Total factor productivity in manufacturing sector of Bihar: With a special reference to tobacco industry

Abstract

India has an impressive and progressive profile in the global tobacco industry and it is an important commercial crop grown here. India is the second-largest tobacco producer and exporter in the world. Total exports of manufactured and unmanufactured tobacco stood at US$ 934.23 million in 2017-18 and US$ 564.28 million between Apr-Oct 2018. Indian tobacco is exported to about 100 countries. The development of manufacturing sector of an economy is an indicator of the economic strength of that country by raising productivity, employment generation along with supporting various other sectors of the economy. This study covers the duration of 1998-99 to 2012-13. Depending upon the availability of data the latest years have been added. This study is proposed to cover the Tobacco industry in state Bihar indicated by Annual Survey of Industries. Malmquist, Tornquist and Solow Index technique have been used to calculate TFP in tobacco industry of state Bihar, India. The productivity trend of tobacco industry in state Bihar had shown a steady growth pattern. TFP was maximum in year 2007-08 and was lowest in year 2006-07. TFP growth rate had shown a steady growth pattern from 2001-02 to 2005-06 and 2008-09 to 2011 with 2 major downfalls in TFP during 2006-07 and 2012-13.