ECONOMICS RESEARCH PAPER

STRUCTURE OF ECONOMY OF SOUTHERN STATES

OF INDIA

Project Submitted to:

Prof. Hanumant Yadav

(FACULTY OF ECONOMICS)

Submitted By:

Gourab Kumar Agarwal

B.A. LLB (HONOURS)

Semester: II
Section: A
Roll No: 67
Date of Submission: 15th February 2016

HIDAYATULLAH NATIONAL LAW UNIVERSITY

RAIPUR, CHHATTISGARH
 DECLARATION

I, Gourab Kumar Agarwal, hereby declare that, this project report entitled, Structure
of Economy of Southern States of India submitted to Hidayatullah National Law Univers ity,
Raipur is record of an original work done by me under the guidance of Prof. Hanumant Yadav,
Faculty Member, H.N.L.U., Raipur and that no part of this work has been plagiarized without
citations.

Gourab Kumar Agarwal

Semester II

Section - A

Roll no 67

15/02/2016
 ACKNOWLEDGMENTS

I, Gourab Kumar Agarwal, would like to present humbly this project to Prof. Hanumant
Yadav. I would, first of all, like to express my most sincere gratitude to Prof. Hanumant Yadav
for his encouragement and guidance regarding several aspects of this project. I am thankful for
being given the opportunity of doing a project on Structure of Economy of Southern States
of India.

I am grateful to the library staff as well as the IT lab staff for all the conveniences they
have provided me with, which have played a significant role in the completion of this paper.

I would like to thank God for keeping me in good health and senses to complete this
project.

Last but not the least; I am thankful to my seniors for all their support, tips and valuab le
advice whenever needed. I present this project with a humble heart.

Gourab Kumar Agarwal

Semester: II
Section: A
Roll No. 67
B.A. LLB (HONOURS)
 CONTENTS

INTRODUCTION ..............................................................................................1
OBJECTIVES OF THE STUDY .........................................................................2
RESEARCH METHODOLOGY .........................................................................3
ECONOMY OF TAMIL NADU .........................................................................4
ECONOMY OF KERALA..................................................................................8
ECONOMY OF KARNATAKA ....................................................................... 12
ECONOMY OF ANDHRA PRADESH ............................................................. 17
ECONOMY OF TELANGANA ........................................................................ 21
CONCLUSION ................................................................................................ 23
REFERENCES ................................................................................................. 24
 INTRODUCTION

Economy of South India after independence in 1947 conformed to a socialist framework, with
strict governmental control over private sector participation, foreign trade and foreign direct
investment (FDI). Through 19601990, South Indian economies experienced mixed economic
growth. In the 1960s, Kerala achieved above average economic growth, while Andhra Pradesh's
economy declined during this period. Similarly, Kerala experienced economic decline in the 1970s
while the economies of Tamil Nadu, Andhra Pradesh and Karnataka consistently exceeded
national average growth rates after 1970. Andhra Pradesh, Tamil Nadu and Karnataka were noted
by some to be more reform-oriented in terms of economic policy when compared to other Indian
states. Over the last decade South India has grown at 8% annually. Future economic growth will
be shackled by relatively low proportion of active age population to the number of dependents.

Over 48% of South India's population is engaged in agriculture, which is largely dependent on
seasonal monsoons. Some of the main crops cultivated in South India include paddy, sorghum,
pearl millet, pulses, sugarcane, cotton, chilli, and ragi. Areca, coffee, tea, vanilla, rubber, pepper,
tapioca, and cardamom are cultivated on the hills, while coconut grows in abundance in coastal
areas. Information Technology is a growing field in South India. Bangalore is India's Informa tio n
Technology hub, and is home to over 200 software companies. It is often referred to as the Silicon
Valley of India. Four of the country's top seven exporters of software viz. Bangalore, Chennai,
Hyderabad and Coimbatore are located in South India.

Chennai houses the automobile manufacturing giants in the country. More than 65% of heavy
vehicles produced in the country, such as cars, buses, lorries, trains and bicycles, are produced in
Chennai, and it is referred to as the Detroit of Asia. Coimbatore (also known as "Cotton City" and
"Manchester of South India") in Tamil Nadu is the source of nearly 35% of India's cotton
production. Erode and Tirupur are the largest producers of cotton vests and textiles in India; it
exports much of its production to South East Asian and European countries. Erode is also known
as the "Turmeric City", since it has the Asia's largest market for Turmeric. Gobichettipalayam is
one of the largest producers of White silk with the country's first automatic silk reeling unit
established here. Namakkal is one of the largest producers of poultry in the country.

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 OBJECTIVES OF THE STUDY

The objectives of the following research paper are as follows:

1. To understand the economy of southern states of India as a whole and then move to
particular states forming south India.

2. To understand the economy of Tamil Nadu and talk about its growth after independence.

3. To talk about the economy of Kerala with a special emphasis on the states alcohol
consumption and the growth brought about by the tourism sector.

