MR. SPEAKER SIR,
With your permission, I rise to present the Budget and the
Annual Financial Statement for the year 2008-09.
1
1.1 While presenting this Budget, we have tried to focus attention
on the major socio-economic concerns of the common people of the
entire country, and as a part of that, specially of West Bengal. Even
within the existing State structure, these concerns are about the
need to increase employment generation to the maximum extent
possible and, through that, increase income for reducing poverty.
Keeping this main concern and objective in view, the policy should
not be one of only increasing the level of production, but be
directed towards increasing production and expansion of services
in such a manner that will lead to employment generation as far as
possible. This employment-oriented expansion of production and
services will be possible when, in our view, there is also a lessening
of monopoly power and a move towards more equal competition in
different spheres of production and services. For this move to be
effective, there is also a concurrent need for increasing the
empowerment of common people in terms of land, capital,
education and health. There is also a simultaneous need for
improving the infrastructural facilities, so that the common
producers and service-providers can have access to these facilities.
At the same time, it is also essential to control the rate of inflation
in order that the real income of common people can be protected.
For turning the policy towards employment-oriented growth with
control of inflation and empowerment of people, it is specially
important that the common people should participate in the entire
process of decision-making and implementation.
1.2 The task of implementing the policy for redressing these
major problems of common people in a State like West Bengal
becomes specially difficult when a different kind of policy is
adopted for the country from the level of Central Government.
Honourable Members, it is only relevant to mention here that over
the last about 17 years, a special kind of policy—a one-sided IMFWTO
guided policy of globalisation and liberalisation—has been
2
followed from our national level. As a consequence of following this
policy, none of the major problems of common people has been
resolved. Moreover, several of the problems—unemployment, loss of
self-reliance in foodgrains, inflation, instability in our financial
sphere arising out of dependence on the First World countries and
assault on the decision-making power of the State—have become
more aggravated.
1.3 For reasons of this policy, a liberalised entry of imports (most
of which are produced by the multinational corporations) has been
allowed through a hasty withdrawal of quantity restrictions and
repeated reduction of customs duties, without giving adequate time
for preparation to the domestic producers and also after removing
the benefits of subsidy for them. As a result, the common domestic
manufacturers and the farmers have been placed at a position of
unequal competition before the large multinational corporations
nourished with subsidies and other forms of assistance from their
respective Governments over a long period. As a result, in the
overall economic structure it is the monopolistic power, and not
competition, that has increased. In consequence, in our country
the rate of growth of imports has been much faster than that of
exports, with the effect that the gap between imports and exports,
which was only Rs. 3.81 thousand crore in 1991-92 before
liberalisation, has now increased alarmingly by more than 70 times
and crossed Rs. 2.68 lakh crore in 2006-07 (Economic Survey,
Government of India, 2007-08). That means, every year, the
domestic manufacturers and farmers are now losing, in the net
sense, this large share of their markets. As a result of this
significant loss of markets year after year, industrial sickness has
increased in all the States, and the farmers have also been severely
affected. In consequence of this loss of markets for industry and
agriculture and the use, in the absence of any domestic
encouragement for research on appropriate technology, of an overly
capital-intensive and labour-displacing technology in line with the
rich countries, there has been a sharp increase in unemployment
for the country as a whole. According to the latest National Sample
Survey data (2004-05), incidence of unemployment (on current
daily status) in the country has increased by nearly 87 lakh over
the period of five years between 1999-2000 and 2004-05, and
reached a figure of 3.52 crore.
1.4 For reasons related again to the policy of globalisation and
liberalisation, there has been over a long period, a neglect of public
3
investment in agriculture. As a result, in the entire period of
liberalisation (1990-2007), the average annual rate of growth of
foodgrains production has fallen to 1.2 per cent, which is much
lower than the annual rate of growth of population (1.9 per cent) in
the country (Economic Survey, Government of India, 2007-08, p.
155). Our country has therefore lost its position of self-reliance in
food production, and had to import 55 lakh M.T. of wheat in 2006-
07.
1.5 Along with the slackening in the growth of agriculture, there
has also been, in line with the policy of liberalisation, a curtailment
of the public distribution system, weakening of the Essential
Commodities Act and entry of large corporate houses with their
monopoly power in the sphere of agricultural marketing. In
consequence, prices of essential commodities, particularly of
foodgrains have risen sharply in recent period in the entire country.
In this context, the unilateral decision of Central Government to
reduce by nearly 50 per cent the Central allotment of wheat for the
public distribution system in West Bengal has hurt the interests of
common people of the State and also created confusion.
1.6 In addition, it needs to be noted that as the Government of
India started, as a part of the policy of globalisation, some
liberalising measures towards capital account convertibility, the
impact of the U.S. sub-prime mortgage crisis as also that of
recession has already been felt in terms of volatile behaviour of the
Indian share market. This is like a distant thunder with cause of
concern for a possible consequential instability in the macroeconomic
system of our country.
1.7 In the sphere of Centre-State relations, none of the
outstanding problems of the State has been resolved. The share of
Central taxes to the States has not been increased from its low level
of 30.5 per cent, and the unjust burden of the Central loans on the
States, particularly connected with the small savings loan, has also
not been lessened. On the other hand, following the policy of
liberalisation, an encroachment has been made on the decisionmaking
power of the States even in the sphere of State subjects. As
a conditionality of Central assistance, the States, for instance, have
been asked to introduce the Fiscal Responsibility and Budget
Management (FRBM) Act which would curtail the welfare role of the
State Government. In addition, a pressure has been imposed on the
States to introduce the new pension scheme, in terms of which a
fund would be created by deducting 10 per cent from the salary of
4
Government employees, teachers and others. This fund would then
be used for investment in share market, and the returns will be
related to pension payment, with all the uncertainties connected
with such investment. The Government of West Bengal has not
accepted these two policies related to the FRBM Act and the new
pension scheme. The conditionalities of liberalisation have also
been introduced through the Centrally Sponsored Schemes. For
example, in the scheme of JNNURM, the States have been asked,
as a condition of release of Central share of funds, to withdraw the
Urban Land Ceiling and Regulation Act. In addition, it may be
mentioned that in some other Centrally Sponsored Schemes, such
as the SSA, the share of Central Government would be reduced,
ignoring the views of the States, from 75 per cent steadily to 50 per
cent, thus increasing the financial burden on the States.
