Structural Change and Agricultural Performance at the State Level in India: 1980-2010

Abstract

Given the structural transformation at national level to be stunted one, the paper has compared this process with related issues at a state level in India. The study has found that the economic reforms have led not only to a sharp rise in the growth rates across all states, but also to the disappearance of the relationship between initial income and growth. The growth of agriculture in India appears almost to be decoupled from the rapid economic growth. The study has concluded that the structural convergence of the economy has started in 6 out of 15 states, suggesting that a faster growth may bring structural transformation closer than what the national picture has suggested. There are strong common trends in the sectoral composition of the economy across the states, but with wide variations around them. For the sectoral composition of agriculture, on the other hand, there are both common and divergent trends. In agriculture, changes in comparative advantage and trade opportunities are the additional important drivers of change in the sector composition of output.