4. To understand the economy of Karnataka and understand the boom in IT Sector of the
state.

5. To understand the economy of Andhra Pradesh with a special emphasis on its agriculture
sector.

6. To talk about the economy of the newly formed state of Telangana.

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 RESEARCH METHODOLOGY

Nature of research

This research work is descriptive and Analytical in nature. It describes the Economy of the South
Indian States. It also describes and analyses their growth patterns and how they earn their GDP.

Sources of data

This study is done with the help of secondary data. This secondary information has been obtained
from published sources such as books, journals, newspapers, official websites, governme nt
publications, etc.

Mode of citation

A uniform method of citation has been adopted and followed consistently throughout this paper.

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 ECONOMY OF TAMIL NADU

Tamil Nadu has the second largest economy in India with a GSDP of 9767 billion (US$140
billion) in 201415 when it grew at 14.34%, witnessing highest increase of debt (92%) among all
the states between 2010 and 2015. Per capita GDP of Tamil Nadu was $3,000 in the year 2014
15, the third highest in India. As the most industrialized state of India, Tamil Nadu is also the most
urbanized, accounting for 9.6% of the urban population while only comprising 6% of India's total
population according to the 2011 census. Services contributes to 45% of the economic activity in
the state, followed by manufacturing at 34% and agriculture at 21%. Government is the major
investor in the state with 51% of total investments, followed by private Indian investors at 29.9%
and foreign private investors at 14.9%. Tamil Nadu has a network of about 113 industrial parks
and estates offering developed plots with supporting infrastructure. It has been ranked first by the
Economic Freedom Rankings for the States of India.1

This is a chart of Gross State Domestic Product of Tamil Nadu at market price estimated 2 by
Ministry of Statistics and Program implementation with figures in millions of Indian Rupees.

YEAR GROSS STATE DOMESTIC PRODUCT

1980 80,810
1985 156,481
1990 313,390
2000 1,411,000
2005 1,945,280
2009 4,020,820
2010 4,640,090

1 Nikhila Gill,Nikhila Gill (6 October 2010). "TN still most economically free". Express India. Retrieved 14 th February
2016.
2 national accounts division: press release and statements. Government of India, retrieved February 14, 2016

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India is predominantly an agricultural country and the same applies to Tamil Nadu as well.
Agriculture is the primary occupation of about seventy percent of the rural population of Tamil
Nadu. Around 34% of the state's population resides in urban areas while the remaining population
resides in the rural areas. With change in science and technology, agricultural practices have
undergone radical improvement since independence. The change is visible not only in agricultura l
practices but also in the type of crop grown. In the recent few years secondary and tertiary sectors
have also grown in great proportion, thanks to the New Economic Policy of the Indian
government.3

The main food crops that are grown in Tamilnadu are Rice, pulses and oil seeds while the important
commercial crops of the state include sugarcane, tea, rubber, cotton, cashew and coconut. Multip le
cropping, use of new and better varieties of rice, sugar, cotton, and millet coupled with the use of
chemical fertilizers have tremendously increased the agricultural output of the state. Tamil Nadu
has a 1000 km long coastline with equatorial climate, permitting year round fishery and farming.
Fishing is also an important economic activity in Tamil Nadu. Opportunities in shrimp farming
and processing, Crab culture, Seaweed culture, etc. are on the upswing in the state.

At present, Tamil Nadu is one of the most industrialized states in India. Many factors have
combined together to make Tamil Nadu a leading industrial state. The state has a well-developed
network of roads, rail, air and major ports at Chennai and Tuticorin. Cotton ginning, spinning and
weaving are the traditional industries of Tamil Nadu. Other important and heavy industries of the
state are automobiles, diesel engines, motorcycles, sugar, fertilizers, cement, agricultura l
implements, iron and steel, chemicals, transformers and paper. Everything from railway coaches,
automobiles, tractors, battle-tanks, motorbikes and heavy vehicles are manufactured in Tamil
Nadu. The rail coach factory at Perambur is one of the largest in Asia while the heavy vehicles
factory, which produces tanks, is located at Avadi. The Chennai seaport is one of the most
important ports in India. Tamil Nadu is rich in metals and minerals like limestone, gypsum,
bauxite, salt, Mica, quartz, magnetite, lignite and iron ore.

Many heavy engineering and manufacturing-based industries are located in and around Chennai,
which is nicknamed as the "The Detroit of Asia". Global auto giants like Hyundai, Ford, BMW,

3 http://www.bharatonline.com/tamilnadu/travel -tips/economy.html

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Caterpillar and Mitsubishi as well as domestic heavyweights like MRF, Ashok Leyland, TI cycles
of India, Mahindra & Mahindra, Royal Enfield, TVS and TAFE Tractors have their manufactur ing
units around Chennai.