1.8 Another problem has cropped up due to mechanical overcentralisation
of guidelines in certain Centrally Sponsored
Schemes. For instance, in the case of NREGP, when the progress of
this scheme, after overcoming the problems due to geographical
characteristics of this State, was on full swing and report of the
progress in 7 districts with all the necessary documentation sent to
the Centre in the current year, there has been an undue delay,
becouse of over-centralised procedures, in the release of Central
share of funds leading to a serious problem of implementation.
Confronted with this situation, the State Government had to make
an advance release of its own funds to tide over the problem.
1.9 Honourable Members may therefore kindly note that no
effective clue has been found in the policy of liberalisation to
resolve the major problems of common people, specially those
relating to unemployment and inflation. On the contrary, a vast
majority of people has been further adversely affected by these and
other problems. In the recent Union Budget, although allocations
for education and health have been increased, but these allocations
have still failed to make the public expenditure on education and
health as proportion of the GDP to reach even half of the targets—6
per cent and 3 per cent for eduation and health respectively—as
was pledged in the NCMP of UPA Government.
1.10 On the basis of this experience and analysis, we have been
over the years proposing from this State outline of an alternative
policy for the country within the existing socio-economic structure
by focussing the direction on an employment-oriented growth
5
process based on a move towards more equal competition and
decentralisation. The outline of this policy emphasising—land
reforms, significance of the small and medium industries along
with the large industries, importance of research and application of
modern labour and local resource-intensive technology, public
distribution system from the national level in coordination with the
States for controlling inflation, social direction of the banking
system, significance of welfare role of the Government and a
fundamental decentralisation in the Centre-State relations—has
already been presented in the last budget and the same is not
repeated now. Those aspects of this alternative policy which are
feasible within the limited powers of the State Government will be
the basis of my proposals of this present State Budget.
2.1 Honourable Members,keeping in view the outline of alternative
policy, the main direction of this budget will be to generate
employment to the maximum extent possible within the limited
powers of the statement.Given this direction, there will be a need to
create more competition and opportunity so that production in
agriculture and industry is enhanced and services expanded in a
manner to ensure employment generation to the furthest possible
extent, and cause increase in income and reduction in poverty. In
order to achieve this objective, the main emphasis will therefore be
placed on increasing the empowerment of common people in terms
of land, capital, education and health-and empowerment that is
feasible with the limitation of the State. Emphasis will be placed on
improvement of infrastructure, in particular, irrigation, drainage,
roads and power, so that common farmers and entrepreneurs can
get access to these facilities. The control of inflation through Public
Distribution System is a national issue. Keeping this in view,
definite measures, which are feasible within the powers at the State
level, would also be proposed. Moreover, there will be a specific
proposal to extend assistance to the poorest people of this State. In
addition definite measures will be proposed for development of
minority communities, backward classes and women and also for
regional development of North Bengal, Paschimanchal and the
Sunderbans. Above all, in the matter of implementation of this
employment-oriented development programme of the State,
emphasis will be placed on decentralization and effective
participation of common people through Panchayats and
municipalities.
6
2.2 Since in agriculture, the main direction of the alternative policy
is to increase production and employment generation, and since
according to Farm management Studies data, both employment
generation and production per acre are highest in the case of lands
of small and marginal farmers, the high priority accorded by the
State Government on land reforms will remain firmly in place for
increasing production and employment generation in agriculture as
well as more competition and empowerment of people.
2.3 Honorable Members will be happy to know that according to
the latest data on land reforms compiled by the Government of
India, of all the farmers in the country who have benefited as a
result of distribution of surplus land through land reforms, 54 per
cent belong to West Bengal and this State still occupies the
foremost position in regard to land reforms as in the previous
years. The total agricultural land distributed in this State (upto
January 15, 2008) is 11.19 lakh acre and the number of poor
farmers who have benefited has now reached 29.57 lakh. In
addition, as part of land reforms, the number of recorded
sharecroppers has now reached 15.10 lakh and the number of
beneficiaries of distribution of homestead land has reached 5.14
lakh. It is necessary to mention that while in the rest of the country
, the distribution of ceiling surplus land has almost been stalled
since liberalization, in West Bengal and additional 5,233 acres of
land has been vested and it has been possible to distribute 10,131
acres of land among poor farmers thereby benefiting 46,754 poor
people. In addition, it has been possible to arrange soft loan to
30,045 assignees of vested land and sharecroppers who have
benefited from land reforms.
2.4 Honorable Members are aware that along with these steps, a
new scheme, namely free distribution of land for cultivation and
construction of house, has been started in this State. According to
this scheme, if a person, who owns land within the prescribed
ceiling, is willing to sell a part of his land at market price, the State
Government can purchase such land and distribute it free of cost
among poor farmers/landless agricultural labourers. So far, it has
been possible to purchase about 198 acres of land under this
scheme for distribution among poor farmers and landless
agricultural labourers for cultivation and construction of house.
Since the objective of the scheme is to help the poorest people in
the rural areas, in order to extend the coverage under this scheme
7
for more empowerment of these people, I propose that land may be
purchased under this scheme by paying a price which may be upto
15 per cent higher than the market value. Also, to make the
implementation of the scheme easier, it is proposed that, depending
on the local situation, a person may be distributed land for
cultivation and that for construction of house at slightly different
places. In addition, the cost of development of land distributed
under this scheme to the poor farmers and construction of houses
thereon will be borne by the State Government out of other specific
schemes. The local Panchayats, in coordination with the officials of
the concerned departments, will play an important role in the
implementation of this scheme.
2.5 Further, to make the
existing provident fund scheme for landless agricultural labourers under
which equal contributions are made by the State Government and the
beneficiaries more attractive, the contribution of the State Government
will be increased from the present level of Rs.10 to Rs.20 with
corresponding increase in the contribution from the landless agricultural
labourers. With this improvement, and with increase in the efficiency of
implementation, I propose to increase the number of beneficiary
agricultural labourers under this scheme from existing 9.59 lakh to 11
lakh in the next financial year.
