Industrial resurgence signs overlooked: Survey

New Delhi, Feb 27 (UNI) Despite the commendable growth in India's industrial sector, the Economic Survey 2006-07 notes that the lower contribution of industry to GDP growth relative to services is partly because of its lower share in GDP and overlooks signs of industrial resurgence.

Calling for adequate expansion of employment in the industrial sector, particularly in the organised segment, the Survey favours formation of appropriate skills through a wide variety of vocational training as well as optimal degree of flexibility of labour laws.

"Progress on these fronts will determine how much progress is made in generating employment in the organised industry in the years to come," states the Survey, tabled in Parliament by Finance Minister P Chidambaram today.

The country's industrial sector has grown from barely 2.7 per cent in 2001-02 to 7.1 per cent and 7.4 per cent in 2002-03 and 2003-04 respectively. After accelerating to more than 9.5 per cent in the next two years, it touched 10.0 per cent in 2006-07.

Since 1951-52, industry has never consistently grown at more than seven per cent a year for more than three years in a row before 2004-05.

According to the Survey, the industrial growth would have been even higher, had it not been for a relatively disappointing performance of the two sub sectors, namely, mining and quarrying; and electricity, gas and water supply.

The continuing broad-based growth in the services ector,especially the three sub-sectors of services, trade, hotels, transport and communication services, has continued to notch up double digit rates for the fourth successive year led by Information Technology (IT) enabled services giving a boost to the sector.

The Survey says sustained economic growth, fiscal consolidation and an enabling policy environment will continue to provide incentive to capacity addition in industry and to sustain the momentum.

UNI