The traditional handicrafts industry also flourishes in Tamil Nadu. Notable among them are
handloom silk, leatherwork, metal icons, kalamkari (hand-painted fabric, using natural dyes),
brass, copper wares, bronze, palm leaf, carved wood and cane articles. Tamil Nadu is an important
exporter of coffee, spices, yarn, tea, tobacco, handicrafts, engineering goods and granite.

SERVICES

Tamil Nadu has 570 engineering colleges, the most of any state in India. Tamil Nadu has a network
of about 110 industrial parks and estates offering developed plots with supporting infrastructure.
Also, the state government is promoting other industrial parks like Rubber Park, Apparel Parks,
Floriculture parks, TICEL parks for Biotechnology, Siruseri IT Parks, and Agro Export zones
among others. Tamil Nadu has the largest number of Small and Medium Enterprises in India.

This is a chart of trend of software exports from Tamil Nadu published by electronic corporation
of Tamil Nadu with figures in millions of Indian Rupees. 4

YEAR SOFTWARE EXPORTS SOFTWARE COMPANIES

1995 370 34
2000 31,160 766
2005 141,150 1,427
2007-2008 284,900 -
2008-2009 366,800 -
2009-2010 367,660 -

Chennai is the second largest software exporter in India, next to Bangalore. India's largest IT park
is housed at Chennai. Software exports from Tamil Nadu during 200809 rose 29 per cent to touch
Rs 366.80 billion, involving a workforce of 280,000. Chennai is a hub for e-publishing, as there

4 Status of IT industry in Tamil Nadu ELCOT, retrieved February 14, 2016

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are 47 e-publishing units registered with the STPI in Chennai and 25 in Bangalore. Companies
such as HCL, Wipro, TCS, L&T, Satyam, Infosys, Cognizant Technology Solutions, Covansys,
Xansa, Verizon, iSoft, Electronic Data Systems, Bally and many others have offices in Chennai.
Infosys Technologies has set up India's largest software development centre to house 25,000
software professionals at an estimated investment of 12500 million (US$180 million) in Chennai.
India's largest IT park SIPCOT is housed at Siruseri Chennai, It has numerous IT companies
such as TCS, CTS, Syntel, Steria, Polaris, Patni, Hexaware etc. Chennai has been rated as the most
attractive city for offshoring services.

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 ECONOMY OF KERALA

Service Industry dominates the Kerala economy. Kerala leads many other Indian states and
territories in terms of per capita GDP (Rs. 74,620) and economic productivity, and Kerala's Human
Development Index is the best in India. According to the Global Hunger Index 2008, the severity
of hunger situation in Kerala is "serious", which is better than the grade "alarming" received by
many Indian states. Kerala's low GDP and productivity figures juxtaposed with higher
development figures than in most Indian states is often dubbed the "Kerala Phenomenon" or the
"Kerala Model" of development by economists, political scientists, and sociologists. This
phenomenon arises mainly from Kerala's land reforms, social upliftment of entire communities
and reforms introduced by the communist party which held the state for a long period of
time.5 Some describe Kerala's economy as a "democratic socialist welfare state". Some, such as
Financial Express, use the term "Money Order Economy". Kerala's economic progress is above
the national average, but relatively few major corporations and manufacturing plants are
headquartered in Kerala.

Around 3,000,000 Keralites are working abroad, mainly in Persian Gulf; to where migratio n
started with the Gulf Boom. The Kerala Economy is therefore largely dependent on remittances.
In 2012, the state was the highest receiver of overall remittances to India which stood at $66.13
billion (Rs. 3,42,884.05 crore), followed by Tamil Nadu, Punjab and Uttar Pradesh.6 S. Irudaya
Rajan describes the situation as "Remittances from global capitalism are carrying the whole Kerala
economy". Unemployment recently dropped from a large 19.1% in 2003 to 9.4% in 2007 and only
4.2% in 2011. Underemployment, low employability of youths, and a 13.5% female participatio n
rate are chronic issues. One concern is that Kerala government is running some of the highest
deficits in India.

http://www.sas.upenn.edu/polisci/sites/www.sas.upenn.edu.polisci/files/Singh.Kerala.World%20Development.pdf
6 NRIs beat FDI, keep the money coming Hindustan Times, October 8, 2012, retrieved on February 14, 2016

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This is a chart of trend of gross state domestic product of Kerala at market prices estimated by
Ministry of Statistics and Programme Implementation with figures in millions of Indian
Rupees.Kerala had recorded a growth rate of 6.49 per cent in 2013, which was above the national
average (4.04) and the second highest among South Indian States. The states growth rate was
above that of Karnataka (5.79 per cent) and Andhra Pradesh (5.97 per cent).

YEAR GROSS STATE DOMESTIC PRODUCT

1980 42,860
1985 75,200
1990 140,980
1995 387,620
2000 697,920
2005 1,025,080

The states debt was estimated at 29.53% of GDP in 2013.