2.6 Having regard to the
importance of land reforms and the priority attached to the new
schemes, I propose to provide an additional sum of Rs.20 core for land
reforms in the plan budget of the next financial year. With this additional
allocation, the total plan outlay for land reforms, which has already been
increased from Rs.30 crore in 2007-08 to Rs.50 crore in 2008-09, is
proposed to be increased further to Rs.70 crore.
2.7 Keeping this priority on land
reforms intact, the target for agricultural production in the State has
been fixed in such a manner that self-sufficiency in foodgrains
production is not only achieved, but also sustained during the entire
Eleventh Five Year Plan period (2007-12) and beyond. After maintaining
self-sufficiency in foodgrains production, priority has been accorded to
crop-diversification so that the deficit in the case of some major crops
can be reduced and horticulture and floriculture can also be encouraged.
In addition, special importance has been attached to enhancement of
productivity in the case of some important crop. The main objective
behind all these initiatives is to increase, to the extent possible,
employment generation for farmers and theirs income. In order to
8
achieve that objective, along with land reforms, extension of irrigation
facilities, use of improved seeds, proper application of fertilizers, flow of
credit to agriculture, preservation of crops and improvement of
marketing facilities are especially important.
2.8 As a result of according
priority to extension of irrigation facilities, the total net irrigated area as
a proportion of the total net agricultural area has increased steadily from
32 per cent in 1977-78 to 70.5 per cent in 2007-08. the target of raising
this proportion of net irrigated area has been fixed at 73 per cent in the
next year, which will then be steadily raised to 80 per cent at the end of
the Eleventh Plan. In regard to the use of improved seeds, particularly in
the case of production of paddy, while in the year 1977-78, only 28 per
cent of the total cultivated area was covered by use of improved seeds, in
2007-08, the coverage has increased steadily to 96.5 per cent, and for
crops, it has reached 85 per cent. I propose to increase these proportions
to 97 per cent and 89.75 per cent respectively in the next year so that
these proportions can steadily improve and reach 99 per cent and 95 per
cent respectively at the end of Eleventh Plan. In regard to application of
fertilizers, emphasis has been placed on the use of a balanced mix of
chemical, organic and bio-fertilizers instead of chemical fertilizers alone.
It has been estimated that in 2007-08, 100 lakh metric tonne of organic
fertilizers and 525 metric tonne of bio-fertilizers will be used along with
15.38 lakh metric tonne of chemical fertilizers. The targets for use of
these three types of fertilizers in the next financial year have been fixed
at 16.75 lakh metric tonne, 125.05 lakh metric tonne and 690 metric
tonne, which will be increased further to 21.10 lakh metric tonne, 300
lakh metric tonne and 1.100 metric tonne respectively in the last year of
the Eleventh Plan. In consequence of all these steps, starting with land
reforms, the Gross State Domestic Product from agriculture in the State
over the ten year period from 1993-94 to 2003-04 has grown at an
average annual rate of 3.64 per cent which is not only much higher than
the average annual rate of growth of Gross State Domestic Product from
agriculture for all State (1.53 per cent) but is also the higher among all
States (Sources: Planning Commission and Central Statistical
Organization, Government of India). According to advanced estimates,
the overall rate of growth from agriculture during the last three years
(from 2004-05 to 2007-08) has improved further to 3.92 per cent. Based
on this record, we are committed to achieving a rate of growth somewhat
higher than 4 per cent in agriculture during the Eleventh Plan period
(2007-12), whereas in the case of the country as a whole, the target for
the rate of growth in agriculture could not be fixed beyond 4 per cent.
2.9 Honourable Members, in the
current year, the State has been hit by devastating floods in four phases
affecting all the districts. 273 persons died, 1.18 crore people were
9
affected and 9.78 lakh houses were damaged either partially or fully.
There was also extensive damage to roads, irrigation embankments and
other infrastructure and specially to crops on an area of 8.59 lakh
hectares.
Confronted with this natural
calamity, the State Government, with a sustained coordination with the
concerned departments, the district administration and Panchayats
sanctioned Rs.553.82 crore for relief and reconstruction. In the
reconstruction programme, distribution of free mini-kits for the purpose
of increasing production during the Rabi season has been accorded
special priority. A sum of Rs.76.29 crore has been sanctioned only for
this purpose. Honourable Members will be happy to know that as a
result of these measures, although the State has been hit by natural
calamity several times during the current year (2007-08), the total
production of rice in the State in the current year will exceed the level of
the last year (147 lakh metric tonne) and is estimated to reach 149 lakh
metric tonne, which is higher than the total internal requirement of the
State (137 lakh metric tonne), and West Bengal has again occupied the
first position amount all States in production of rice. The production of
potato will increase from 50 lakh metric tonne in the previous year to 76
lakh metric tonne in the current year which is again higher than the
requirement of the State (43.5 lakh metric tonne) and in this regard, the
State occupies the second position in the country as before. In addition,
despite natural calamities, the total production of vegetables in the State
in the current year will increase to 129 lakh metric tonne and here also,
West Bengal occupies the highest position amount all States. However,
although the production of wheat, pulses and oil seeds has increased in
the current year to 9.20 lakh metric tonne, 1.80 lakh metric tonne and
6.81 lakh metric tonne respectively, it is still short of the requirement of
the requirement of the State.
