Kerala was known for long for its high human development at low incomes. But recent years have seen a great change in the status of Kerala. A fairly high density of population, close settlements in the low lands and coastal plains and the increasing movement towards service sector employment has seen Kerala urbanize rapidly. Urbanization has brought to the fore many daunting challenges before the State. Rapid urbanization calls for greater investment in transportation, housing, sewerage, drinking water and waste management. All this calls for vast improvement in the efficacy of public expenditure.
Agriculture remains a key sector in the Kerala economy. The global commodity price collapse has affected two of Kerala’s most important crops, namely, natural rubber and coconut. Agro processing and value addition, and safe to eat and organic mode of production are to be supported further to improve incomes of the farmers.
Kerala never had great strength in manufacturing and times have become bad. Kerala has taken some major steps in upgrading the skills of labour and for boosting entrepreneurship. Skill training has begun making strides in the State. A boost to entrepreneurship can take place with the implementation of the Comprehensive Mission on Employment Generation. All these should be changing the manufacturing scene in the State.
Kerala’s achievements on social front have been lauded all around. The progress made in the realm of Education, Health and Gender development have been noteworthy. The State has been much ahead of the rest of the states in terms of access to basic services including education and medical care and in improving the socio economic conditions of SC/ST. This has been achieved mainly through large scale intervention and targeted efforts by the Government. However, the effort needs to be sustained to achieve higher levels of social development.
Recognizing the importance of infrastructure, the State has during the last four years given a thrust to major projects like the Kochi Metro, Vizhinjam Port and Kannur Air Port. These projects are expected to bring about major transformation in the State economy. Further to ensure smooth progress of projects the Government has earmarked a lump sum amount for infrastructure development projects. A scheme has also been drawn up by the Finance Department and Planning Board jointly to harness resources into the Kerala Infrastructure Investment Fund through diverse financial instruments. This will ensure that projects which are progressing are not constrained by lack of funds. Though a push has been given to promote infrastructure growth, challenges persist in terms of the emerging infrastructure and urban infrastructure in the State. Similarly, improving the power scenario in the State is imperative. The State needs to explore the full potential of Hydro Electric generation and Renewable Energy. Adequate focus also needs to be given on using energy efficient lighting. The feasibility of innovative approaches like floating Solar Power Plants may be explored.
The Kerala economy has always been more open than the Indian economy. A much higher proportion of its produce had external market as its destination and a sizable part of its consumption came from outside. The last four decades have also seen a sizable proportion of its labour force exploring the globe for employment and the last two decades have seen large migration of labour from other states of India into Kerala in search of work. The growing remittance flow into the Kerala economy has been one of the engines of growth of the economy. The last two decades have seen Tourism bloom in Kerala. Currently the contribution of Tourism to the Kerala economy is over 10 per cent equaling that of agriculture.
Innovation and skilled man power is the need of the hour as the economy moves towards a competitive innovation based economy. Increasing focus on knowledge creation is required to fuel innovation and productivity, growth. Kerala requires a focused approach towards spearheading innovation, entrepreneurship and skill enhancement in the economy. The skill shortage needs to be plugged and effort is required towards acquisition of new skills. The State has to take adequate steps for creating and encouraging an environment which promotes research and development, nurtures entrepreneurial skills and helps in acquisition of new skills attuned to the needs of the economy so as to raise productivity levels in the economy.
Kerala’s decentralization experience is unique and encouraging, and it is recognized world over. The decentralization has had its impact in local level planning. The systems developed under this process have become part and parcel of the development activities at the grass root level. While adequate and enhanced budgetary funds are provided to local governments, there is inadequate capacity among them to conceptualize and prepare detailed project reports, implement and monitor them.
Kerala Perspective Plan 2030 is a strategic articulation of its development vision, mission, goals and objectives, and a high level strategy to achieve them. It also specifies an action plan around the frame work of resources, competencies and capacities. The KPP 2030 identifies critical challenges; provides a strategic frame work for sustainable and inclusive growth drawing on international experiences; sets developed country bench marks for Kerala to achieve; examines the best regional and international practices and provides the rationale for development planning and resource requirement. Creation of knowledge-based economy is central to this Perspective Plan.
The latest edition of the Economic Review is brought out with the objective of providing valuable and comprehensive information about Kerala’s economic performance in the last year of the 12th Five Year Plan. This year also, as usual, the latest available data has been included on Government policy, plan priorities and on-going major programmes/schemes and projects to provide a clear picture of how Kerala’s economy has performed in the first four years of the Twelfth Five Year Plan. A Sub Committee with Dr. D. Narayana, Technical Advisor, Ms. Gayathri Nair, Director, Project Financing Cell and Sri. P. V. Kamalasanan Nair, Chief (in charge) Plan Co-ordination Division as members have carefully gone through the draft report to improve its quality. The list of those involved in the preparation of the respective sections of the Economic Review appears at the end. The performance of the State’s Economy as well as major achievements of various departments is brought out sector wise in Volume I and corresponding data is provided in Volume II. In addition to the General Chapters, a theme paper on ‘Kerala Perspective Plan 2030 – Towards Action and Implementation’ is also included. The Economic Review 2015 is published in print media in English and Malayalam. An e-version is also uploaded to the State Planning Board website www.spb.kerala.gov.in.