Regional Disparities in Per Capita GSDP/NSDP in the Seven Sister States in India: Convergence and Divergence

Abstract

The main theme of the 12th five-year plan (2012-17) is faster, sustainable, and more inclusive growth, but the regional disparities have broadened significantly in the recent decades, and there is weak evidence of convergence. This study attempted to probe this question by analyzing the (GSDP) per capita income in the Seven Sister States in North East India during the period of the first decade of the 21st century by estimating the convergence and divergence. Regional disparities in the gross state domestic product have widened much more significantly, but there is weak evidence of conditional convergence controlling for some variables as an inverse relationship was found between average state expenditure of GSDP and CAGR per capita growth. The study results showed that agriculture growth is positively interrelated and is not significant to the compound annual growth rate of per capita gross state domestic product. The study showed that the Seven Sister States experienced a degree of convergence in the per capita GSDP during the period from 1999/00 (coefficient of variation : 0.0114), but during the 2010/11 period, the coefficient of variation increased (coefficient of variation : 0.0172). Therefore, divergence was also found to have increased continuously in these states. In contrast, groups' wise coefficient of variation decreased considerably for per capita NSDP.