2.10 In order, therefore, to
strengthen the self sufficiency of the State in the case of foodgrains and
to reduce the deficit in case of other important crops, targets have been
fixed to increase the total production of foodgrains in 2008-09 to 172.85
lakh metric tonne (rice – 161.49 lakh MT, wheat – 9.37 lakh MT and
pulses – 1.99 lakh MT), which is a little higher than the total foodgrains
requirement of the State in the year (171.80 lakh MT). Thereafter, to
maintain the self-sufficiency in the production of foodgrains, these
initiatives will be continued during the entire Eleventh Plan period and
beyond. For achieving the targets of production of various crops, along
with expansion of irrigation facilities, special priority has been accorded
to enhance the productivity of each crop. To this end, it is particularly
important to achieve self-sufficiency in the production of improved seeds
in case of all the important crops. After attaining self-sufficiency in the
10
production of seeds of paddy and mustard, priority is now to be given to
the attainment of self-sufficiency in case of production of seeds of other
crops, particularly potato, wheat and jute. For this purpose, with due
consideration for preservation of bio-diversity, emphasis will be placed on
production of certified seeds by involving the women self help groups
through Panchayats in each Block, in addition to making use of the
existing State agricultural farms and the CADPs. In addition, to
enchance further the productivity of crops, emphasis will be placed on
the use of organic fertilizers and organic process for agricultural
production, as recommended in the interim report of the State
Agriculture Commission. As a part of this process, it has been decided to
set up 20 (twenty) bio-villages during the next year. With a view to
attaining self-sufficiency in agriculture and enhancing productivity, after
increasing the plan outlay from Rs.51 crore in the current year to about
Rs.90 crore in the next year. I propose to allocate an additional sum of
Rs.10 crore. With this, the overall plan outlay for agriculture for the next
financial year stands raised to Rs.100 crore.
2.11 I have mentioned earlier that in consideration of the importance of
the need for crop-diversification, emphasis has been laid on horticulture
and floriculture. As a result, the production of pineapple in the State
has increased from 3.72 lakh metric tonne in 2006-07 to 3.81 lakh
metric tonne in 2007-08, and West Bengal has occupied the first position
among the States in this regard. The targets of production of pineapple
for the next year (2008-09) and the last year of the Eleventh Five Year
Plan (2007-12) have been fixed at 3.94 lakh metric tonne and 4.39 lakh
metric tonne respectively. The production of litchi has increased from
77.2 thousand metric tonne in the last year to 79.9 thousand metric
tonne for the current year. In this case, West Bengal ranks second
among the States. The targets of production of litchi for the next year
and the last year of the Eleventh Five Year Plan have been increased to
82.3 thousand metric tonne and 91.1 thousand metric tonne
respectively. In this case, West Bengal has ranked second among the
States. The production of mango has increased from 5.49 lakh metric
tonne in the last year to 5.66 lakh metric tonne in the current year. Here
the State occupies the sixth position. The targets of production of mango
for the next year and the last year of the Eleventh Five Year Plan have
been raised to 6.03 lakh metric tonne and 6.44 lakh metric tonne
respectively. The production of potato and vegetables has also increased,
as already mentioned. For the purpose of export of pineapple, litchi
mango and vegetables, after meeting the requirement of the State,
initiatives have been taken to set up special zones. A particular
emphasis has been given on floriculture, industrial use of flowers and
export of flowers. Attaching importance to production of improved seeds
and seedlings and improvement of storage and marketing facilities in all
these spheres, I proposes to increase the plan outlay for floriculture and
11
food processing from Rs.27 crore in the current year to Rs.32.35 crore in
the next year.
2.12 I have already mentioned that in view of the significance of
extension of irrigation facilities for enhancing employment generation
and production in agriculture, the targets for increasing the total net
irrigated area as a proportion of total net agricultural area have already
been increased to 73 per cent for the next year and 80 per cent at the
end of the Eleventh Plan period. For achieving these targets, special
emphasis has been placed on minor irrigation facilities, and within the
sphere of minor irrigation, on reclamation of ponds, lakes, canals, etc. to
be implemented in coordination with the National Rural Employment
Guarantee Programme. The reclamation of these water bodies will not
only expand the irrigation facilities, it will also play an important role in
the matter of drainage moderation of the impact of floods as well as
improvement of pisciculture. Keeping in view the overall importance of
minor irrigation, I propose to increase the plan outlay of the Water
Resources Investigation & Development Department from Rs.125 crore in
the current year to Rs.166.75 crore in the next year.
2.13 In the sphere of large and medium irrigation projects, priority has
been given on speedy completion of major projects. Along with this,
special emphasis has also been laid on anti-erosion schemes and basinspecific
drainage schemes in the districts.
Among the major irrigation projects, the Teesta Project is truly a project
of national-leval importance. About Rs. 1,139.52 crore has already been
spent on implementation of this scheme, 77 per cent (Rs. 874.22 crore) of
which has been borne by the State Government. Since the project has
international implications, the State Government has repeatedly raised
the justified demand before the Central Government that this project be
given the status of a national project. Recently, this demand has been
acceded to by the Central Government. Although no formal
communication has as yet been received from the Central Government,
according to preliminary information, 90 per cent of the balance
requirement of fund (Rs. 1,346.48 crore) for completion of the first phase
of work will be borne by the Central Government and the remaining 10
per cent will borne by the State Government. In that case, the overall
Central share in the expenditure (Rs. 2,486 crore) for the project,
including the expenditure already incurred, will be 59 per cent and the
State’s share will be 41 per cent. It has also been possible to have
another major project, namely, Subarnarekha Project, included under
the Accelerated Irrigation Benefit Programme (AIBP). According to the
general funding pattern under this programme, 75 per cent of the
estimated expenditure for the project will be borne by the State
Government and 25 per cent will be borne by the Central Government.
12
The State Government has already spent Rs. 39 crore for this project.
However, since a large part of the command area of this project is
inhabited primarily by people belonging to the Scheduled Tribes, the
State Government has justifiably urged the Central Government to bear
90 per cent of the expenditure for the project in terms of the existing
policy.
The prevention of erosion of
the Ganga-Padma River System is also a national-level issue. In spite of
this, out of the total expenditure (Rs.567.92 crore) incurred from 1977-
78 to 2007-08 on preventing this erosion, about 62 per cent (Rs. 351.97
crore) had to be borne by the State Government. In recent years,
although the Central Government has taken the responsibility of antierosion
works of Ganga-Padma River System in areas adjacent to the
Farakka Barrage in Malda and Murshidabad districts, it has refused to
undertake any maintenance of anti-erosion works in this region. As a
result, the additional financial burden of such maintenance works had to
be shouldered by the State Government. The erosion of Bhagirathi River,
particularly in the districts of Burdwan and Nadia, has also reached a
critical level. The State Government has already spent Rs.37.63 crore for
preventing erosion of Bhagirathi River and has decided to allocate an
additional amount of Rs.33 crore in the next year to mitigate this
problem. While utilizing this fund for implementation of these schemes,
special care would be taken, on the basis of past experience, in the
matter of selection of appropriate technology.
