Basic Features of Mizoram Economy
Mizoram Economy is based on agriculture, horticulture, forest products, industry, mineral, and tourism sectors. The gross state domestic product (GSDP) of Mizoram amounted to Rs 3,410 million in 1990, in 1995 this figure amounted to Rs 9,370 million, and in 2000 this figure stood at Rs. 17,690 million. This shows that the Economy of Mizoram has grown at a very slow pace.
However, by the year 2007 onwards Mizoram became one of the fastest growing economies among the states of India with a per capita income of Rs 50,021. Mizoram had the second highest GSDP growth during the 11th Five Year Plan (2007-2012) in Northeast India at 11 percent exceeding the target of 7.8 percent which is also much higher than the national average of 7.9 percent. During the 10th Five Year Plan (2002-2007), the Gross State Domestic Product (GSDP) was expected to grow at around 5.3 per cent but grew at 5.7 per cent. The biggest contributors to GSDP growth are Agriculture, Public Administration and Construction work. Tertiary sector of service sector contributes between 58 per cent and 60 per cent to the GSDP during the past half a decade.
Agriculture, Industry and Service sector are the main backbone of Mizoram economy. Though, the state has not yet builds heavy industries and manufacturing industries, industry itself still remain one of the important sectors in the state economy in the form of small scale and handloom industries. Next to Agriculture service sector absorbed the largest working force of the total population.
(1) Agriculture: The Economy in the state of Mizoram depends mainly on the agricultural sector as more than 70% of the people of the state are engaged in this sector. The climatic condition of the state is favorable for the growth of a wide variety of fauna and flora. The various kinds of crops that are grown in Mizoram are rice, cotton, oilseeds, pulses, maize, sesame, and sugarcane. The people follow the method of shifting cultivation which is also known as Jhumming method of cultivation. This sector has given a major boost to the Economy of Mizoram. Though Agriculture and Horticulture are now under separate department, still horticulture is pure branch of agriculture. The Economy of the state of Mizoram gets revenue from the horticulture sector. The state has around 4.40 lakh hectares of land under horticulture cultivation. The main crops grown in the horticulture sector in the state of Mizoram includes pine- apple, orange, and banana. The horticulture sector has witnessed a sharp increase in recent years and this has given a major boost to the Economy in Mizoram. Mizoram Economy gets revenue from the forest products sector as the state has a huge forest cover. The various kinds of forest products manufactured are cane works, bamboo works, and wood works. The products manufactured are sold all over the country and even exported all over the world.
(2). Industry: Mizoram is facing a number of difficulties in the advancement of industries. Lack of means of dependable surface transport and poor accessibility is one of the major drawbacks. Other problems faced by the state were the poor mineral resources, non-availability of good infrastructure and communication facilities, shortage of capital and lack of modern skills. A Software Technology Park is however being established in Mizoram University campus. A Steel Plant is also being established in Mizoram.
(3). Service Sector: According to Mr. Liansailova,the then Finance Minister on a presentation of economic survey in the State Assembly 2013 the service sector remained the dominating sector in the state's economy by contributing 61.04 per cent, while industry and agriculture sector contributed 20.29 per cent and 18.68 per cent respectively even as around 60 per cent of the population depended on agriculture and allied sectors. Taking education under the service sector, education is an important industry for Mizoram. It has a large number of schools including private institutions in the state which employ a number of people. Again under the service sector tourism industry is the potential of the state revenue and is likely to become a boaster for the state economy.
(4) Sericulture: The climatic conditions in the state provide a conducive breeding ground for commercial exploitation of all kinds of silkworms. Sericulture remains one of the state's key industries. As of March 2015, about 7,000 families in 175 villages were engaged in sericulture across 4,300 hectares.
(5). Energy: Mizoram has abundant hydro-electric power potential (around 4,500 MW) with just 0.7 per cent harnessed through small and mini-hydel projects to date.
With a literacy rate of 91.85 per cent, Mizoram offers a highly literate workforce. Knowledge of English is an added advantage for the Mizo workforce.
Finances-Sources of Revenue of Mizoram
Mizoram has not sufficient resources of its own to re-finance its own budget expenditure. It has to rely heavily on the central government. The government of Mizoram has three main sources of revenue or finance, that are;
(i) Funds from the planning commission, (ii) Funds from the Finance Commission and (iii) Centrally Sponsored Scheme that is arranged normally in the form matching share.
(1) Planning Commission: Since India adopted a planned economic system all the states (including Mizoram) and union territories rely on funds coming from the centre. The planning commission assistance also includes Special Plan Assistance,Special Plan Assistance (Grants) and Special Central Assistance (untied Grants). This allocation of resources/finance is one the most important sources of revenue for Mizoram. These funds are usually used for the developmental expenditure.
(2) Finance Commission: Funds coming from the Finance Commission is again an important source of revenue for the state like Mizoram and other backward states which has a very limited capacity on resource mobilization. As per the recommendation of the 13th Finance Commission the total grants for Mizoram for the year 2013-14 is Rs.1104.64 crore. Finance commission grants has two heads namely (i) Plan grants and (ii) Non- Plan grants
Plan Grants includes Elementary Education, Protection of Forests, Incentive for Issuing UIDs, District Innovation Fund and State specific Needs. In the financial year of 2013-14 under plan grants Rs.106.54 crores was allotted. On the Non- Plan Grants the heads like Non Plan Revenue Deficit Grant, Performance Incentive, Local Bodies (General Basic), Local Bodies (General Performance), Local Bodies (Spl. Area Basic Grants), Local Bodies (Spl Area Performance), Disaster Relief Fund (Centre Share), Capacity Building, Water Sector, Delivery of Justice (1/5 of allocation), Grant for State Statistical Systems, Maintenance of Roads and Bridges, Employee & Pension database are kept. In the year 2013-14 the total allotment on non-plan grants was Rs.998.10 crores.
(3) Centrally Sponsored Scheme (CSS): Another important source of revenue or finance of the government of Mizoram is the Centrally Sponsored Scheme. Central assistance through this channel has been benefited in education sector in the form of SSA, RSA and RUSA. Centrally sponsored scheme has also been benefitted for rural development through District Rural Development Agency (DRDA). On the agriculture sector this centrally sponsored scheme has made a great impact on the finance of the state as well as in generating employment and upliftment of the rural community in the state.
