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The Government of West Bengal (WB) held a Business & Industry Conclave on December 18. This was a relatively new format, as state-based organisations were invited to present the status of their investments and business activities. The conclave also featured multilateral round table discussions involving business leaders and government representatives. A representative from the World Bank and a few foreign investors currently operating in the state were also present. Compared to the Global Business Summits organised by the state in earlier years, this conclave was modest in scale, with less emphasis on spectacle and glamour.

In the larger summits, most of the country’s leading industrialists and many foreign business leaders participate to assess the state’s business climate. Several memorandums of understanding (MoUs) are signed for prospective investments. However, it is widely debated that such high-profile summits often involve substantial expenditure, while only a small proportion of the MoUs eventually translate into actual investments. At the same time, one must consider the present context, where private capital formation and private investment are already subdued across India. Even in more developed states, realised investments constitute only a small fraction of the proposals announced at business summits. Against this backdrop, the recent Business Conclave appears to be a more effective and grounded initiative.

At the conclave, several industrialists presented details of their ongoing investment activities and outlined future investment plans in the state. Almost all participants expressed satisfaction with the business environment in West Bengal and appreciated the cooperation extended by the government in facilitating their operations.

West Bengal’s Economic Performance Over the Years

A long-term view of the state’s economy reveals a clear downward trajectory. West Bengal, which was at the forefront at the time of Independence, slipped to the third position by 1960–61. The state’s share in national GDP was 10.5% in 1960–61, but this declined sharply to 5.6% in 2023–24. Per capita income in the state was the highest in the country immediately after Independence and remained above the national average until 1960–61, at around 127% of the national level. However, this relative advantage could not be sustained. By 2023–24, West Bengal’s per capita income had fallen to 83.7% of the national average, placing it below even some traditionally poorer states such as Odisha and Rajasthan.

Recent Growth of SGDP in West Bengal

The state’s total GDP stood at ₹18.8 lakh crore. An examination of SGDP growth over recent years shows that West Bengal recorded a contraction of 7.58% during the pandemic. This was followed by a strong recovery in 2021–22, when growth reached 11.64%. In 2022–23, SGDP growth moderated to 5.76%, and in 2023–24 it increased slightly to 6.09%. The state budget estimated SGDP growth at 6.80% for 2023–24.

Financial Position

Dev Kar, Chief Economist Emeritus at Global Financial Integrity and a fellow at Yale University, citing an Economic Advisory Council study and the NITI Aayog Fiscal Health Index 2025, noted (The Wire, April 2025) that West Bengal’s revenue generation has lagged behind that of several southern and western states. However, the state has made efforts to improve its fiscal position.

Data indicate that in 2010–11, the fiscal deficit stood at ₹19,534 crore, amounting to 4.24% of SGDP. This gradually declined to around 3% of SGDP by 2018–19. The deficit

rose again during the Covid-19 period due to higher expenditure, reaching 3.91% of SGDP, before declining to 3.26% by the end of 2022–23. The debt and interest payment burden has also shown a downward trend over time. The debt-to-SGDP ratio declined from 40.65% in 2010–11 to 37.08% in 2023–24. Nevertheless, in absolute terms, the state’s debt remains high, placing West Bengal among the five mostdebt-burdened states in the country.

The interest payment burden declined from 58.77% to 46.64% of total revenue between 2010–11 and 2023–24.

However, it is important to note that comparisons of state finances before and after 2010–11 may not fully capture underlying realities, as changes in the approach adopted by successive Finance Commissions have altered the revenue structure of states over time.

The Government of West Bengal has been allocating substantial resources toward social transfers, which have provided relief to a large population of poor households in the state. Available data suggest that these expenditureshave not adversely affected fiscal deficits, debt levels, or capital expenditure.