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Mohan Padmanabhan

Mr N.K. Singh (right), Member of the Planning Commission, being greeted by Mr Sanjay Bhudhia (left) and Mr Dipankar Chatterjee, Deputy Chairman and Chairman respectively of CII (Eastern Region), before an interactive session with CII members in Kolkata on Wednesday.

KOLKATA, May 1

SEEN from the perspective of any conceivable index of economic development, such as power consumption, telecom density or a weighted infrastructure index, the three large eastern States - West Bengal, Bihar and Orissa - have lagged behind the rest of India, and this is a worrying factor. India moves forward in the Human Development Index pole, but in a divided way, and this is not acceptable.

Addressing members of Confederation of Indian Industry (Eastern Region) at an interactive session on `Regional imbalances in the overall economic scenario' here today, Mr N.K. Singh, Member, Planning Commission, said that in order to correct such imbalances, which tend to be a major drag on the nation's economic resources, the Planning Commission would devise innovative schemes and projects in the Tenth Plan (2002-2007) to allow these States to become part of the mainstream.

Both through public-led investment, and greater availability of resources, we intend to devise special schemes for these large States, which have been victims of "neglect,'' he pointed out.

He said that if we have to achieve a sustained 8-9 per cent GDP growth in the 10th Plan period, these States have to catch up with the rest. Stating that the Union Government may be held partly responsible for this "endemic neglect,'' he felt that business and industry too cannot escape responsibility, as they have not been very demanding on bankable projects, and have to find answers for such poor development within a set timeframe.

The growing regional divide, he felt, was indeed a worrying factor for the planners. Going into the genesis of such regional imbalances, despite having strong macro-fundamentals, he said as a percentage of investment proposals by financial institutions all over the country in the last 15 years, West Bengal's share would be a meagre 2.3 per cent, with Bihar and Orissa getting 1.2 per cent and 2.2 per cent respectively.

And if we go by the percentage share of disbursals by FIs, while Bengal got 3.9 per cent, Bihar and Orissa got 1.4 per cent and 1.8 per cent respectively.

Analysing some of the other contributory factors, besides availability of finance and credit, he said wholesale inadequacies could be seen in areas like infrastructure, fiscal scenario and quality of governance. Blaming bulk of the problems on the stretched fiscal situation in all the three states of Bengal, Bihar and Orissa, he said additionality of resources alone may not be the answer.

Expressing concern on the fiscal front, where higher expenditure has to be met through increased borrowings, he said the per capita expenditure in these states has come down as a result of zero asset creation acitivities. Dwelling on the advantages of a state like West Bengal, which prides itself on its intellectual capital, he suggested that stress should be on the services sector so that Bengal can once again emerge as the nation's centre of learning and educational excellence.

The state also needs to go up the chain on the infrastructure index, mainly power and roads, besides labour reform. And above all, Bengal has to address this problem of image, to make the state an attractive destination for investment.

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