Once a major contributor to India's GDP, Bengal's economic decline concerning: Report

A recent working paper from the Economic Advisory Council to the Prime Minister (EAC-PM) has shed light on significant disparities in the economic performance of Indian states, highlighting a notable decline in West Bengal's economic standing.

According to the report, while southern states like Karnataka, Andhra Pradesh, Telangana, Kerala, and Tamil Nadu have emerged as major contributors to India's GDP, West Bengal has experienced a puzzling economic decline which is concerning.

In 1960-61, West Bengal was a major contributor to India's GDP with a share of 10.5%. However, this contribution has dwindled to just 5.6% in recent years. The state's per capita income, which was 127.5% of the national average, has fallen to 83.7%, placing it below states like Rajasthan and Odisha, which have traditionally been less economically advanced.

The report notes that West Bengal has experienced a continuous decline in its economic performance over several decades. Despite its strategic maritime location and historical advantages, the state's economic trajectory has been one of steady deterioration.

Experts find the state's decline perplexing, especially considering the prosperity of other maritime states. The working paper highlights West Bengal as an anomaly, given that most maritime states have thrived economically.

The question of what went wrong in West Bengal, particularly with its industrial policies, has been a subject of debate. The state’s political climate, which shifted drastically after liberalization, may have played a role in its economic stagnation.

The report also highlights the challenges faced by the poorest states. Uttar Pradesh, once contributing 14% of India’s GDP in 1960-61, now accounts for 9.5%. Bihar, despite being the third-most populous state, contributes only 4.3% to the national economy. While Odisha has shown marked improvement, shedding its image as a laggard, Bihar remains far behind other states in terms of economic growth.