Here’s A Look At The ‘Bengal Model’ That Mamata Banerjee Is Touting As An Alternative To Modi’s Development Agenda
Mounting debt, unemployment, and a crumbling law and order system—the 'Bengal model' has a lot to answer for before the rest of India can even consider it as an alternative.
Trinamool chief Mamata Banerjee has, after sweeping the recent Assembly polls in Bengal, been touting a ‘Bengal model’ of development as an alternative to the ‘Gujarat model’.
She trumpeted this so-called ‘Bengal model’ during her much-publicised address on Wednesday (21 July). While failing to outline even the basic parameters of her ‘model’, she only said that it involved direct cash transfers to the poor to boost consumption and, hence, the economy.
While direct cash transfers to the poor is hardly her brainchild--and she had been opposing such transfers from the Union government to beneficiaries of many central schemes, especially farmers--it remains a fact that such transfers (from the state’s coffers) have been mired in irregularities and allegations of favouritism and corruption.
In the absence of any clarity on what exactly is the ‘Bengal model’--discounting the vague terms like ‘peace, prosperity, unity and harmony’ that the Trinamool chief used to describe her ‘model’--it would be worthwhile to take a quick look at how Bengal has fared under her rule over the past decade.
The state’s economy
Bengal, as any economist will vouch for, is on the throes of a severe debt trap. The state’s total outstanding debt as on 31 March 2021, was Rs 3,36,757 crore; this will increase to Rs 5.35 lakh crore by the end of the current fiscal.
The outstanding debt on 31 March 2021, is more than the state’s current budget outlay of Rs 3,08,727 crore. The state’s revenue generation target for 2021-2022, albeit a highly ambitious one, is Rs 75,415 crore.
Bengal’s accumulated debt burden on 31 March 2012, was Rs 2,08,382.58 crore. Mamata Banerjee came to power in the state in May 2011 and almost all that debt was a legacy of the 34 years of Left misrule.
But Banerjee, through financial mismanagement, profligacy and inability to get fresh investments into the state, has taken Bengal deeper into the red. Over the past one decade, the state’s debt burden has increased by Rs 1,28,375 crore.
By the end of the current financial year--31 March 2022--Bengal’s debt burden would have increased by Rs 3.26 lakh crore over the debt burden exactly ten years ago (March 31, 2012). This is a 156 per cent increase and, in effect, means that Mamata Banerjee has increased Bengal’s debt burden by 2.5 times over the last ten years.
In other words, Mamata Banerjee more than doubled the state’s debt burden in ten years over what the Left Front had accumulated over a period of 34 years.
Of the projected revenue earnings of Rs 75,415.71 crore in the current fiscal, state GST is projected to yield Rs 32,981 crore. The second largest revenue earner is excise collections projected at Rs 16,100 crore.
The estimate for excise collections has been increased by 40 per cent from the earlier estimate of Rs 11,458 crore. Excise collections are the second largest revenue generator for the state.
That, indeed, is shameful and only attests to the poor state of Bengal’s finances. That Bengal banks heavily on its citizens drinking more and more to pay salaries to its employees and fund other expenses is something the government should be ashamed of.
A quick comparison with Gujarat (a state Banerjee loves to deride) would be in order here: Gujarat is a dry state and has zero collections from liquor. Gujarat, of course, is a revenue surplus state while Bengal is a revenue deficit state.
Economists say that Bengal’s dependence on market borrowings and excise collections to fund its expenditure will continue. Most of this is revenue expenditure and not capital expenditure that results in asset creation.
Over the next five years, Bengal is sure to go deeper into the red as Mamata Banerjee is bound to roll out more doles to remain in power even as the state will continue to remain an unattractive destination for investors.
Financial opacity and corruption
Mamata Banerjee never tires of complaining that Bengal is not getting its due in terms of financial assistance from the Union Government.
She said in the state Assembly last week that Bengal has been “denied dues in terms of devolution of tax shares and grants”. The Centre, she alleged, “deprived Bengal of Rs 25,225 crore in the last two financial years”.
Bengal, she elaborated, got Rs 14,225 crore less (than the Rs 58,952.55 crore) mentioned in the 2020-21 Union Budget and Rs 11,000 crore less in 2019-2020. These are apart from the Rs 33,314 crore that the Centre reportedly owes to Bengal with regard to centrally sponsored schemes.
However, what Banerjee fails to state is that Bengal’s refusal to submit utilisation certificates for centrally sponsored schemes and give proper statement of accounts, as well as its refusal to open its books for audit by the Accountant General (AG), has led to the Centre withholding funds.
