India’s mining sector witnessed a marked fall in output during 2000s on account of country’s rising dependence on crude oil imports. The Reserve Bank of India (RBI) report, which is based on trends in output growth and labour productivity growth during 1980-2008 in six broad sectors, has highlighted that the output of mining sector has declined during the period 2000-2008 as increased domestic demand for crude oil was being met trough the imports rather than domestic production.
Further, the RBI’s report noted that the sector like agriculture, mining and quarrying witnessed decline in productivity during period 2000-2008 as compared to period 1980-1999. However, there has been a revival of productivity growth in many industries since 2000. Sectors such as manufacturing, electricity, gas & power and services showed improvements in total factor productivity (TFP), the report added. The growth of manufacturing sector stood at 6.13 percent per annum during the period under study.
The report further highlighted that the gross value added (GVA), which is the value of output minus the value of intermediate inputs, rose by about 2 percentage points between 1980-99 and 2000-08, showing a rise to 7.6 percent per annum during 2000-08 from 5.2% per annum during 1980-99. The broad sector such as manufacturing, construction and services experienced acceleration in value added growth rate between 2000 and 2008. Among these three sectors, construction sector showed high acceleration in value added growth with trend growth rate in real gross value added of construction increasing from 4.7% per annum during 1980-99 to close to 10% per annum from 2000- 08. Further, the report also found that during the period 1980-2008, the growth in persons employed was driven mainly by construction and the services sectors.