AGRICULTURE

Kerala produces 97% of national output of pepper and accounts for 85% of the area under natural
rubber in the country. Coconut, tea, coffee, cashew, and spices including cardamom, vanilla,
cinnamon, and nutmeg comprise a critical agricultural sector. A key agricultural staple is rice,
with some six hundred varieties grown in Kerala's extensive paddy fields. Nevertheless, home
gardens comprise a significant portion of the agricultural sector. Related animal husbandry is also
important, and is touted by proponents as a means of alleviating rural poverty and unemployme nt
among women, the marginalized, and the landless. Feeding, milking, breeding, manageme nt,
health care, and concomitant micro-enterprises all provide work for around 3.2 million of Kerala's
5.5 million households.[citation needed] The state government seeks to promote such activity via
educational campaigns and the development of new cattle breeds such as Sunandini.

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ALCOHOL

The government enforces state monopoly over liquor sale in the state, after the state banned foreign
liquor shops, through the government owned Kerala State Beverages Corporation (KSBC). Every
year, liquor sales have been rising and the total sales of liquor and beer during 2010-11 fiscal year
was expected to be about Rs. 67 billion7 .

The government applies the highest state tax on liquor (around 120%). The total revenue from
taxes on liquor was Rs. 55.39 billion in 2009-10. Kerala has the highest per capita consumptio n,
over eight litres (1.76 gallons) per person per year, in the nation, overtaking traditionally hard-
drinking states like Punjab and Haryana. Rum and brandy are the preferred drinks in Kerala in a
country where whisky outsells every other liquor. Taxes on alcohol was a major source of revenue
for the state government, but of late, it has been showing a declining trend. Only 4.2% of revenues
for its annual budget come from liquor sales. Revenues from alcohol to the state's exchequer have
registered a 100% rise over the past four years.

TOURISM

Kerala is an established tourist destination for both Indians and non-Indians alike. Tourists mostly
visit the beaches at Kovalam, Cherai, Kappad, Muzhappilangad Beach and Varkala, the hill
stations of Munnar, Nelliampathi, Wayanad and Ponmudi, and national parks and wildlife
sanctuaries such as Periyar and Eravikulam National Park. The "backwaters" region an extensive
network of interlocking rivers, lakes, and canals that center on Alleppey, Kumarakom, and
Punnamada also see heavy tourist traffic. Examples of Keralite architecture, such as the
Padmanabhapuram Palace, Malik Deenar Mosque Kasaragod are also visited. Trivandrum has the
highest number of international and domestic tourist arrivals in Kerala. And the major city in kerala
known as Cochin, Other cities like Kozhikode (Land of Zamorins) and Alappuzha(called the
"Venice of the East") are also popular destinations. Tourism plays an important role in the state's
economy. Kerala is also a preferred destination for night dwellers and the nightlife districts in
Trivandrum City, Kovalam, Poovar, Varkkala and Fort Kochi are the major centres. Kovalam

7 BEVCO pockets Rs 600 Crore in December The Hindu, 5 January 2011, retrieved on February 14, 2016

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Beaches is ranked second in India after Goa in terms of the number of International visitors and in
terms of Western Music festivals.

With the rise of Technopark, Trivandrum City has witnesses a massive increase in the number of
pubs, clubs and bars and now has the most number of pubs in Kerala. With international beaches
in Kovalam and Varkala and highland tourist centres like Ponmudi and Agastyamala, Trivandr um
Districts contributes to around 34% of Kerala's Tourist revenues followed by Ernakula m,
Alappuzha and Kollam.

INFRASTRUCTURE

Kerala has 145,704 km of roads (4.2% of India's total). This translates into about 4.62 km of road
per thousand population, compared to an all-India average of 2.59 km. Virtually all of Kerala's
villages are connected by road. Traffic in Kerala has been growing at a rate of 1011% every year,
resulting in high traffic and pressure on the roads. Total road length in Kerala increased by 5%
between 2003-2004. The road density in Kerala is nearly four times the national average, and is a
reflection of Kerala's unique settlement patterns. India's national highway network includes a
Kerala-wide total of 1,524 km, which is only 2.6% of the national total. There are eight designated
national highways in the state. Upgrading and maintenance of 1,600 km of state highways and
major district roads have been taken up under the Kerala State Transport Project (KSTP), which
includes the GIS-based Road Information and Management Project (RIMS). Kerala ranks second
nationwide in diesel-based thermal electricity generation with nationa l market share of over 21%.

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 ECONOMY OF KARNATAKA

Karnataka is one of the high economic growth states in India with the expected GSDP (Gross State
Domestic Product) growth of 8.2% in the fiscal year 201020118 . The total expected GSDP of
Karnataka in 20102011 is about Rs.2719.56 billion. Per capita GSDP during 20082009 was
US$1034.9. Karnataka recorded the highest growth rates in terms of GDP and per capita GDP in
the last decade compared to other states. In 200809, the tertiary sector contributed the most to the
GSDP amounting to US$31.6 billion (55 percent), followed by the secondary sector, contributing
US$17 billion (29 percent), and the primary sectors contribution amounting to US$9.5 billion (16
percent). With an overall GDP growth of 56.2% and a per capita GDP growth of 43.9% in the last
decade, Karnataka surpassed all other states in India, pushing Karnataka's per capita income in
Indian Rupee terms to sixth place. Karnataka received US$2,026.4 million worth of Foreign Direct
Investment for fiscal year 200809 placing it at third spot among states in India. At the end of
2004, the unemployment rate of Karnataka was 4.57% compared to a national rate of 5.99%. For
the fiscal year 200607 the inflation rate of Karnataka was 4.4% which was less than the national
average.