The State Government has also decided that a demand will be
urgently made to the Central Government for inclusion of important
basin-specific drainage schemes and river reclamation schemes, namely,
Kandi Basin Drainage Scheme, Keleghai-Kapaleswari Basin Drainage
Scheme, Ghai-Kunti Basin Drainage Scheme, etc. under the Centrally
Sponsored Programme, where the Central and the State Governments
would share the expenditure for a project in the ratio of 75:25. Likewise,
after completing the reclamation works of an important stretch of river
Ichhamati, the issue of reclamation of the remaining stretch of the river
(in North 24-Parganas and Nadia districts) and also rivers in the lower
Damodar region will also be taken up with the Central Government for
implementation as Centrally Sponsored Schemes. In the matter of
construction and improvement of irrigation embankments, necessary
linkage will be established with the national Rural Employment
Guarantee Programme. Considering the need for implementation of all
these projects, after having increased the plan outlay of the Irrigation
and Waterways Department from Rs.340 crore in the current year to
Rs.400.90 crore in the next year, I propose to allocate an additional sum
of Rs.20 crore for establishing necessary linkage with the National Rural
13
Employment Guarantee Programme. With this additional allocation, the
overall plan outlay of the Irrigation and Waterways Department is
proposed to be raised to Rs.420.90 crore.
2.14 In the sphere of animal resource development, the main
focus is on enhancement of employment generation by increasing
the production of milk, eggs and meat and a steady reduction of the
gap between the State’s requirement and production. To this end,
along with improvement in infrastructure, a new initiative has been
undertaken in recent years to train unemployed youth in rural
areas as ‘Pranibandhus’ for assisting the rural people in artificial
insemination and health care of animals. So far, 2,789
Pranibandhus have been involved in this programme and the
number of artificial insemination centres has also increased to
2,908. As a result of these initiatives, the total milk production in
the State has increased from 39.82 lakh metric tonne in 2006-07 to
40.77 lakh metric tonne in 2007-08 and is then targeted to
increase to 42.25 lakh metric tonne in 2008-09 and then steadily to
46.89 lakh metric tonne at the end of the Eleventh Plan period,
which would be nearly 75 per cent of the State’s requirement in
that year. Similar steps have been initiated in the case of
production of egg and meat.
While these steps are being taken, there has been an outbreak of
bird flu in the State since the middle of January, 2008. To control
the spread of this disease, about 39.98 lakh chickens have been
culled and an extensive programme of disinfection has also been
taken up. In addition, poultry farming has been banned for a
period of three months in the affected areas. Apart from paying
compensation for culling of birds, the State Government has
sanctioned additional financial assistance of Rs. 500 for each of the
affected families (about 7 lakh). An alternative livestock farming
programme has also been contemplated in the affected areas for
the next 3 (three) months for rehabilitation of poultry farmers. An
additional amount of about Rs. 105 crore will be required for this
purpose. Recently, there has been a fresh outbreak of this disease
at a few places where also similar steps had to be taken. For
payment of compensation, additional financial assistance and
rehabilitation, the State has already sanctioned Rs. 51 crore and a
demand has correctly been made to the Central Government for
sharing 50 per cent of the expenditure for payment of
14
compensation for culling of birds (as admissible under the rules of
the Central Government) and alternative livestock farming
programme. So far, however, only Rs. 10 crore has been received
from the Centre. Keeping in view the main objective of animal
resource development and having regard to the need for mitigating
the problems caused by the outbreak of bird flu and the
rehabilitation of affected families, I propose to increase the plan
outlay of this department from Rs. 23.38 crore in the current year
to Rs. 62.57 crore in the next year.
2.15 In the sphere of pisciculture, as a result of initiatives taken
by the Department of Fisheries with involvement of common
fishermen through the Panchayats in the matter of expansion of
water areas in the districts, use of improved fish-seeds and training
of fishermen, the total fish production in the State has increased
from 13.59 lakh metric tonne in the previous year to 14.48 lakh
metric tonne in the current year, which is more than the
requirement (13.20 lakh metric tonne) of the State. Based on a
consistent record of increase in production of fish, the targets for
fish production for the next year and the last year of the Eleventh
Plan have been fixed at 14.71 lakh metric tonne and 15.58 lakh
metric tonne respectively. Keeping in view the role of fish
production in increasing employment generation and income of the
rural poor, I propose to allocate an additional sum of Rs. 5 crore in
the next year for the purpose of development of marketing facilities.
With this additional allocation, the plan outlay of the Department
of Fisheries which has already been increased from Rs. 65 crore in
the current year to Rs. 75.42 crore in the next year, is proposed to
be raised further to Rs. 80.42 crore.
2.16 In the case of forestry, as a result of involving the local
people in forest protection and planned afforestation, the forest
cover as a proportion of the total area of the State has increased
from 14.97 per cent in 1991 to 15.68 per cent in 2006. Through
implementation of social forestry programme in coordination with
the Panchayats, there has been an increase in tree-cover and the
proportion of forest and tree-cover in the State is now 30.74 per
cent. Thus, the State has already crossed the Eleventh Plan
national target of 30 per cent for forest and tree-cover. In this
scenario, in order to raise further the target of forest and tree-cover
to 33 per cent at the end of the Eleventh Plan, I propose to increase
the plan outlay of Forest Department from Rs. 43.10 crore in the
current year to Rs. 59.77 crore in the next year.
15
2.17 The annual requirement of credit for agriculture and allied
activities (animal resource development, pisciculture, social
forestry, etc.) is to the tune of at least Rs. 10,000 crore. However, in
the last year, the credit disbursed by the banks for these sectors
was only Rs. 3,580 crore. After necessary discussion with the
representatives of the Reserve Bank of India and other banks, the
target for credit disbursement for these sectors was raised by 25
per cent over the last year’s target of Rs. 4,000 crore and fixed at
Rs. 5,000 crore. According to the latest data available for the
current year, it is now estimated that about 95 per cent (Rs. 4,750
crore) of this target will be achieved. Based on this performance,
the target for disbursement of credit to agriculture and allied
sectors for the year 2008-09 will be further raised by
30 per cent and fixed at Rs. 6,175 crore. At the same time,
following the recent decision of loan waiver in the case of small and
marginal farmers, we demand that the target of universal banking
should be achieved during the Eleventh Plan period, particularly in
this State. In other words, facilities for opening of at least one bank
account for each family in the State should be extended.
