03 July 2005

Agrarian Question in India III

Contradictory Trends in the W.Bengal Economy
According to statistics released by the government of India, average increase in domestic product for the last 10 years has been highest in West Bengal. A 7.1% annual rise of domestic product for West Bengal is ahead of Karnataka's 6.4%, Gujarat's 6.1% or Haryana's 5.8%. The average income in W. Bengal has grown at a rate of 5.5% in the same decade, the fastest in India. Farm output in W. Bengal has increased at a rate of 5% in the past year, again the fastest in India.West Bengal's employment growth has been less spectacular.

Only 70, 000 jobs were created in that state through 1991-2004 following liberalization and privatization. The same statistical data puts the amount of private industrial investment flowing to West Bengal at 27,000 crore rupees in the 13 year period. In contrast, Gujarat created 1,40,000 new jobs with almost the same amount of new private capital inflow and Maharashtra added 1,50,000 new jobs with less new private capital inflow. Government statistics puts the current number of unemployed in West Bengal at 7 million. The pattern of investments have been capital intensive and according officials, some new investors have even imported captive workers from other states and kept them within factory walls, "even chaiwallas outside these plants do not get any business because the workers can't come out."

According to West Bengal's finance minister, Mr. Asim Dasgupta, rural West Bengal spent 17,000 crore rupees in 2004 on non-farm goods and services, driving new consumer product companies to spring up. Urban consumption has also risen. Kolkata boasts to have India's largest Pizza Hut franchise and top-ranked Sony world franchise. The government is on a drive to attract even more investment from domestic and foreign capital to build new malls, airports and other infrastructure. According to government leaders, economic investments have been driven by consumer demands, especially rural demands. They point out that tillers in West Bengal own 80% of the farm land, compared to 85% of the tillers owning only 33% of the farmland on an all-India basis. This has led to high gains in land productivity and consuming power of the tillers. Grain production has given way to rising production of vegetables, potatoes, mangoes, pineapples etc. Cold storage facilities and transport facilities to store and move fruits and vegetables efficiently is attracting investments from food processing industries like Pepsi, Dabur and other firms.

West Bengal's leaders are hoping to develop West Bengal's industry and economy to be a hub to service Bihar, Jharkhand, Orissa, the north eastern states and even Myanmar, Bangladesh, South-East Asia and China - a sort of India's gateway to the Far East and China. It is a dream to repeat Robert Clive's road-map to conquer India and Asia from Kolkatta, still on the basis of rural Bengal! The irony is that colonialism created the working class who, together with farmers and peasants, is destined to shape that future.


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