The different entities that contribute to the economy are broadly classified into three sectors

1. Primary: Consisting of Agriculture, animal husbandry, forestry, logging and fishing

2. Secondary: Consisting of Mining, quarrying, manufacturing, construction, electricity, gas
and water supply.
3. Tertiary: consisting of Transport, Education, Storage, Communication, trade, hotel,
restaurant, banking, insurance, real estate, business service, public administration and other
services.

The contribution of primary, secondary, tertiary sectors to Karnatakas GSDP has been 19.2%,
26.2% and 54.6% respectively.

8 States economic growth poised at 8.2% The Hindu, 24 february 2011, retrieved on February 14, 2016

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AGRICULTURE

For many rural residents of Karnataka, agriculture is the major occupation. A total of 123,100 km
of land is cultivated in Karnataka constituting 25.3% of the total geographical area of the state.
According to the 2001 census, farmers and agricultural labourers formed 56% of the workforce of
Karnataka9 . Agriculture in Karnataka is heavily dependent on the southwest monsoon since the
extent of arid land in the state is second only to Rajasthan. Only 26.5% of sown area (30,900 km)
is subjected to irrigation. The state has three agricultural seasons Kharif (April to September),
Rabi (October to December) and Summer (January to March). The main crops grown here are rice,
ragi, jowar, maize, and pulses (Tur and gram) besides oilseeds and number of cash crops. Cashews,
coconut, arecanut, cardamom, chillies, cotton, sugarcane and tobacco are among the other crops
produced in the state. Karnataka is the largest producer of coarse cereals, coffee, raw silk and
tomatoes among the states in India. Horticultural crops are grown in an area of 16,300 km and the
annual production is about 9.58 million tons. The income generated from horticulture constitutes
over 40% of income generated from agriculture and it is about 17% of the state's GDP. In
floriculture, Karnataka occupies the second position in India in terms of production and 700 tons
of flowers (worth Rs.500 million) were produced in 200405.

A majority of the 35 billion silk industry in India is headquartered in Karnataka State, particular ly
in Mysore and North Bangalore regions of Doddaballapura, the upcoming site of a 700 millio n
"Silk City".

Education is an important industry for Karnataka. It boast one of the largest concentration of
Higher educational institutions like Medical and Engineering colleges. Apart from Bengalooru
places like Belgaum, Mangalore, Mysore, Hubli-Dharwad and Davangere have been producing
professionals for IT industry. A large number of professionals educated in Karnataka can be seen
all over India and the World.Muddenahalli, in North Bangalore, is the site of the upcoming Sri
Sathya Sai Baba University and College of Medicine and branch of Visvesvaraya Institute of
Advanced Technology. Devanahalli is set to be the location of a 95 billion Devanahalli Business
Park, which will contain Aerospace Education Special Economic Zones, near the Bengalur u
International Airport. The North Bangalore region is set to be a premier educational hub of

9 Karnataka Human Development Report 2005 government of India, retrieved on February 14, 2016

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Karnataka. Gulbarga in the northern part of the state is another hub for education with several
engineering colleges and a central university. These developments are set to contribute
significantly to Karnataka's economy by creating jobs, expanding educational opportunities, and
spurring infrastructure development.

INDUSTRY

Karnataka evolved as the manufacturing hub for some of the largest public sector industries of
India after independence. Hindustan Aeronautics Limited which is dedicated to research and
development activities for indigenous fighter aircraft for the Indian Air Force employs over 9,500
employees making it one of the largest public sector employers in Karnataka.

Other heavy industries such as National Aerospace Laboratories, Bharat Heavy Electrica ls
Limited, Indian Telephone Industries, Bharat Earth Movers Limited (BEML), Bharat Electronics
Limited, Hindustan Machine Tools and Indian subsidiaries of Volvo and Toyota are also
headquartered in Bangalore. India's national space agency Indian Space Research Organizatio n
(ISRO) is headquartered in Bangalore and employs approximately 20,000 people. TVS Motors has
a motorcycle manufacturing plant at Mysore and Tata Motors at Dharwad. Karnataka state has
many companies engaged in manufacturing of electrical equipments and machinery like Kirloskar,
ABB, Kavika, Larsen and Toubro etc. This may be due to the location of the Central Power
Research Institute (CPRI) at Bangalore.Many multinational companies ( MNC ) have set up their
manufacturing units in Karnataka like BASF, Bosch. The Karnatak state has many sugar factories
in northern region and also edible oil processing units. There are many pharmaceutical factories
and textile processing units in state of Karnataka. The steel producing units of Kirloskar,Jinda l,
Kalyani groups are located in the state. Vishwesharaiya steel plant at Bhadravati is run by SAIL,
Also there is a pellet making factory at Panambur of Kudremukha company.

