Abstract

Changes in the Structure of Telangana Economy: An Analysis of Sectoral Shares in GSDP and Employment

Dr M A Malik

Volume: 12 Issue: 3 2022

Abstract:

Telangana became a separate state on 2 June 2014, making 2014–15 an important reference year for examining its subsequent structural transformation. This study analyses changes in the structure of the Telangana economy between 2014–15 and 2021–22 by examining two dimensions of structural change: the contribution of agriculture and allied activities, industry, and services to Gross State Value Added (GSVA), and the distribution of workers across primary, secondary and tertiary activities. The evidence is drawn mainly from the Telangana Socio Economic Outlook 2022, Directorate of Economics and Statistics publications, and Periodic Labour Force Survey (PLFS) reports of the Ministry of Statistics and Programme Implementation. At current prices, the services sector remained the dominant component of the state economy, with its share of GSVA at about 61.3 per cent in 2021–22 compared with 61.3 per cent in 2014–15. Agriculture and allied activities increased their share from 16.3 per cent to 18.3 per cent, while industry declined from 22.4 per cent to 20.4 per cent. The employment structure, however, presents a different picture. By 2021–22, primary-sector employment had risen to 50.84 per cent, secondary employment was 20.47 per cent and tertiary employment was 28.67 per cent. Thus, Telangana displayed a pronounced output–employment mismatch: services generated the largest share of value added, while agriculture and allied activities absorbed the largest share of workers. The study argues that the period witnessed a service-led and relatively capital/productivity-intensive structural transformation rather than a conventional agriculture-to-industry-to-services sequence. The COVID-19 shock also temporarily pushed labour towards agriculture and reduced the employment share of services. The article concludes that future structural transformation should focus on raising agricultural productivity, expanding labour-intensive manufacturing, strengthening distributed service-sector employment and improving the quality of jobs.

DOI: http://doi.org/10.37648/ijrssh.v12i03.037

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