CHIEF MINISTER MAHARASHTRA STATE M ANTRAL A YA, MUMBAI 400 032 Phone : 22025151, 22025222 Fax : 22029214 22/02/2005 MESSAGE Maharashtra enjoys a historical reputation of being among progressive and well-administered States in the country. The State Government is aware that although progress has been achieved in various sectors since the inception 01 Maharashtra, much remains to be done in many fields. The Government is, therefore, undertaking strenuous efforts to provide basic minimum services to the people in Maharashtra. I compliment the Planning Commission for coilabrating with the State Government in preparation of Maharashtra Development Report(MDR), which provides an in - depth analysis of the present status of the State in various developmental sectors. Preparation of Maharashtra Development Report(MDR), thus, becomes a very relevant exercise for reviewing the document effort of the State. The report reflects the potential of the State in the medium term as compared to other regions in India and the world. The objective of MDR is not merely to state policies and achievements of the Government, but it is document that points out various lacuna that exist and the road map for the substantiate development of the State. The report covers economic growth and its components including agriculture, industry and services over the last few decades. Its highlights the performance of the State in terms of growth in employment, availability of infrastructure poverty in the State, fiscal situation, various investments scheme and social indicators. I am sure, that this authoritative and comprehensive document, so meticulously prepared, providing a realistic assessment of the current status of development of Maharashtra, will serve as a guide for future planning both within and outside Govt, in order to achieve the socio-economic progress of our people and improve the status of Maharashtra State. I appreciate this endeavor whole heartedly. yvt± ( VilaSrao Deshmukh ) MONTEK SINGH AHLUWALIA DEPUTY CHAIRMAN PLANNING COMMISSION INDIA February 2 1, 2005 FOKFAVOKI) One of the important Tenth Plan initiatives of the Planning Commission was to sponsor the preparation of State Development Reports with much of the work being done by reputed national level institutes. This exercise was undertaken in recognition of the fact that economic circumstances and performance in individual States varied considerably and it was necessary to examine development challenges for individual States in the light of State specific constraints and circumstances. The basic idea is to produce quality reference documents on development profiles of individual States and the possible strategies for accelerating growth, and reducing poverty and inequality. The Maharashtra State Development Report reviews Maharashtra’s experience and highlights issues critical for the State's development in the years ahead. I hope its publication will stimulate debate on growth strategies appropriate for Maharashtra. I am sure the road map indicated in the Report will stimulate a broader awareness of the critical policy issues facing the State and will assist the State to move to a higher growth path and to achieve all round human and economic development. (M .S. AHLUWALIA) Yojana Bhawan, Parliament Street, New Delhi-110001, Phones : 23096677, 23096688 Fax: 23096699 YOJANA BHAWAN PARLIAMENT STREET NEW DELHI-110 001 Tel 23096566(0) :23096567(Fax) E-mail yugandharbn® Maharashtra, one of the most industrialized and progressive slates of India, is currently at crossroads. The state has been facing enormous fiscal strain in recent years resulting in inadequate public investment in phvsical and social infrastructure. It is high time the state's economic policies are reviewed and corrective steps taken wherever necessary so that the state could realize its growth potential. The State Development Report (SDR). Maharashtra attempts a comprehensive and scholarly analysis of the major issues faced by the state's economy and puts forward a number of relevant and implementable recommendations. The report reflects the growth potential of the state in the medium lerni. It suggests the need for better cohesion among various policy objectives and underlines the need for urgent measures for improving the social infrastructure, ensuring equity and human development. Further, it recommends the participation of the private sector in infrastructure development and calls for sincere efforts from the government to prevent the w idening imbalances at various levels. I would like to place on record Planning Commission’s appreciation to all those who have worked hard in preparing the Report, especially Indira Gandhi Institute of Development Research (1G1DR). Mumbai, the lead agency which coordinated the