Andhra Pradesh Ranks 2nd in Growth: Reasons behind it

Andhra Pradesh’s economic growth rate in the fiscal year 2024–2025 was the second highest in India. Andhra Pradesh has ranked second in the nation with a growth rate of 8.21%, according to state growth rate statistics made public by the Central Government of India. With a growth rate of 9.18%, Tamil Nadu is at the top of this list. These figures show significant shifts in the AP state economy. The residents of AP are feeling hopeful as a result of this news. How was this growth rate determined by the Central Government? For what grounds is this the case? What has changed from the previous year? What developments have taken place after the formation of the coalition government?

How growth rate calculated by the Center?
The Gross State Domestic Product (GSDP) data serves as a baseline for the Indian central government’s computation of the states’ economic growth rates. The National Statistical Office (NSO) is in charge of gathering this data. A state’s gross state product (GSP) is the sum of its products and services. Because it is computed using constant pricing, the impact of inflation is removed. In January 2025, the First Advance Estimates for 2024–2025 were made public. These numbers are derived from economic information gathered from the states, including the services sector, industrial production, and agricultural productivity. The calculation was based on the data provided by the state government and also surveys that took place by the central government.

What are the reasons behind AP coming in the 2nd place?
Andhra Pradesh is rated second with a growth rate of 8.21% for several reasons. Significant advancements have been made, especially in the fields of manufacturing, services, and agriculture. Major ports in the state, such as Visakhapatnam, have seen a surge in trade. Between April and August of 2024, the port of Visakhapatnam handled 35.77 million tons of traffic, a considerable rise over the previous year. Another factor is the rise in investments in the field of renewable energy. For instance, ArcelorMittal and Greenco Group have announced a $600 million investment for a 975 MW renewable energy project. The state’s economic growth has benefited from this. The other main reason for the growth is that the ease of doing business has been improved by the government.

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Developments in the coalition government:
After the coalition government came to power, the government has focused to increase infrastructure, skill development and also developing industries and promoting MSME’s ideas. The state government has planned to develop a green hydrogen production centre in Visakhapatnam and also expanding transport facilities across the state.

Previous Government developments and Growth:

For the fiscal year 2023–2024, Andhra Pradesh’s GDP growth rate is projected to be 6.18%. This growth rate will rise to 8.21% in 2024–2025, putting the state in second place. Reaching this level of growth rate is fantastic, even with the change of government. In addition to the growth rate being marginally higher than it was the previous year, AP has improved its standing by sustaining consistent economic growth. This has been made possible in large part by government infrastructural investments, agricultural modernization, and industry incentives.

Economic Growth Rate In All States:

Telangana state has the sixth-highest economic growth rate in the nation, according to state growth rate figures published by the Central Government of India for the fiscal year 2024–2025. With a growth rate of 9.18%, Tamil Nadu leads the pack, followed by Andhra Pradesh (8.21%), Gujarat, Karnataka, and Maharashtra (3rd, fourth, and fifth, respectively). The growth rate for Telangana was 6.79%. Telangana is still among the top states in the nation, even though its growth rate decreased this year from 11.9% in 2023–2024. This expansion was facilitated by the IT, pharmaceutical, and agricultural sectors.