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May 25, 2016

In conversation with Dr Amit Mitra

In conversation with Dr Amit Mitra

How can this mandate be explained?

The main reason is the massive development of social and physical infrastructure. Before 2010-2011, plan expenditure (PE) was Rs 14,161 crore, which increased to Rs 53,100 crore in 2015-16. Growth in PE in 2010-11 was minus 2.3 per cent; in 2014-15, the growth was 61.9 per cent over 2013-14. And, if you look at asset-creating capital expenditure, it was Rs 2,225 crore in 2010-11, lower by 26 per cent over the previous year. In 2014-15, that figure was Rs 13,374 crore, growth of six times. This has gone in building roads, schools, colleges, water works. So, it’s not only talk.

But, while plan and capital expenditure have grown phenomenally, we have also maintained fiscal discipline. In 2010-11, the fiscal deficit as a proportion of Gross State Domestic Product (GSDP) was 4.24 per cent; in the 2015-16 revised estimates (RE), it is 2.11 per cent. The revenue deficit as a percentage of GSDP in 2010-11 was 3.75 per cent; in the 2015-16 RE, it was 0.42 per cent. The debt to GSDP ratio was 40.65 per cent in 2010. In 2015-16, it stood at 33.14 per cent. It is still one of the largest ratios in the country.

How much have you borrowed?

Rs 1.13 lakh crore, of which Rs 94,000 crore has gone into servicing debt of the past.

What are the contours of development?

Rural development expenditure has grown by five times. During 2006-11, it was Rs 7,628 crore; in 2011-2016, it increased to Rs 38,214 crore. This is where the rural votes are coming from. Expen-diture on health has grown from Rs 3,139 crore in 2006-2011 to Rs 10,000 crore in 2011-2016. On education, from Rs 8,000 crore to Rs 22,000 crore; on minorities, from Rs 1,031 crore to Rs 5,526 crore. We have set up 170 new ITIs (industrial training institutes) and 81 polytechnics in these four and a half years. Primary and upper primary schools have grown by 6,000. Forty-six additional colleges have come up and 15 new universities, of which seven are government ones.

Where are the resources coming from?

Our (annual) tax collection has increased from Rs 21,000 crore to Rs 40,000 crore.

What after this?

Mamata Banerjee will decide. After the cabinet is formed, she will sit with her colleagues and the (government) secretaries, and set the agenda. What has happened in social infrastructure is still work in progress, as nothing has happened in the past 34 years. All the things in the manifesto, like health, education, will have to go further, deeper. As far as servicing the urban population is concerned, everyone would agree that Kolkata is much cleaner. Plus, we have continuous power. Roads are better, flyovers have come up and so, traffic movement has eased, and there is steady water supply.

What can business look forward to?

The scale at which the Bengal Global Business Summit has been held has never been seen before. In 2015, we got investment proposals of Rs 2.45 lakh crore, of which Rs 93,000 crore is under process. In 2016, we got investment proposals of Rs 2.5 lakh crore, which are under consideration. Since we came to office, investment of Rs 87,000 crore has been completed. Bank lending to the micro, small and medium sectors has increased three-fold, from Rs 32,384 crore to Rs 91,572 crore. So, small and medium industries are growing.

Is that enough?

Certainly not. More will happen. Large industries will also come. We have 5,000 acres with the West Bengal Industrial Development Corporation, in 23 parks. New parks are coming up, too. There is a new momentum in the cement sector. JSW is building a plant, so is Emami. Shree Cement has also expressed interest. Among larger industries, Tata Metaliks has asked for 300 acres for expansion, which will be in Kharagpur. Tata Hitachi has brought in three subsidiaries from Japan. Food processing is also a huge area.

Is this mandate a disincentive to review some of your earlier policies, like special economic zones?

It is very clear in the manifesto we will not accept SEZs that foster crony capitalism. The Centre’s own studies are now saying that SEZs have not served the purpose.


Excerpts from an interview with The Business Standard, first published on 20th May, 2016