Frustrated with the Centre for not yielding to West Bengal’s various demands, including a financial package, Chief Minister Mamata Banerjee today said she had done everything possible short of beating up the prime minister.
“In 2010, 2011 and 2012, I met the prime minister 10 times (for central aid). I cannot do anything more than this. Should I beat him up? If I do, then you will say I have become a goon. I will be called a goon for doing nothing. However, I do not care about that. For people, I can take the last step,” Banerjee said at a public meeting.
Banerjee also strongly condemned the Centre’s decision to increase urea prices. The state would set up its own urea factory to offset the dependence on the Centre, she said.
Following the Cabinet Committee on Economic Affairs (CCEA)’s October 11 decision, the Cabinet had decided to increase prices of urea-based fertilisers by Rs 50 a tonne.
“It is very distressing to know that prices of fertilisers have been further increased. I have lost count of the number of times the prices of fertilisers have been increased during the UPA-II regime. The increase in fertiliser prices will affect the poor farmers and also the common people. I strongly condemn this price rise,” Banerjee had earlier posted on Facebook.
Finances deteriorate
The continual deterioration in the already poor finances of Bengal have again been highlighted in a recent Reserve Bank of India (RBI) report — State Finances: Study of Budgets, 2012-13.
West Bengal continued to remain last or in the last three in terms of the financial health of states. The ratio of revenue receipts to Gross State Domestic Product (GSDP), revised estimates, in 2011-12 was the lowest in West Bengal among all states, at 10.80 per cent.
West Bengal had the highest revenue deficit to gross fiscal deficit in 2011-12 (revised estimates) at 79.70 per cent. The state had the highest ratio of interest payment to revenue expenditure in 2011-12 at 21.10 per cent among states.
The bleak state of finances was highlighted by high non-development expenditure, combined with high debt. West Bengal has the second highest debt to GSDP ratio at around 39 per cent, according to the 2011-12 revised estimates (RE), said the RBI report.
By the end of March 2013, West Bengal’s outstanding liabilities would be Rs 2.30 lakh crore, the third highest among all states.
In 2011-12 (RE), all states were able to contain their interest payment to revenue receipt ratio (IP-RR) to 15 per cent, except Gujarat, Kerala, West Bengal and Punjab. West Bengal had the highest IP-RR ratio at 27.20 per cent, with Chhattisgarh recording the lowest at 4.5 per cent.
The average committed expenditure during 2010-11 to 2012-13 in the three chronic deficit states of Kerala, Punjab and West Bengal accounted for 41.30 per cent, 47.60 per cent and 50 per cent, respectively of the revenue receipts.
According to the state budget document, this financial year, West Bengal’s revenue receipt is projected to be Rs 76,943 crore and expenditure is Rs 83,801 crore, leaving a huge revenue deficit of Rs 6,585 crore.
West Bengal’s expense on salaries alone is set to increase from Rs 28,899 crore to Rs 31,184 crore by the end of this financial year, 37 per cent of the projected expenditure. The cost of pension and other retirement benefits is projected to increase from Rs 8,385 crore to Rs 9,582 crore. The only silver lining the RBI report offers is the optimistic target set by the state government on improvement of fiscal situation in the 2012-13 Budget estimates.
Reduction in revenue deficit in West Bengal, and increase in revenue surplus in Bihar, contributed to the budgeted improvement in the consolidated revenue account of the non-special category states, the RBI report says.
In 2012-13, West Bengal’s revenue deficit to GSDP, stood at 1.1 per cent (budget estimates), against an optimistic number of 3.1 per cent in 2011-12 (RE).
Mamata’s sops continue
Even as Bengal has been facing an acute financial crisis, with market debt limit almost exhausted, the chief minister has continued with populist measures.
Recently, Banerjee embarked on a second round of a fund distribution spree to local clubs in the state, while assuring a steady flow of funds to them over the next five years.