There is petroleum refinery, Mangalore Refinery and Petrochemicals Limited ( MRPL ) at

Katipalla in Dakshina Kannada district.There is also fertiliser factory MCF near New Mangalore
port.There are many roof tile and Beedi manufacturing firms in coastal districts of the state.

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MINERALS

Gold, iron ore, quartz, limestone, manganese, kyanite and bauxite are some of the minerals that
are found in Karnataka. After the closure of the Kolar Gold Fields mine in Karnataka, the only
company in India that produces gold by mining and extracting it from the ore is Hutti Gold Mines
Limited that has plants at Hutti and Chitradurga in Karnataka. Major mines of manganese and iron
ore are located at Sandur in Bellary district. Visweswaraiah Iron and Steel Ltd. at Bhadravathi and
Jindal Vijayanagar Steel Ltd. at Toranagal are engaged in the production of iron and steel. Indian
Aluminium Company Ltd (Hindalco) has an aluminium plant near Belgaum. Mysore Minerals
Limited is in the mining and production of chromite in Hassan district. Rajashree Cements at
Adityanagar, Vasavadatta Cements at Sedam and The Associated Cement Company Ltd. at Wadi
are engaged in the production of cement. Uranium deposits have recently been found in Deshnur,
a small village near Belgaum.

INFORMATION AND BIOTECHNOLOGY

Karnataka is the leader in the information technology sector in India and its capital Bangalore is
known as the Silicon Valley of India. In the IT sector, Karnataka generated a total revenue of
Rs.516.5 billion in the financial year 200607 which included Rs.487 billion from software exports
and Rs.29.5 billion from hardware exports. A total of 1973 companies in Karnataka are involved
in Information Technology-related business. While the bulk of the IT related companies are
located in Bangalore, some companies are located in Mysore and Mangalore as well. Bangalore is
also the headquarters of Wipro and Infosys which are among the top three IT companies in India
with respect to market capitalization. The Nandi Hills area in Devanahalli outskirts is the site of
the upcoming $22 Billion, 50 square kilometre BIAL IT Investment Region, one of the largest
infrastructure projects in the history of Karnataka.

As of June 2006, Karnataka housed 55% of biotechnology related companies in India. Bangalore
is also the home of the largest biocluster in India with total revenues of Rs.14 billion and having
158 of the 320 companies working on biotechnology in India. Karnataka has a headcount of over
6800 scientists involved in biotech research and out of 28 biotech companies that were registered
in India in the year 200506, 27 were located in Karnataka.

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BANKING IN KARNATAKA

Karnataka, particularly the coastal districts of Dakshina Kannada and Udupi kave a premier
position in banking in India10 . This is because seven of the country's leading banks, Canara Bank,
Syndicate Bank, Corporation Bank, Vijaya Bank, Karnataka Bank, Vysya Bank and the State Bank
of Mysore originated from this state.[27] The first five in the above list of banks were established
in the districts of Udupi and Dakshina Kannada. These districts have among the best distributio ns
of banks in Indiaa branch for every 500 persons. Between 1880 and 1935, 22 banks were
established in coastal Karnataka, nine of them in the city of Mangalore.

As of March 2009, Karnataka had 5759 branches of different banks servicing the people of the
state. The number of people served by each branch was 10,000 which is lesser than the national
average of 15,000, thereby indicating better penetration of banking in the state.

10Ravi Sharma. "Building on a strong base". Online Webpage of The Frontline, Volume 22 Issue 21, Oct. 08 21,
2005. 2005, Frontline. Retrieved 2016-02-14.

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 ECONOMY OF ANDHRA PRADESH

The growth in the state of Andhra Pradesh was mainly driven by agriculture, industry and service
sectors. The priority areas of the state in the economy include Food processing, Software Export,
Financial Services, Electronics, power, Textiles and Tourism.

The Godavari and Krishna are the two important rivers flowing through the state providing
irrigation. The state has also started to focus on the fields of information technology and
biotechnology. Andhra Pradesh is a mineral rich state with largest limestone and also offshore
Krishna-Godavari basin gas reserves of 60 Trillion cubic feet.

In 2012-13, the Gross State Domestic Product (GSDP) of Andhra Pradesh at constant prices
stood at 2359.3 billion (US$35 billion) and the Gross State Domestic Product at current prices
for the same fiscal year stood at 4193.91 billion (US$62 billion). The per capita income of the
state increased by 6.26% from 25,959 (US$380) (200405) to 42,186 (US$620) (2012-13)11 .

