Small States’ creation: neither panacea nor placebo

Creation of small States does not necessarily catalyse economic growth, says a report by India Ratings. The report titled ‘Small States’ Creation – Neither Panacea Nor Placebo’, points out that “creation of small States is not a panacea to improve economic performance, social indicators and other infrastructure statistics.

Even though the growth performance of small States is commendable, the belief that they necessarily grow faster than large States is flawed.On the basis of analysis of growth performances of the States, the ratings agency said only 11 States grew faster than the country on the whole over 2005-06 to 2012-13. Of these 11, only five were small States – Uttarakhand, Kerala, Haryana, Goa and Himachal Pradesh.

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