2.18 In order to ensure increase in the income of the common
farmers along with enhancement of production and employment
generation in agriculture, it is specially important that the farmers
get fair price for their produce. For this purpose, in the case of rice,
the State Government, the Food Corporation of India and the
Cooperative Societies have drawn up a joint programme in
coordination with the Panchayats so that the produce of the
farmers can be procured from them at fair price and supplied to the
common farmers through the public distribution system and other
social programmes and through this measure, inflation can also be
controlled to some extent. However, in the current year, although
there has been satisfactory production of rice in the State, as a
result of the decision of the Central Government to export rice to
other countries indiscriminately, the market price of rice has been
much higher than the procurement price fixed by the Central
Government. In consequence, the State Government has faced
enormous problems in procurement of rice. This apart, in case of
wheat also, the Central Government has recently cut down the
allocation of this State by nearly 50 per cent, which has
compounded the problem mentioned before. Even in the midst of
this difficulty, the State Government has so far procured 3.25 lakh
metric tonne of rice primarily through collection of compulsory levy
16
from rice millers. However, for supplying rice and wheat to common
consumers of the State at a fair price, it is necessary to procure
more rice and wheat. To tide over this problem, we are making a
demand to the Central Government for releasing rice and wheat to
the State according to the original allocations, as in the previous
years.
Honourable Members, while placing this demand before the
Central Government, we have at the same time decided to procure
rice and wheat, if necessary, on payment of additional subsidy. I
propose to allocate an additional amount of Rs. 90 crore for
meeting the expenditure on this subsidy.
2.19 In addition, in order to control the prices of various
commodities including rice and wheat, I propose to set up a new
marketing corporation for procurement and supply of commodities
at fair price through self help groups. For this purpose, I propose to
allocate an additional amount of Rs. 100 crore as share capital
contribution of the State Government to this corporation. This
corporation may set a new example in the sphere of employment
generation and marketing in the interest of common people by
functioning in close coordination with the concerned departments
of the State Government, Panchayats and municipalities.
2.20 Honourable Members, on the basis of careful examination
of the implications of the measures proposed in the sphere of
agriculture and allied sectors, as mentioned earlier, it has been
estimated that on account of these efforts, potentiality of at least 3
lakh employment generation would be created from agriculture and
allied activities taken together in the next year.
2.21 As a result of these comprehensive steps beginning with
land reforms, not only has there been an increase in employment
generation and production, the purchasing power of common
people has also increased. According to the National Sample Survey
Data, common people in the rural areas of West Bengal are now
spending about Rs. 21,000 crore every year on industrial goods.
Alongside this, the urban people are also spending about Rs.
18,000 crore every year on this account, and this internal market
of the State is growing by at least 8 per cent every year.
2.22 As a result of the combined effect of a growing internal
market, locational advantage of the State, availability of skilled
workers, scientists and technologists, considerable improvement in
17
infrastructure, social stability and the positive attitude of the State
Government, West Bengal has, of late, become one of the most
preferred destinations in the country for industrial investment. This
potential has been created in the case of large, medium and smallscale
industries as well as in the case of formation of self help
groups. Industrialisation, in our view, means giving due importance
to the development of each of these sectors with a view to
increasing employment generation. At the same time, it also
includes the initiatives for reopening of closed factories within the
limited powers of the State Government.
2.23 As a consequence of the emergence of this industrial
potential, while during the period from 1991 to 2006, a total
number of 1,439 industrial units in the organised large and
medium industries sectors with a realised investment of Rs.
32,631.87 crore had commenced production, at the end of the year
2007, the total number of such units has increased to 1,730 and
the total realised investment has increased to Rs. 37,704.13 crore.
In other words, while even two years ago, in the year 2005, the
annual investment was Rs. 2,515.58 crore, within a period of two
years, the same has been more than doubled and reached Rs.
5,072.26 crore in 2007. The State Government has now received
fresh investment proposals (worth Rs. 2.28 lakh crore) in areas
relating to iron and steel, food processing, manufacture of vehicles,
etc. Most of these investments will be realised within the next five
years. As a result, the annual realised investment, which now
stands at Rs. 5,072.26 crore, will soon again be more than
doubled.
2.24 In regard to the realised investment during the period from
1991 to 2007, the industries which occupy the front positions are
iron and steel, food processing, chemicals and petrochemicals,
information technology, jute and textiles, engineering goods, leather
and rubber, gems and jewellery, etc. In order to encourage further
investment in each of these areas, initiative has been taken to set
up for each of these categories of industries, industrial complex,
industrial parks,etc. In addition, with the objective of a
comprehensive development of industrial potential of the State in
the sphere of chemicals and petrochemicals, special initiative has
also been taken to set up a Petroleum, Chemicals and
Petrochemicals Investment Region at Nayachar Island.
2.25 It is necessary to mention here that from the realised
investment in the organised industries in the State during the
18
period from 1991 to 2007, about 2.21 lakh direct employment has
been generated. Within this, in the current year itself, 41,219 direct
employment has been created which is much higher than the direct
employment (28,572) created in the last year (2006). With
continued increase in investment in the coming years, there will be
further increase in direct employment. If indirect employment is
added to this, the total employment will be more than three times
this direct employment. Honourable Members, in order to
encourage the large and medium industrial units to create more
employment, we have decided to modify the existing scheme of
incentives to industries. In line with the alternative policy,
incentives under the new scheme will be linked mainly to
generation of employment by the concerned units. This may set a
new example in the entire country in the matter of employmentoriented
industrial development. Government notification in this
regard will be issued shortly.
