Rajasthan : An introduction to  Economy

Rajasthan : An introduction to  Economy


  • Rajasthan, the largest (area-wise) state in India, is located in the north-western part of the subcontinent. It is surrounded on the north and north-east by Punjab, Haryana and Uttar Pradesh, on the east and south-east by Uttar Pradesh and Madhya Pradesh and on the south-west by Gujarat.Rajasthan : An introduction to  Economy




  • Rajasthan offers tremendous opportunities in the areas of organic and contract farming as well as in infrastructure developments related to agriculture. Rajasthan is the largest producer of rapeseed, bajra and mustard. It is the second largest producer of oilseeds and spices and third largest producer of soya bean and coarse cereals in India. Rajasthan is a leading producer of limestone, silver, gold, copper, marble, sandstone, rock phosphate, and lignite. The state is the largest producer of cement in India. It has 24 major cement plants. Rajasthan is also the second-largest producer of milk and the largest producer of wool in India.


  • Rajasthan has reserves of numerous precious and semi-precious stones and is the largest manufacturer of cut and polished diamonds in the country. The world’s largest centre for gemstone cutting and polishing is located in Jaipur.


  • In 2016, tourist arrivals in the state reached 43 million. Historic palaces, especially those in Jaipur and Udaipur, offer opportunities to expand the luxury tourism segment, with increasing number of tourists visiting wild life sanctuaries and desert locations. Tourists greatly add to a state’s economy. Rajasthan is no exception to this. It was on November 4, 2015 that Rajasthan signed the 76 memoranda of understanding (MOUs) worth Rs 319 crore in its tourism sector with different private entities. These MOUs are specially focused on setting up hotels, resorts and motels with the aim to provide direct employment to over 2800 people.



  • The gross state domestic product (GSDP) of Rajasthan expanded at a compound annual growth rate (CAGR) of 5.16 per cent over 2011-12 to 2016-17. The state has attracted Foreign Direct Investment (FDI) equity inflows worth US$ 1.547 billion during the period April 2000 to June 2017, according to data released by Department of Industrial Policy and Promotion (DIPP).


  • The state has immense potential for electricity generation through renewable energy sources and wind power. Rajasthan Renewable Energy Corporation Ltd has actively promoted solar energy and biomass projects. As of October 2017, Rajasthan had a total installed power generation capacity of 20,846.47 megawatt (MW).


  • The state has a considerable pool of skilled and technically qualified human resources with more than 200,000 students enrolled in technical institutions. In line with this, a number of IT parks with special infrastructure are being developed.


  • The policy environment has been favourable for the establishment of industrial units. A single window clearance system (SWCS) for investment approvals is operational in the state and the Bureau of Investment Promotion (BIP) was set up to focus on investments above US$ 2.2 million. Rajasthan stands sixth among Indian states in rankings based on ease of doing business and reforms implementation, according to a study by the World Bank and KPMG.


Key Sectors:

  • Out of the total allocated budget for operating industries and mineral sector, US$ 22.91 million was proposed to be allocated to the Internal and Extra Budgetary Resources (IEBR) of Rajasthan State Mines and Minerals Ltd. In addition, US$ 36.15 million was proposed to be allocated for the Industries Department and US$ 1.05 million for the Bureau of Investment Promotion of the state.


  • Rajasthan has huge reserves of cement-grade and Steel-Melting-Shop (SMS) grade limestone. SMS-grade limestone from Jaisalmer is supplied to various steel plants in the country.


  • Rajasthan has 24 major cement plants, having a total capacity of 55 million tonnes per annum (MTPA). It is the largest cement-producing state in India.


  • As per budget 2016-17, US$ 4.16 million was allocated by the State Government for the Mines and Geology Department. The state government has allocated US$ 22.91 million for the environment, road and medical related works during 2016-17.


  • The Alwar and Jaipur districts are close to major auto production hubs of the country such as Noida (Uttar Pradesh), Gurgaon and Dharuhera (Haryana); offering excellent advantages for setting up of auto and auto ancillary units.


  • Over 100 units are currently functional in Bhiwadi, Neemrana and Pathredi in Alwar district, Rajasthan. These are the 3 main auto clusters in Rajasthan.


  • During the agriculture year 2016-17, the total food grain production in the State is expected to be 213.12 lakh tonnes as compared to production of 182.98 lakh tonnes in the agricultural year 2015-16, which is showing an increase of 16.47 per cent over the previous year.


  • Under National Horticulture Mission, Orchards of fruits and spices have also been established in 3,288 hectare and 1,341 hectare respectively. Under Pradhan Mantri Krishi Sinchai Yojana, drips and sprinklers have been installed in 6,235 hectare and 3,748 hectare respectively during the year 2016-17, upto December, 2016. Agricultural Marketing Board has spent `310.13 crore on construction of mandi yards and roads and their repairing, cold storages and deposit works during the year 2016-17, uptoDecember, 2016.


  • There are 156 mining leases for major minerals and 15,318 mining leases for minor minerals and 18,103 quarry licenses exist in the state. During the current year 2016-17, a revenue target of `4000.00 crore was assigned against which `2,748.70 crore has been earned upto December, 2016.





The General Index of Wholesale Prices (Base year 1999-2000=100) of the state during the year 2016 stood at 282.61 as against 272.75 in the year 2015, which shows an increase of 3.62 per cent over the previous year. The index of Primary Articles Group registered an increase of 5.23 per cent, Fuel, Power, Light and Lubricants Group increased by 4.65 per cent and Manufactured Product’s Group increased by 1.70 per cent over the previous year. While at all India level, the General Index of Wholesale Prices (Base year 2004-05=100) increased by 1.95 per cent in the year 2016. A rising trend has also been observed in Consumer Price Index for Industrial Workers (CPIIW) for the year 2016. General Consumer Price Index (Base year 2001=100) for the year 2016 recorded an increase of 4.90 per cent at Jaipur Centre, 3.23 percent at Ajmer centre and 3.86 per cent at Bhilwara centre over the previous year.

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