preparation of the report and the partner agencies i.e. Gokhale Institute of Politics and Economics, Pune. Jamnalal Bajaj Institute of Management Studies. Mumbai and fata Institute of Social Sciences. Mumbai. I appreciate the efforts of Dr. Vinod Kumar Sharma. Professor. IG1DR and Coordinator of the Report in bringing out this valuable document. I would also like to thank Ms. Sushnia Choudhary. Pr. Adviser, Planning Commission. Shri N.D. George. Director. Planning Commission, other officers and staff of Planning Commission, and the officers of the Government of Maharashtra for their help in the preparation of this Report. Acknowledgments This report is the outcome of the rigorous Dr. R. Radhakrishna, Director of IGIDR efforts and generous contributions of many cooperated wholeheartedly in co-ordinating the individuals and organisations. The Planning work on the report and provided useful guidance Commission, Government of India, entrusted the and encouragement right since the inception of the task of co-ordinating and preparing the Maharashtra report. He also reviewed and provided valuable State Development Report (MSDR) to Indira contributions to various Chapters of MSDR. Many Gandhi Institute of Development Research other colleagues at IGIDR also contributed during (IGIDR), Mumbai. Other collaborating partners of this work. We highly appreciate the comments and this report are Gokhale Institute of Politics and suggestions received from Dr. Kirit Parikh, Former Economics (GIPE), Pune, Jamnalal Bajaj Institute Director of IGIDR, and presently, Member of of Management Studies (JBIMS) and Tata Institute Planning Commission, and Professors D. Nachane, of Social Sciences (TISS), Mumbai. We are grateful Nirmal Sengupta, M.H. Suryanarayana, Ashima to all Authors, Experts and Peer Reviewers for their Goyal, Shikha Jha, Jayati Sarkar, Rajendra Vaidya, timely contributions. P.V. Srinivasan, Kausik Chaudhuri, R. Nagaraj, K.V. Shri Montek Singh Ahluwalia, Deputy Ramaswamy, Aldas Janaiah and Srijit Mishra. Chairman, Planning Commission, Government of Several Municipal Corporations extensively India, Shri N. K. Singh, former Member of the shared with us their information and data, which Planning Commission and Shri B. N. Yugandhar, helped in updating different Chapters of the MSDR. Member of the Planning Commission served as the We are particularly thankful to the Municipal Chairman of the Core Committee for different Commissioners of Amravati, Aurangabad, Brihan periods during the preparation of the MSDR. They Mumbai, Kolhapur, Nashik, Navi Mumbai, Pune, took personal interest, gave their valuable time and Sangli-Miraj-Kupwad, Solapur and Thane. Various suggestions and provided overall support for the reports obtained from Mumbai Metropolitan report. Ms. Sushma Choudhary, Principal Advisor, Region Development Authority, Maharashtra Shri P.S.S Thomas, Advisor and Shri N.D. George, Jeevan Pradhikaran and Maharashtra Economic Director, Planning Commission, efficiently co­ Development Council were very useful. ordinated the review of various drafts of MSDR and We sincerely thank Dr. M.G. Rao of NIPFP, Delhi, Mrs. Anita Garware, Chairperson of Indian useful input from them and their colleagues helped a lot in improving the report. Heritage Society, Mumbai, Dr. Burange, Director of Centre for Advanced Studies, University of Shri Jagdish Joshi, former Additional Chief Mumbai, Mr. Shailesh Haribhakti, President of IMC, Secretary and Dr. D. Shankaran, Additional Chief Mumbai, Mr. A. Ramakrishnan, State Excise Secretary, Planning Department, Government of Commissioner, Mr. Chaini, President of MEDC, Maharashtra (GoM), have been very kind in Mumbai and Mr. Garson Da Cunha of AGNI convening several meetings to initiate the work, Foundation for their support in this work. reviewing the progress of the report, arranging for Assistance of Ms. Sangeeta Thakore of IIT crucial information and data and provide useful Bombay in editing the manuscripts, of Mr. Sam suggestions at various stages. Their efforts to get the Thomas of IIT Bombay in designing the covers, of drafts of MSDR reviewed in time by the concerned Mr. G. Badri Narayanan, Ms. Mary Cherical and Mr. Principal Secretaries and Secretaries of the GoM S. Ghatak (all from IGIDR) in providing research improved the quality of the report to a great extent. assistance is highly appreciated. Formatting of In this regard, contribution of Ms. Maitreyi Das, manuscript was done by Mr. Mahesh Mohan of Joint Secretary, Shri A. K. Tiwari, Joint Secretary, IGIDR. Co-operation and support from IGIDR’s Ms. Chitkala Zutshi, Principal Secretary and Ms. S. administration, library and computer staff has been M. Aparajit, Joint Secretary, and of all anonymous uninterrupted and timely. experts who reviewed