Despite repeated reminders and requests from the Union Government, the state has failed to submit utilisation certificates for funds sanctioned by the Centre for centrally-sponsored schemes. It has not allowed its books to be audited by the AG for the past few years.
This had raised suspicions of large-scale defalcation of funds and corruption. It comes as no surprise, then, that the Union Government has withheld funds. Bengal is the only state in the country which has painted itself into an ignominious corner of financial opacity and impropriety.
Law and order
It is well-known by now that Bengal fares very poorly as far as law and order is concerned. Though it has not sent its crime statistics to the National Crime Records Bureau (NCRB), there is no hiding the fact that Bengal is among the top states in crimes against women, murders, human trafficking and extortions.
What makes the situation (for the common citizenry) worse in Bengal is the complete politicisation of the police force as well as the state machinery. The police and the civil administration, acting as handmaidens of the ruling Trinamool, do not offer any protection to the common folks from the depredations of Trinamool cadres and goons.
Bengal’s decades-old legacy of political violence--violence perpetrated on workers and supporters of opposition parties by goons of the ruling party--has been shameful. But it has become much worse over the past ten years since the Trinamool came to power, and has become particularly acute since the results of the recent Assembly elections were announced on 2 May.
As the NHRC team tasked by the Calcutta High Court to probe post-poll violence in the state has rightly noted, it is the ‘law of the ruler rather than the rule of the law’ that prevails in Bengal now.
Such a state of affairs makes Bengal a dangerous place to live in and definitely not a state conducive for investments.
Unemployment, brain drain and doles
According to CMIE statistics, the unemployment rate in Bengal is one of the highest among all states of the country at 22.1 per cent. The national average is 7.2 per cent.
Economists say that the figure for Bengal will actually be much higher given the fact that the state is in the habit of fudging figures to paint a rosy picture of itself. The unemployment figure in Bengal would actually be over 30 per cent.
That means nearly a third of the state’s workforce is unemployed. Add to that endemic under-employment where even post-graduates and those with technical degrees work as sales representatives or delivery agents.
This lack of employment forces tens of thousands of young men and women to migrate to other states in search of employment. Bengal has become one of the largest contributors of the unskilled and semi-skilled workforce in the country.
A huge percentage of the labour force in states like Haryana, Rajasthan, Gujarat, Punjab, Maharashtra, Delhi and the southern states comprises migrants from Bengal. Most househelps in Delhi, Gurugram, Noida and Ghaziabad, not to speak of Mumbai and many other cities across the country, are from Bengal.
There are sparse employment opportunities in Bengal even for skilled and highly-skilled workers. Most engineers and others with technical degrees go to technology hubs like Bengaluru to get jobs.
Bengal’s economy has been hobbled by the absence of investments in the manufacturing sector where many existing units are ailing and most are struggling to stay afloat. This has forced lakhs of people into subsistence employment or self-employment: running small food stalls, pulling rickshaws or driving auto-rickshaws and working in small and micro enterprises at pathetic wages.
All this has led Mamata Banerjee to resort to doles to keep the masses on her side. But these doles are also mired in many controversies: allegiance to the ruling party is a prerequisite for getting the doles, allegations of corruption and siphoning of funds are widespread and very often, the doles reach ghost recipients instead of the intended beneficiaries.
Politicisation of academic institutions and academia has resulted in a dismal fall in academic standards. This has resulted in Bengal’s best and brightest migrating to other states for quality education. This brain drain starts right from the school level and intensifies at the under-graduate level.
Endemic corruption, ‘syndicate raj’, ‘cut money’ and extortions
Corruption is endemic in Bengal and, since the days of Left Front rule in the state, has been accorded political patronage.
The state’s bureaucracy is notorious for its lethargy and poor work culture. And that is mostly the direct result of the politicisation of the state administrative machinery--political patronage to state government employees’ unions provides leaders and members of these unions immunity from disciplinary action in case of lapses and embolden them to shirk work.
Thus, very little work gets done in state government offices and this is a huge stumbling block that dissuades investors from coming into the state.
In the absence of proper employment opportunities, a huge number of young and middle-aged men sustain themselves through extortions (mostly petty) and ‘syndicates’. They are patronised by (Trinamool) politicians who often use them as musclemen to browbeat opposition workers and supporters.
All this has vitiated the social and economic climate in Bengal. True, this has been the situation since the Left came to power in the state, but the situation has deteriorated over the past decade since the Trinamool came to power in Bengal.
This, then, is the Bengal ‘model’ that Mamata Banerjee has been touting as an alternative to the Gujarat model of development. The so-called ‘Bengal model’ is, in fact, a ‘model’ that, being a sure-shot recipe for disaster, should be shunned by the rest of India.
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