2.26 A special feature of investment in large and medium scale
units in the State is that out of the 1,730 industrial units which
have commenced production in the recent years, about 70 per cent
are medium scale units in which the investment is less than Rs. 10
crore, and, in most of these cases, the investors are local
entrepreneurs. The requirement of land for setting up of such
medium or small scale units (mentioned later) is small and
generally, there is no problem relating to availability of land for
these industries. Even in the case of most of the large industries,
the problem relating to availability of land is not very serious. Only
in the case of a few large industries where a large area of land is
required because of the special characteristics of the industry, it
will be necessary to proceed, after consultation with local farmers
and payment of due compensation for acquisition of land with
necessary balance being maintained between agriculture and
industry. While the industrial establishments will be primarily
responsible for payment of this compensation, in some cases,
problems may continue even after that. To take care of such
problems, I propose to allocate an additional amount of Rs. 100
crore for the purpose of creating a Special Assistance Fund. This
fund will be utilised for the purpose of imparting job-oriented
training and extending other necessary forms of assistance to the
land losers. Having due regard to the role of incentive schemes for
industries in the organised sectors, I propose to increase the plan
outlay of the Commerce and Industries Department from Rs. 200
crore in the current year to Rs. 350 crore in the next year.
19
2.27 By virtue of the relatively better position of this State in
regard to intellectual capital, there has been in recent years
significant development in information technology and information
technology-enabled services. While in the year 2006-07, the rate of
growth of software exports for the country as a whole was 32 per
cent, the rate of growth of software exports from this State was 46
per cent. In 2007-08, this has increased further to 50 per cent. In
the next year as well as in subsequent years, this rate of growth is
estimated to remain at 50 per cent or even higher. Along with this
significant development in the case of software technology, the
State Government has, of late, taken initiatives to set up a Design
Centre at Bidhannagar and an Information Technology Park at
Kharagpur with a view to attracting investment in hardware and
chip manufacturing sector. As West Bengal has become one of the
most attractive destinations in the country for investment in
information technology, reputed organisations of the country as
well as those of international standing are coming forward for
investment. Alongside this, the medium and small scale
entrepreneurs, constituting about 80 per cent of the total number
of investors, are also investing in this sector. As a result, significant
potential for additional employment generation has been created in
the field of information technology. It has been estimated that the
additional generation of employment in this sector will be 15,000 in
the current year, 30,000 in the next year and 2.5 lakh during the
Eleventh Plan period (2007-12). Keeping in view these
achievements in the field of information technology and the scope
of employment generation in this area, I propose, in order to give
further emphasis on improved training facilities, an increase in the
plan outlay of the Information Technology Department from Rs.
56.50 crore in the current year to Rs. 71.29 crore in the next year.
2.28 In the matter of industrialisation in the State, maximum
potential for employment generation has been created through
expansion of small scale industries sector and self help groups. The
growth of small scale industries sector and the related employment
generation has been reflected in the data of the latest National
Sample Survey (2005-06). It is found from these data that both in
respect of the number of working units and generation of
employment in the units, West Bengal ranks first among all the
States. According to these data, the number of working small scale
units in this State in 2005-06 was 27.53 lakh and employment
generation in those units reached 54.93 lakh, which accounted for
15 per cent of the total employment generated in small scale
20
industries sector in the country. For the development of small scale
industries, special priority has been accorded to development of
infrastructure for clusters of industries. Having regard to the
industrial characteristics of each district of the State, work relating
to development of 39 clusters in the field of small scale industries,
handloom industries, rural industries and handicrafts has been
started in various districts in the current year. The number of these
clusters will be increased to 54 in the next year and to 229 in the
last year of the Eleventh Plan. In addition, the State Government
has formulated a new textile policy and has also commenced its
implementation. Under this policy, special emphasis has been given
on development of handloom and garment industries along with
development of sericulture. In the case of handloom industries, in
addition to development of infrastructure for handloom clusters
and development of computer aided design, steps have also been
taken to set up an advanced export centre in Nadia district. On the
basis of the projects already implemented, it has been estimated
that in the next year (2008-09) at least 2 lakh additional
employment will be generated in the small scale industries sector.
Having regard to the important role played by the small scale
industries sector in employment generation, I propose to increase
the plan outlay of the Micro and Small Scale Enterprises and
Textiles Department from Rs. 74.20 crore in the current year to Rs.
121 crore in the next year.
2.29 Honourable Members, in the matter of employment
generation in the State, maximum progress has been achieved in
the case of self help groups. In the current year (2007-08), the
number of self help groups has already reached 7.34 lakh with a
total membership of about 70 lakh, 90 per cent of whom are
women. These self help groups have mobilised savings from their
members and then about 4.36 lakh self help groups have obtained
loan from banks on the strength of such savings. In more than 90
per cent of the cases, these loans have also been repaid. According
to the assessment of NABARD, about one-third of these groups
have qualified, on repayment of earlier loan, for second and third
doses of loan. This has resulted in additional employment
generation of at least 3 lakh in the current year. Based on this
progress of the self help groups, it has been decided that during the
Eleventh Plan period, all willing families will be brought under the
universal coverage of self help group formation. As part of that,
target has been fixed to raise the number of self help groups to 8
lakh in the next year and to create again additional employment of
21
at least 3 lakh on the strength of own savings and bank loan. A
special requirement for the development of self help groups is
proper training of the members of the groups and creation of
organised facilities for marketing of their produce. I have already
mentioned that for this purpose, a full-fledged corporation will be
set up. This corporation will function by maintaining live contact
with the self help groups through the Panchayats and
municipalities and will play an important role in employment
generation and price control. Giving importance to the development
of self help groups, I propose to increase the plan outlay of the Self
Employment and Self Help Groups Department from Rs. 30 crore
in the current year to Rs. 160 crore in the next year, which will
include an additional allocation of Rs. 100 crore for the
corporation, as already mentioned.
Honourable Members may note that if the potentials for
employment generation in large and medium industries and
through expansion of small scale enterprises and self help groups,
as mentioned earlier, are taken together, then a total of more than
5.5 lakh additional employment can be generated in these sectors
in the next financial year.
