Rajasthan Economic Survey 2025-26: Sector-Wise Analysis, PCI & Key Economic Highlights

The Economic Survey is a foundational document prepared by the Directorate of Economics and Statistics, operating under the Department of Statistics. Its primary purpose is to evaluate socio-economic development initiatives and performance within a specific financial year. 

This critical document serves two main functions: it provides a Performance Review of government schemes and policies, and it offers an evidence-based Foundation for the Budget, guiding effective fund allocation.

Key Indicators of Economic Development

The Economic Survey presents a summary of vital indicators that offer a quick snapshot of the state's economic health and development. These indicators allow for a rapid assessment of economic performance without needing to analyze the entire document.

The primary economic indicators typically include:

• Gross Domestic Product (GDP) / Gross State Domestic Product (GSDP): The most important indicator for measuring overall economic growth.

• Gross Value Added (GVA): Used to understand sectoral contributions (Agriculture, Industry, Services) to the economy.

• Net Domestic Product (NDP) / Net State Domestic Product (NSDP): Another measure of economic output, accounting for depreciation.

• Per Capita Income (PCI): Reflects the average income per person, indicating the standard of living and quality of life.

• Total Food Grain Production: Shows the agricultural sector's performance and food self-sufficiency.

• Wholesale Price Index (WPI) & Consumer Price Index (CPI): Used to measure inflation at wholesale and consumer levels, respectively.

• Commercial Bank Credit: Represents total loans disbursed by banks, indicating market liquidity and potential for investment, production, and employment.

Gross State Domestic Product (GSDP)

When analyzing the economic output of a specific state like Rajasthan, the term used is Gross State Domestic Product (GSDP), or Sakal Rajya Gharelu Utpad. It is the total monetary value of all final goods and services produced within the domestic boundary of a state during a specific financial year (April 1st to March 31st).

Key aspects of the GSDP definition include:

• Domestic Boundary: Production must occur within the state's geographical borders, regardless of the producing entity's origin.

• Final Goods and Services: Only the value of final products is counted to prevent double-counting.

• Financial Year: The calculation adheres to a standard one-year period.

GSDP is the most crucial measure for assessing a state's economic health and its pace of development. Consistent growth indicates a healthy and progressing economy.

GSDP Calculation Methods

GSDP is calculated using two different price bases to provide a comprehensive economic view:

The difference is crucial: an increase in GSDP at current prices could merely reflect inflation, whereas an increase at constant prices signifies genuine growth in production.

Key Data for Rajasthan's GSDP (2025-26)

Below, we have provided key data for Rajasthan’s GSDP:

(Memory Tip: To remember the GSDP figures for constant prices, focus on 9.81. For current prices, double the '9' to get 18, and for the decimal, take '8' from 9.81 and subtract one to get '7', giving you 18.75. The constant price growth rate starts with the '8' from 9.81, making it 8.66%.)

Comparison with India's GDP (2025-26)

Below, we have provideda  comparison with India’s GDP:

Global and National Context

According to the IMF, India is the 4th largest economy globally, with an estimated GDP of $4.5 trillion. 

The USA ranks first with approximately $31.8 trillion. Within India, Rajasthan ranks 7th in terms of GSDP contribution, contributing approximately 5.2% to the national GDP. Maharashtra holds the 1st rank, contributing around 13%.

Economic Indicator 2: Gross State Value Added (GSVA)

GSVA is the second major indicator, measuring the value added during the production process. It offers a supply-side or producer-side perspective of the economy, showing the contribution of each stage of production rather than just the final price.

The Concept of Value Addition: GSVA calculates the new value created at each step in the production chain. For instance, in making bread, the farmer adds value by growing wheat (₹100), the miller adds value by processing flour (₹50), and the baker adds value by making bread (₹50). The total GSVA is the sum of these individual value additions (₹100 + ₹50 + ₹50 = ₹200).

