate of the plan.

July 27, 2013

Montek Singh Ahluwalia has warned that India's economic growth could slip below 5% for the
remainder of the 12th Plan period because of diminishing political space for reforms .

Disparity in PCI (Per Capita NSDP) at 2004–05 Prices

2011–12 Bihar 15,268; Maharashtra 64,951; Ratio Lowest To Highest PCI = 0.24

Ratio of Per Capita GDDP in Richest District to Poorest District

Haryana 9.87 (2005–06); Bihar 8.65 (2004–05); UP 9.20 (2005–06); Punjab 1.59 (2005–06)

Recent studies for growth in incomes since 1999 to recent periods (for which data are available)
indicate interesting trends in the States of Bihar, Karnataka, West Bengal, Haryana, Jharkhand and
Kerala; the relationship is upward sloping. This suggests divergence in growth performance across
districts, that is, districts which were richer to begin with grew faster, suggesting that inequality
between districts in these States was increasing. Each of these States witnessed very high growth
rates in the first decade of the 21st century, and the fact that they also observed rising intra-State
disparities indicates that growth was concentrated in a few pockets. This, in turn, may have
contributed to overall inequality in the State, which explains why States such as Bihar did not
perform well in terms of poverty reduction despite recording impressive growth rates.