2.30 Adequate credit facilities are extremely important in the
case of small scale industries, self help groups and selfemployment
programmes. According to revised estimates, the
annual requirement of credit for small scale industries, self help
groups and self-employment programmes in this State is at least
Rs. 5,500 crore. In this background, although the disbursement of
credit to small scale industries and related areas has increased
from Rs. 1,538 crore in the last year (2006-07) to an estimated
amount of Rs. 2,250 crore in the current year (2007-08), it is still
far short of the requirement. It has, therefore, been decided, after
discussion with the Reserve Bank of India, NABARD, other banks
and the concerned departments of the State Government, that a
special drive will be made in the next year, so that the
disbursement of credit to these sectors can be raised to at least Rs.
3,750 crore and, thereafter, to Rs. 5,500 crore in phases.
2.31 Honourable Members, I have already mentioned how the
economic policies being followed at the national level have resulted
in a large number of industries in every State being closed or sick.
As part of this national process, some industrial units in West
Bengal have also become either sick or closed. Against this
background, the State Government, while encouraging the setting
22
up of new industries, has also been making, with its limited
powers, continuous efforts for revival of closed and sick industries,
specially by placing its views before the BIFR in the interest of
industrial workers and by granting subsidy, tax relief, etc. As a
result of these steps, it has been possible to revive 26 units and 51
more units are also likely to be revived. In addition, the State
Government has taken initiatives jointly with the Central
Government for reopening of 14 closed tea gardens, out of a total of
277 tea gardens in North Bengal. For this purpose, for the first
time, certain definite steps have been initiated under section 16E of
the Central Tea Act for the purpose of transfer of management of
the tea gardens to suitable entrepreneurs who may come forward.
In addition, in case of reopening of closed tea gardens, decision has
been taken by the State Government to grant exemption from
payment of certain taxes and duties and by the Central
Government to grant some debt-relief. Along with these steps, at
the initiative of the State Government, other measures relating to
introduction of employment generation programmes for the workers
of closed tea gardens and free supply of foodgrains to them, etc.
have also been taken. Honourable Members are aware that the
State Government has been extending financial assistance at the
rate of Rs. 750 per head per month to the workers of the tea
gardens and factories which have been lying closed for more than a
year. In order to further encourage the reopening of closed tea
gardens and factories in the State, I propose to continue this
financial assistance for a period of one year even after reopening of
the closed tea gardens or the factories, as the case may be.
2.32 At the initiative of the State Government, a provident fund
scheme for the workers in the unorganised sector was introduced
in the State for the first time in the country. Implemented on the
basis of joint contribution from the State Government and the
workers, about 10.09 lakh workers have already been enrolled
under this scheme. So long, unorganised workers of 21 sectors
were under the purview of this scheme. I am happy to announce
that the State Government has decided to include the workers
belonging to 23 additional sectors, including maid servants, and it
has been decided to increase the number of beneficiaries of this
scheme steadily from the existing 10.09 lakh to 20 lakh. In
addition, the benefits of the legislation concerning the interest of
construction workers which the State Government has enforced
have reached 40,506 in the current year. The target of extending
23
this benefit to construction workers has been fixed at 2 lakh in the
next year. At the same time, I also propose to increase the target of
construction of subsidised dwelling units for bidi workers to 15,000
in the next year. Having due regard to the initiatives taken by the
Labour Department, I propose to increase the plan outlay of the
Department from Rs. 40 crore in the current year to Rs. 80 crore in
the next year.
2.33 Development of common infrastructure, particularly,
improvement of roads and bridges and power situation, is essential
for sustainable growth and employment generation in agriculture
and industries. Keeping this requirement in view, construction of
116 bridges and railway flyovers through Public Works and Public
Works (Roads) Department had been taken up during the Tenth
Plan period (2002-07). Out of this, 102 bridges and flyovers have
already been completed, 6 will be completed in the next year and
the remaining ones will be completed in the following year. During
the Eleventh Plan period (2007-12), construction of 96 additional
bridges and flyovers has been targeted. Out of these, preparatory
steps have been taken for 10 bridges and flyovers, and work in
respect of these will commence in the next year. Construction of
the remaining bridges will be taken up thereafter. In the case of
roads, the work of improvement of 5,522 kilometers of road which
had started during the Tenth Plan period has since been completed
and against a target of improvement of 3,080 kilometers of road
during the Eleventh Plan period, work in respect of 250 kilometers
has been completed in the current year itself, and work in respect
of another 669 kilometers will be completed in the next year. If the
road works undertaken by the Public Works Department are
dovetailed with schemes taken up under the National Rural
Employment Guarantee programme, it will be possible to increase
the output in both the cases. Therefore, with emphasis on
comprehensive improvement of roads, and to forge necessary
linkage between the two types of schemes, as mentioned earlier, I
propose to allocate an additional amount of Rs. 20 crore in the next
year. Accordingly, the plan outlay of the Public Works and Public
Works (Roads) Department, which has already been raised from Rs.
665.68 crore in the current year to Rs. 700.15 crore in the next
year, is proposed to be raised further to Rs. 720.15 crore. For the
purpose of improvement of public transport, while proposing to
increase the fleet strength of the State Transport Corporations by
400 buses, emphasis will also be given to the important issue of
24
improving the internal efficiency of the Corporations. This apart,
over the last three years, the concreting work of 29 kilometers of
tram lines at a cost of about 101 crore has also been completed.
Having regard to the positive impact of this work on public
transport, it has been decided that the concreting work of the
remaining significant stretches of tram lines will also be completed
in the next one year. Giving priority to public transport, I propose
to increase the plan outlay of the Transport Department from Rs.
128 crore in the current year to Rs. 147.20 crore in the next year.
2.34 In the case of power generation, there was a problem in
achieving the target for capacity addition that was set for the
current year for sustaining the balance between the demand and
the supply of power, which was due to delay on the part of
suppliers of plant and machinery. As a result, there has been a
difficulty in maintaining this balance. The Power Department has,
however, drawn up a definite action plan for installation of an
additional capacity of 1,570 MW within the next one year. This will
improve the balance between the demand and supply of power. In
the case of rural electrification, out of 37,910 villages, 36,944
villages will be covered by the end of the current year. The State
Government has also set a deadline for completing the very
important task of providing electricity to each household in the
rural areas during the Eleventh Plan period.
It is, however, important to mention here that