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Industrial growth in Kerala: Trends and explanations

Listed author(s):
  • K.K. Subrahmanian

    (Centre for Development Studies)

  • E. Abdul Azeez

    (Centre for Development Studies)

The study traces the trends in industrial growth against the backdrop of the overall economic growth in Kerala under the influence of the ongoing economic reforms and evaluates it against the performance of Karnataka, Tamilnadu and all-India. The analysis reveals that a phase of growth revival has set in the overall economy since the late eighties. Though the manufacturing industry has improved its growth performance over time, the growth rates recorded during the nineties are not higher than the corresponding figures for the eighties. The relatively low growth profile of the manufacturing industry, when the general economy is growing remarkably well, appears a riddle of the recent growth trends under the reform process in Kerala. It is argued that inadequate growth of investment has constrained the pace of modernisation of old units and establishment of new units based on `state-of-art' technology needed for the survival and growth of industries in a globally competitive environment. The study suggests that the lack of a clear and pragmatic approach of the state in its response to the reform process and a positive attitude in its own policies for encouraging private investment makes Kerala a less investor friendly location for manufacturing industry. It underlines the need for a new vision and strategy, which could fully utilise Kerala's comparative advantage in human resources, and place greater emphasis on developing knowledge-based and service industries, for accelerating the growth of income and employment in industry.

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Paper provided by Centre for Development Studies, Trivendrum, India in its series Centre for Development Studies, Trivendrum Working Papers with number 310.

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Length: 47 pages
Date of creation: Nov 2000
Handle: RePEc:ind:cdswpp:310
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Peasanth Nagar, Trivandrum 695 011, Kerala

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  1. Boyce, James K, 1986. "Kinked Exponential Models for Growth Rate Estimation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 48(4), pages 385-391, November.
  2. K.N. Harilal & K.J. Joseph, 2000. "Stagnation and revival of Kerala economy: An open economy perspective," Centre for Development Studies, Trivendrum Working Papers 305, Centre for Development Studies, Trivendrum, India.
  3. Kaldor, Nicholas, 1970. "The Case for Regional Policies," Scottish Journal of Political Economy, Scottish Economic Society, vol. 17(3), pages 337-348, November.
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