Creating false narratives against the Modi and Maharashtra Governments has become a common practice. Fake narratives about national and state economies are on the rise. The economic data are presented in such a way that the nation and state are about to collapse, which is completely false. The national and state economies are significantly stronger than they were during the Congress era. Regarding Maharashtra, one thing everyone should understand is that Devendra Fadanvis, whether you like him or not because of his caste, must realise that during his stint as CM and now as Deputy CM, he ensured that the economy grew on all fronts, including FDI, GSDP, and so on. Another false narrative about industries moving to Gujarat and leaving Maharashtra; simple statistics on domestic investment and FDI clearly demonstrate that Maharashtra is well ahead of Gujarat.
Maharashtra’s Economy
At current rates, Maharashtra’s GDP is expected to be Rs 38.79 trillion (US dollar 465.76 billion) in 2023-24. The state’s GSDP expanded at a 5.88 per cent CAGR (in US dollars) between 2015-16 and 2023-24. Mumbai, the state capital, is India’s commercial centre and has emerged as a global financial powerhouse. The city is home to a number of worldwide banking and financial service businesses. Pune, another significant city in the state, has developed as an educational hotspot. According to the Department for Promotion of Industry and Internal Trade (DPIIT), FDI inflows into Maharashtra totalled US dollar 202.41 billion from October 2019 to March 2024. Maharashtra received the most foreign direct investment (FDI). In fiscal year 24, the state’s total exports were 67.20 billion dollars. Engineering goods, pearls, precious and semi-precious stones, gold and other precious metal jewellery, medicinal formulations, and electronic goods were among the top exports from Maharashtra.
Maharashtra has evolved as a vital location for the IT & ITeS, electronics, and captive business outsourcing sectors. The state has a robust social, physical, and industrial infrastructure. Aside from sixteen airports, the state features two major and 48 minor ports. It also has a well-developed power supply network. Maharashtra’s infrastructure sector has risen dramatically over the previous decade, owing primarily to the BJP and coalition, with a large increase in the number of industrial clusters and public-private partnership (PPP) projects. Pune is India’s largest car hub, with approximately 4,000 manufacturing facilities in the Pimpri-Chinchwad region alone. Pune is home to major businesses such as Bajaj Auto Limited, Daimler Chrysler Limited, and Tata Motors, while Nasik is home to one of India’s leading multi-utility vehicle manufacturers, Mahindra & Mahindra Limited.
The total debt of the Maharashtra Government is estimated to be around Rs 7.82 lakh crore in 2024-25, which is 18.35 per cent of the state’s Gross State Domestic Product (GSDP).
The fiscal deficit is estimated to be 2.6 per cent of GSDP or Rs 1,10,355 crore.
The revenue deficit is estimated to be 0.5 per cent of GSDP or Rs 20,051 crore.
The expenditure (excluding debt repayment) is estimated to be Rs 6,12,293 crore.
The receipts (excluding borrowings) are estimated to be Rs 5,01,938 crore.
Understanding the concept of Debt
Not all debt is bad, including personal debt. For example, someone may have a home loan debt of Rs 50 lakhs, but in return, they have an asset of their own home and may live peacefully. While personal debt is usually negative, organisations and nations incur debt in order to support their development.
It is good to have a young tree and a large debt because your apple supply will grow. It is terrible to have a huge debt with a mature tree because your earnings will not improve significantly (example: Italy). It is exceedingly undesirable to have a dying tree and not have planted a new one when you have a large loan (for example, Japan). Singapore has some of the highest ratings in the world, despite its high GDP debt ratio (more than 100 per cent). This is because what matters is what you do with the borrowed money. Singapore borrows money and invests it in creating assets, hence increasing the value of debt. This is simple economics. As a result, they are able to repay the debt and interest while also profiting from it. That is what the Maharashtra Government is doing: it is using debt to build infrastructure, hence increasing the value of debt. Maharashtra has room to take on additional debt, which is a positive thing. A growing economy requires a greater quantity of debt to fund large-scale investments.
Providing economic support to sisters and mothers will not have an impact on the economy; rather, it will help to enhance the rural economy in the long run since the money will be used to purchase commodities and improve the lifestyle. Providing assistance to farmers for indigenous cows can help farmers improve their economics, hence increasing the production of cows and farming. Any such assistance provided by the Mahayuti Government will have no effect on the economy but will add value to it because a growing economy, particularly in rural areas, benefits the whole economy.
Magnetic Maharashtra Initiative
The Government signed a memorandum of understanding (MoUs) worth Rs 61,000 crore (US dollar 8.33 billion) with 25 Indian companies in more than 15 sectors. It is estimated that the MoU is likely to create 2.53 lakh jobs across the state.
Textile Policy of Maharashtra, 2018-23
Encourage setting up of Fiber to Fashion value chain Generate 10 lakh new employments in the textile sector.
Rural initiative
Rural growth through tourism, accessibility of agricultural production markets, promotion of agricultural partnerships and provision of job opportunities for women and young people in rural areas.
Maharashtra is the largest producer of sugarcane and is the most industrialised state in India. It has maintained the leading position in the country’s industrial sector.
The BJP Government of Maharashtra has several policies in place to set up the right kind of business climate in the state. These policies aim to motivate investors to invest in various sectors of the state, thereby contributing to the overall development of the economy.
The following are some of the major initiatives taken by the Government to promote Maharashtra as an investment destination:
In January 2024, Prime Minister Narendra Modi inaugurated and laid the foundation stone for various development projects valued at over Rs 12,700 crore (US dollar 1.52 billion) in Navi Mumbai, Maharashtra.
An additional international airport was proposed at Navi Mumbai through a public-private partnership in four phases with an estimated cost of Rs. 14,179 crore (US dollar 1.95 billion) for Phase I to reduce air traffic congestion at Chhatrapati Shivaji Maharaj International Airport, Mumbai. It is one of the largest greenfield airports planned to handle a minimum of 6 crore passengers and 15 lakh MT of freight per annum.
As of September 2023, the state had a total installed power generation capacity of 46,137.87 MW, of which the private sector was the largest contributor with a capacity of 24,553.6 MW, followed by 13,450.97 MW from state utilities and 8,133.30 MW from central utilities. Thermal power contributed 28,766.97 MW to the total installed power generation capacity, followed by renewable power, hydropower and nuclear power at 13,159.73 MW, 3,331.84 MW and 879.33 MW, respectively.
The BJP Government of Maharashtra is promoting the development of several Special Economic Zones (SEZs) across Maharashtra for sectors such as IT/ITeS, pharmaceuticals, biotechnology, textile, automotive and auto components, gems and jewellery, and food processing.
Maharashtra BJP Government has set an aspirational target of dollar 1 Tn GDP by FY28 for which Maharashtra will accelerate and grow at ~14-15 per cent annually. Maharashtra will ensure that the growth is sustainable, and balanced across all regions.
Maharashtra had 12 SEZs with valid in-principle approvals, 51 SEZs with formal approvals and 45 SEZs with notified approvals. The double-engine Government excels in all aspects of social and economic development.
