Bengal`s revenue behind national average: RBI study
Follow us Now on Telegram ! Get daily 10 - 12 important updates on Business, Finance and Investment. Join our Telegram Channel
West Bengal is behind the national average in terms of state’s own revenue or gross state domestic product (GSDP) percentage, as per the recent findings of the Reserve Bank of India (RBI) on state finances.
Both in terms of state’s own tax revenue and the non-tax revenue, as per the RBI findings, West Bengal is behind the national average.
According to it, the percentage of state’s own tax revenue of the GSDP for West Bengal is just five per cent which is lower than the national average seven per cent.
The situation in case of non-tax revenue is more pathetic as regards West Bengal. As per the findings, the percentage of state’s non-tax revenue of the GSDP for West Bengal is just 0.4 per cent which is lower than the national average 1.2 per cent.
As per the RBI findings, the state government’s current spending for infrastructure development as a percentage of GSDP is just two per cent.
Economists are of the opinion that following this factor is fallout of the heavily state excise-dependent state’s own tax revenue structure in West Bengal. According to them, a healthy state’s own tax revenue component in any state is dependent much on big-ticket investment both in the manufacturing as well as the services sector.
This is exactly the area where West Bengal is lagging behind other major states and economists are of the opinion that the state’s internal policies as regards to land procurement and granting of special economic zone (SEZ) status, are mainly responsible for the drought in big ticket investment.
Economists feel, West Bengal government’s policy on “no state-role in land procurement for industry” is making the operators in manufacturing sectors averse towards making investment in the state. Considering the fragmented land-holding nature in West Bengal, it is virtually impossible for investors requiring huge plots of land at one-go for a project to interact with individual land-owners for the purpose of land purchase without any kind of state intervention in the process.
Similarly, economists say, it is the West Bengal government’s reluctance to grant fresh SEZ status in the state, that big ticket investers in the services sectoris ark shying away from investments.
