Delhi's GSDP dips 5.7%

Hit by the Covid pandemic, Delhi’s per capita income has declined by Rs 22,217 and Gross State Domestic Product has shrunk by 5.7% during 2020-21. That contraction is, however, far less than the decline of 8% at the national level during the same period.

According to Delhi’s Economic Survey 2020-2021, tabled by deputy CM Manish Sisodia in the assembly on Monday, despite the decline in per capita income, the average Delhiite earns three times more than the average Indian. Delhi’s per capita income during 2020-21 at current prices has been worked out to be Rs 3,54,004 as against Rs 3,76,221 during 2019-20. Delhi’s GSDP had increased by around 45% in the past six years.

Sisodia said the GSDP contraction was relatively less “because the Delhi government took timely steps to revive the economy.”

Around 80% projects in education and health sectors are “on track”, according to the Outcome Budget 2020-21 presented in the assembly.

Hopes of a robust recovery in the services sector, consumption and investment have been rekindled now with the vaccination drive addressing the pandemic issue, according to the survey. In 2021-22, a sharp recovery of real GSDP of Delhi with double digit growth is expected based on a low base effect and inherent strengths of the economy.

As a general phenomenon observed in most of the urban economies, Delhi is also showing a trend of higher share in the services sector. This sector was a major revenue booster with a share of Gross State Value Added Tax at 82.8% in 2020-21, followed by the secondary sector at13.7% and the primary sector at 3.4%. The services sector also plays a pivotal role in employment generation.

Tax collection registered a negative growth of 0.2% during 2019-20 (provisional) as compared to a growth of 2.5% in 2018-19. Stamps and registration tax (including land revenue) recorded the highest growth of 3.4% in 2019-20 (provisional). However, GST (including VAT and other taxes like luxury and entertainment etc.) and motor vehicles tax have shown a negative growth of 0.6% and 5.2%, respectively.

The tax collection for 2020-21 is budgeted with a growth of 20.60% over the previous year. The government has received small savings loan of Rs 4,540.60 crore during 2019-20 (provisional) as against Rs 2,800 crore in 2018-19. It is expecting a tax collection of Rs 55,309 crore in 2020-21 (budget estimate) with a growth of 17.3% over the previous year.

The total revenue collection of Delhi government was Rs 47,135.81 crore (5.7% of GSDP) in 2019-20 as against Rs 43,112.61 crore (5.7% of GSDP) during 2018-19. During 2019-20 (provisional), revenue receipts increased significantly with a growth rate of 9.3%, mainly due to increase in grants and other receipts from the Centre (nontax revenue). However, the growth of own non-tax revenue of the Delhi government saw a significant growth of 70.3% in 2019-20 as against a negative growth of 15.9% in 2018-19. There was a decline in growth from 167.5% in 2018-19 in grants and other receipts from the central government to 62.1% in 2019-20. The overall expenditure of Delhi in the year 2019-20 was marginally lower than its income, according to the survey. In 2019-20, with an outstanding debt of Rs 34,461.83 crore as on March 31, 2020, the debt GSDP ratio had declined substantially to 4.1% as compared to 8.6% in 2011-12. This has helped Delhi to maintain a consistent revenue surplus, which was calculated at Rs 7,499 crore in 2019-20 compared with Rs 6,261 crore in 2018-19.

In the financial year 2020-21, the education sector remained a priority sector with a maximum allocation of 23.8% (highest among all states) followed by transport (14.7%) and medical and public health (13.4%).

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