Growth of different sectors 20122013

The sectoral composition of GSDP growth for 200809 in Service sector with 10.06% has
maintained the same growth tempo, while the Agriculture sector with 2.27% and industry sector
with 0.12% have recorded little lesser growthrate. At All India level (GDP), the Sectoral Growth
rate in Service sector is 9.67%, while in Agriculture Sector, it is 1.60%. In these both sectors, our
State Growth rate is higher than All India level. The relative decline in agriculture growth during
200809 is due to a very high base effect during the previous years especially last year i.e.
14.85%. However, the foodgrain production has reached a peak of 20,404,000 tones during the
year 200809.

11 economy AP state portal. pp. 6465, 92, retrieved on February 14, 2016

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Per capita income

The per capita income figure gives a better idea of the standard of living of the people. The Per
Capita Income of Andhra Pradesh at current prices is estimated at Rs.39,597 in 200809 as
against Rs.35,864 in 20072008.

Public finance

The finances of Government of Andhra Pradesh are robust due to efficient public finance
management. The State is well in advance in eliminating revenue deficit and achieving other
fiscal targets enacted in APFRBM Act, 2005. The State revenue receipts stood at Rs.696.85
million in 200809 (RE) of which the State own revenue is Rs.44,138 crore. The revenue
receipts under State own taxes during the year 200809 (RE) stood at Rs.35,739 crore as against
Rs.28,794 crore in the previous year registering a growth rate of 24.12%. Total expenditure
(revenue + capital) stood at Rs.85,363 crore for the year 200809 (RE). The capital expenditure
constituted 20.78% of the total expenditure (revenue + capital). Revenue Surplus for 200809
(RE) is Rs.2,066 crore. The Fiscal Deficit is Rs.10,427 crore which 2.81% of GSDP

Agriculture and Aquaculture

Agriculture has been the chief source of income and main occupation for the state with 60% of
population engaged in agriculture and related activities. Rice is the major food crop and staple
food of the state. Other important crops are sugarcane, cotton, mango, tobacco, Maize, pulses etc.
Four important rivers of India, the Godavari, Krishna, Penna, and Tungabhadra flow through the
state, providing irrigation. Recently, crops used for vegetable oil production such as sunflower and
peanuts have gained favour. There are many multi-state irrigation projects in development,
including Godavari River Basin Irrigation Projects and Nagarjuna Sagar Dam.

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Andhra Pradesh was among the very few states in the country which went in for the Green
Revolution in rice cultivation in the 1970s. Average per capita agricultural income in the state was
54.599 billion (US$800 million) at constant prices (201213).

Aquaculture

Aquaculture such as cultivating fish, crustaceans, molluscs, Shrimp production etc., are the major
occupations of coastal areas. Andhra Pradesh is the largest producer of shrimp in the country, with
70% of the production from the state itself. The geographical location of the state allows marine
fishing as well as inland fish production. Cyclones may do less damage to aquaculture than to crop
production. Hence, farmers are getting attracted towards this industry. It grew from 3.46 billio n
(US$51 million) to 5.61 billion (US$83 million). The Waterbase Limited is an aquaculture unit
located at Nellore, it encourages scientific shrimp farming. Most exported marine exports include
Vannamei shrimp.12

Industries

The domestic product of Industrial sector accounts for 507.45 billion (US$7.5 billion). The state
has also started to focus on the fields of information technology and biotechnology. Several major
industries are in operation in Visakhapatnam. Automobiles and Auto components Industry, spices,
mines and minerals, Textiles and apparels, IT industry, Bulk drugs and pharmaceutica ls,
horticulture, poultry farming are the main industries in Andhra Pradesh.

Industrial estates

As of June 2013, the state had 39 operational special economic zones (SEZs). There are 272
Industrial estates and industrial development areas in the State, covering an area of 14700 hectares.
The State Government is in the process of developing Industrial Parks at different places, for
specific groups of industries like Visakhaatnam Export Processing Zone.

Food parks, one each in the 2 regions of Coastal Andhra (value added rice products, dairy,
horticultural, marine etc.); and in Rayalseema region (processing of vegetables, edible oils and

12 Vannamein Hatcheries Coastal Aquaculture Authority, retrieved on February 14, 2016

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export oriented industry). Agri Export Zones for the following produce are proposed at the places
mentioned against them:

Red Chilli Guntur district,

Mangoes Krishna district,

Mango pulp and fresh vegetables Chittoor

Resources

Gross state domestic product (GSDP) of industries was estimated at US$137.3 billion for 2012
13. Andhra Pradesh is one of the store houses of mineral resources with large deposits of
Chrysotile, mica Asbestos, barytes and limestone India. It accounts for about 93% of total
production of Barytes in India.

