CM forecasts negative growth : Says State GDP will nosedive by Rs 4,000 cr due to mining shutdown

 The State’s Gross Domestic Product will nosedive by Rs 4,000 crore in view of the mining shutdown over the last five months, Chief Minister Manohar Parrikar said admitting that it would impact the State’s growth.

Briefing media after Wednesday’s cabinet meeting, Parrikar also sought to assure that the State treasury was in sound health.

“It is true that we will feel the effects. The state will take Rs 4,000 crore hit to its GDP. 20% of the GDP was from the mining industry. So this year there may be negative growth in GDP and around Rs three to four crore less money in circulation in the State,” Parrikar said adding that the State was no longer getting the around Rs 50-60 crore per month over the last five months that it used to usually earn from mining royalties. Parrikar said the growth in GDP could be in the range of minus 4% to minus 5%. But he claimed to compensate the 20% shortfall in mining through “other activities” which should be able to add up to around 15%.

“There is already a 30% increase in the demand for seeds in the mining belt as agriculture picks up, Parrikar said, adding that he felt that the mining belt could take a hit for two to three months.

He also said that the state’s revenue collection would grow by 3%.  

“Our tax collection in the mining belt has dropped by 25-30% and the sale of vehicles has dropped by 10% in the state saying that there was 15-20% less tax collection on sale of vehicles,” Parrikar said obviously referring to drop in the sales of tipper trucks which has brought the overall vehicle sales figure down.

When asked about the state’s borrowings which have touched Rs 500 crore this year itself, Parrikar said, “In Goa, most of the revenue collection comes towards the end of the (financial) year, whereas salaries have to be paid continuously.” [H]