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The present study attempts an assessment of districts in Uttar Pradesh in terms of their productive capacities and potential for structural transformation. A composite index of district-level productive capacities is constructed using a two-step methodology based on aggregation of five subindices that are constructed using Principal Component Analysis and using district-level data on 32 variables that cover five dimensions encompassing sectoral resources and infrastructural linkages that enhance productive capacities. The results indicate significant disparities in productive capacities across districts by quintile groups and regions. Many districts in Eastern and Bundelkhand region have low productive capacities in comparison with districts in Western and Central regions of Uttar Pradesh. The results also show positive and significant correlations between the constructed district capacity index and district-level indicators namely per capita net domestic product and district share in net domestic product indicating that enhancing productive capacities is crucial for development. The constructed subindices are useful in identifying the relative strengths and weaknesses of districts in the five dimensions and indicate the scope and underlying potential for transformation. District and region-specific policies that focus on diversifying productive capacities can spur economic growth and reduce regional disparities.
Padma Suresh Mandala (Sun,) studied this question.
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