Andhra Pradesh has varied geological formations with a rich variety of industria l minerals and
building stones. Other important minerals in the state are copper ore, manganese, mica, coal and
limestone. Minerals like coal, oil and Natural gas, barytes, Limestone, diamond, gold beach sand
bauxite, ball clay fire clay, dolomite, dimensional stones etc. are still under tapped or untapped.
The wide variety of minerals from the State is being traded or consumed in Power, Metals, Alloys,
Cement, Chemicals, Paint, Cosmetic, Glass, Ceramics, Refractory, Refinery and manufacture of
various down stream industries.

Minerals found in the state include limestone, reserves of Oil and Natural Gas, Manganese,
Asbestos, Iron Ore, Ball Clay, Fire Clay, Gold Diamonds, Graphite, Dolomite, Quartz, Tungsten,
Steatitic, Feldspar, Silica Sand etc. It has about one third of India's limestone reserves and is known
for large exclusive deposits of Barytes and Galaxy granite in the international market.13

13industrial and fertilizers minerals Geological Survey of India portal. CGPB Committee-IV. pp. 1744. Retrieved
on February 14, 2016

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 ECONOMY OF TELANGANA

The Economy of Telangana is mainly driven by agriculture. Two important rivers of India, the
Godavari and Krishna, flow through the state, providing irrigation. Farmers in Telangana mainly
depend on rain-fed water sources for irrigation. Rice is the major food crop. other important crops
are cotton, sugar cane, mango and tobacco are the local crops. Recently, crops used for vegetable
oil production such as sunflower and peanuts have gained favour. There are many multi-state
irrigation projects in development, including Godavari River Basin Irrigation Projects and
Nagarjuna Sagar Dam, the world's highest masonry dam.

The state has also started to focus on the fields of information technology and biotechnolo gy.
Telangana is one of top IT exporting states of India. There are 68 Special Economic Zones in the
state14 .

Telangana is a mineral-rich state, with coal reserves at Singareni Colleries.

Agriculture

Rice is the major food crop and staple food of the state. Other important crops are tobacco, mango,
cotton and sugar cane. Agriculture has been the chief source of income for the state's economy.
Important rivers of India, the Godavari, Krishna flow through the state, providing irrigation. Apart
from major rivers, there are small rivers as Tunga Bhadra, Bima, Dindi, Kinnerasani, Manjeera,
Manair, Penganga, Pranahitha, peddavagu and Taliperu.There are many multi-state irrigatio n
projects in development, including Godavari River Basin Irrigation Projects and Nagarjuna Sagar
Dam, the world's highest masonry dam.

Agri Export Zones for the following produce are proposed at the places mentioned against them:

Gherkins Mahaboobnagar, Rangareddy, Medak, Karimnagar, Warangal

Mangoes and Grapes - Hyderabad, Rangareddy, Medak, M

Industries

14 TG special economic zone , sezindia, retrieved on February 14, 2016

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Several major manufacturing and services industries are in operation mainly around Hyderabad.
Automobiles and auto components industry, spices, mines and minerals, textiles and apparels,
pharmaceutical, horticulture, poultry farming are the main industries in Telangana.

In terms of services, Hyderabad is usually nicknamed as Cyberabad due to its informa tio n
technology foray and location of major software industries in the city. Prior to secession, it
contributed 15% to India's and 98% to Adhra Pradesh's exports in IT and ITES sectors last
201315 .With Hyderabad as in the front line of Telangana's aims to promote information technology
in India, the city boasts the HITEC City as its premier hub.

The state government is in the process of developing Industrial Parks at different places, for
specific groups of industries. The existing parks are Software Park at Hyderabad, HITEC City for
software units, Apparel Park at Gundlapochampalli, Export Promotion Park at Pashamyla ra m,
Bio-technology park at Turkapally.

Telangana, specifically Jubilee Hills, Hyderabad, is the headquarters of an international non-profit,

the Indian Heart Association.

15special governance needed for Hyderabad for growth times of india , 25 june 2013, retrieved on February 14,
2016

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 CONCLUSION

We have seen that Karnataka has been the top economic performer in southern India in the post-
reform period followed by Tamil Nadu. The growth performance of Andhra Pradesh and Kerala
has been below par. The strong performance of a number of years has brought Tamil Nadu to a
position of an advanced industrialised state although in the recent period the industrial growth in
that state has slowed down. Its agriculture also is the most efficient among the southern states a
major reason being that it is the most irrigated state in the South. Andhra Pradesh, Karnataka and
Tamil Nadu have a mix of small, medium and large industries covering a large spectrum of
products; Kerala is industrially weak having mostly small and medium industries in limited
product categories, which are relatively less capital intensive. There is good investment climate in
all southern states except Kerala where labour militancy, low labour productivity, poor
infrastructure, and bureaucratic over-regulation have made the state investment unfriend ly.
Agriculture also suffered severely in Kerala till very recently as the prices of its major crops,
mostly cash crops, collapsed since the mid-1990s.

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 REFERENCES

1. The times of India.

2. Geological survey of India portal.

3. www.sas.upenn.edu

4. The Hindu

5. Hindustan Times.

6. www.wikipedia.org

7. www.bharatonline.com

8. www.ibef.org

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