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Will West Bengal lose its masochistic streak?

Will West Bengal lose its masochistic streak?
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First Published: Wed, Mar 23 2011. 01 15 AM IST
Updated: Sat, Jul 02 2011. 05 47 PM IST
After 33 years, there’s a good chance the CPM, and its fig leaf, the Left Front, may be in for a drubbing in the West Bengal elections round the corner. It’s an occasion to look back at the state government’s disastrous track record and to shake one’s head with wonder at the deep masochistic streak in the people of the state that has led them to vote the Communists back into power time after time.
Look, for example, at the state GDP numbers. According to the Central Statistical Organisation’s (CSO) figures, West Bengal accounted for 7.8% of the country’s gross domestic product (GDP) in 1980-81, three years after the Left came to power. By 2009-10, the state’s share had fallen to 6.5%. I’m tempted to contrast that record with that of Tamil Nadu, a state known to be corruption-ridden and fond of electing people from its film industry. Well, Tamil Nadu’s share of the country’s GDP has gone up from 6.1% in 1980-81 to 7.6% by 2009-10. Maybe West Bengal would have done better if it had elected the late Uttam Kumar or Aparna Sen as chief ministers!
The per capita numbers tell a similarly despondent story. In 1980-81, West Bengal’s per capital income at current prices was Rs1,773, according to the CSO. That was slightly less than the national average of Rs1,784, 0.6% less, to be precise. By 2009-10, the state’s per capital income at current prices was Rs41,469, well below the national average of Rs46,492. This time, it’s 11% less.
Reserve Bank of India (RBI) data are usually far more reliable than the data on national income compiled by the states, which may also not be comparable. So let’s look at the numbers on bank credit. RBI data tell us that in June 1978, bank credit utilized in West Bengal was 9.8% of the all-India figure. By March 2009, it had fallen to 5%. With economic activity slowing down, it’s rather obvious that credit growth too would slow.
What about bank deposits, which could serve as an indicator of how rich a state is? Well, West Bengal’s share of total bank deposits in the country was 11.7% in June 1978. By March 2009, its share was down to 5.8%, again according to RBI data.
Kolkata used to be the third largest city in terms of bank deposits in the country, after Mumbai and Delhi, as late as 1998. It accounted for 4% of all-India bank deposits then. By 2010, it had dropped to fourth place, with Bangalore overtaking it and Chennai breathing down its neck. Its share of all-India bank deposits had fallen to 3%. On the credit front, Kolkata fares even worse, having gone down from fourth to sixth place between 1998 and 2010. Mumbai, Delhi, Chennai, Bangalore and Hyderabad now account for a larger share of bank credit than Kolkata.
As for the state’s industrialization, the less said the better. Even during the last half of the Left Front’s rule, the share of industry has fallen precipitously. Here are the numbers from RBI’s Handbook of Statistics: in 1993-94, industry (which includes mining and electricity generation) was 17.9% of the state’s net national product; in 2008-09, it was 9%.
What about employment? An International Monetary Fund paper with the title “Mind the Gap—Is Economic Growth in India Leaving Some States Behind?”quoted Indian labour ministry numbers on employment between 1970-71 and 2001-02 to show that employment growth in West Bengal over the period in the organized sector was zero.
But perhaps while the CPM government’s head may be muddled, its heart is in the right place? Has it concentrated on human development instead of making a fetish of GDP? The West Bengal government’s own candid assessment of its performance in its Human Development Report, 2004 may have revealed more than it intended. This is what it had to say: “In terms of the more obvious indicators of human development, the state is somewhere in the middle of all Indian states.” Here are some more excerpts: “In terms of basic household amenities, West Bengal’s performance tends to be lower than the national average”; “electrification has proceeded more slowly than the rest of India”; “health indicators suggest a very mixed performance”; and finally, “literacy and education indicators are well below what could be expected given the social and political orientation of the state government”. Rather damning, that last bit, right?
In the national Human Development Report of 2001, the state was ranked eighth in 1981, 1991 and in 2001 among the 15 states considered for the index. To contrast with Tamil Nadu again—the southern state ranked seventh in 1981, third in 1991 and retained that rank in 2001.
So there we have the government’s performance in hard, cold numbers. Whether Mamata Banerjee will do better if her party wins is another matter. The advantage she has is that one can scarcely do worse.
Manas Chakravarty looks at trends and issues in the financial markets. Comment at capitalaccount@livemint.com
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First Published: Wed, Mar 23 2011. 01 15 AM IST