Comparison: GSVA vs. GSDP

GSVA and GSDP measure the economy from distinct perspectives:

The fundamental relationship is: GSDP = GSVA + Indirect Taxes on Products - Subsidies on Products.

GSVA Sectoral Contribution in Rajasthan (2025-26 Estimates)

This table details the percentage contribution of the three main economic sectors to Rajasthan's GSVA:

(Memory Tip: For Constant Prices, remember the sequence 25, 28, 46 (with their respective decimals .3, .2, .4). For Current Prices, remember 25, 26, 47 (with decimals .7, .5, .7). )

Composition of Economic Sectors:

1. Agriculture (Primary Sector): Includes Crops, Livestock (Pashudhan), Fishing (Matsya Palan), and Forestry (Vaniki).

2. Industry (Secondary Sector): Comprises Manufacturing (Vinirman), Construction (Nirman), Mining (Khanan), and utilities (Electricity, Gas, Water Supply).

3. Services (Tertiary Sector): Encompasses Professional Services (doctors, lawyers), Banking, Real Estate, Public Administration, Storage, etc.

Economic Indicator 3: Net State Domestic Product (NSDP)

NSDP offers a more precise measure of a state's income by accounting for the depreciation of capital assets.

The Concept of Depreciation (मूल्य ह्रास): Depreciation is the reduction in the value of assets (like machinery or buildings) over time due to use, wear and tear, or obsolescence. Since capital assets become less productive, GSDP, which doesn't account for this loss, can overstate actual sustainable production.

The formula for NSDP is: NSDP = GSDP - Depreciation. NSDP is considered the real net income of the state.

NSDP Figures for Rajasthan (2025-26 Estimates)

As depreciation is subtracted, NSDP values are always lower than GSDP.

(Memory Tip: The '8' from the GSDP constant price growth rate (8.66%) links to the NSDP constant price value of 8.59 lakh crore. For the current price, doubling '8' from 8.59 gives 16, which helps recall 16.85 lakh crore.)

Economic Indicator 4: Per Capita Income (PCI)

Per Capita Income measures the average income per person in a region and is a key indicator of the standard of living.

The formula for PCI is: Per Capita Income = NSDP / Mid-Year Population.

Per Capita Income Figures (2025-26 Estimates)

Below we have provided Per Capita Income Figures:

(Memory Tip: For Rajasthan, remember Constant Price: ₹1.03 Lakh and Current Price: ₹2.02 Lakh (roughly double the constant price).)

Rajasthan's Per Capita Income is lower than the national average at both constant and current prices, suggesting a lower average standard of living compared to the country as a whole.

World Bank Classification: Based on its Per Capita Income, India is classified as a Lower Middle-Income Group country by the World Bank.

Rationale for Higher PCI at Current Prices: Per Capita Income at current (market) prices is consistently higher than at constant prices due to inflation and wage revisions over time. Inflation generally increases the nominal value of income, and periodic wage increases (e.g., minimum wage adjustments, pay commission revisions) also contribute to this rise.

Gross Fixed Capital Formation (GFCF)

Gross Fixed Capital Formation (GFCF), or सकल स्थाई पूंजी निर्माण, measures the net investment in fixed assets within an economy. The Rajasthan Economic Survey calculates GFCF at market prices (current prices).

For the period 2024-25, Rajasthan's GFCF was:

• Absolute Value: ₹5.02 Lakh Crore

• As a percentage of GSDP: 29.53% (approximately 30% or one-third of the GSDP)

Understanding Capital Formation

Capital formation refers to expenditures that create assets capable of generating future revenue. Government spending can be broadly categorized as:

Significance and Benchmark for GFCF

A high GFCF is a positive indicator for future economic health. A GFCF rate greater than 25% of GDP/GSDP is considered a strong sign, indicating robust investment in capital formation for future revenue and growth. 

Rajasthan's GFCF at 29.53% significantly surpasses this benchmark, signaling a very positive outlook for the state's economy.

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