The Hindu Business Line : Eastern States have immense economic potential: Study

The unique challenges faced by each of the States range from huge infrastructural requirements and socio-economic backwardness to law and order, over-population and poverty eradication.

Kolkata , April 14

The eastern region of India, comprising the five States of West Bengal, Chhattisgarh, Jharkhand, Orissa and Bihar, though endowed with abundant minerals, forests, a fertile and productive soil and good cultural heritage, is still a land of unrealised potential.

A recently released CII-Ernst & Young joint report on the economic potential of the region and the fiscal incentives needed for further development, sees much hope with a spurt in investments already happening and the Net State Domestic Product (NSDP) in 2005 showing an uptrend in all the States, with West Bengal leading the way. It is pointed out that the Eastern States have immense potential for large-scale production of spices, jute and other agro products, which can be exported at competitive prices. The study also envisages a resultant large-scale employment opportunities and wealth creation in the area.

According to the study, the current per capita income of the States averaged to $254.2 as against the national average of $395. In West Bengal, with a population of 80.20 million, it is put at $395, followed by Chhattisgarh at $264 (20.80 million), Jharkhand $248.31 (26.94 million), Orissa $ 230 (36.70 million) and Bihar $133.67 (90 million). Jharkhand is said to be towering the list of announced projects, entailing a total investment of Rs 1,34,471 crore, followed by Orissa at Rs 1,07,002 crore, West Bengal Rs 53,603 crore (though showing only Rs 2,909 crore at the implementation level), Chhattisgarh Rs 31,618 crore and Bihar at a meager Rs 540 crore (with proposed projects at an investment of Rs 14,333 crore).

The unique challenges faced by each of the States, according to the study, range from huge infrastructural requirements and socio-economic backwardness to law and order, over-population and poverty eradication. Bihar, accounting for a seventh of the country's population below the poverty line, faces severe challenges such as low investment rates, weak transport system, lack of water management and fragmentation of land holdings.

The new Bihar Government's strategy, according to the report, warrants a multi-dimensional approach across sectors and institutions — beginning with administrative reforms, basic institutional reforms of proper delegation and stringent fiscal management.

In the case of West Bengal, projects are being identified for development of regional airports, better network of roads and improvement of navigable waterways.

Challenging decisions to sell or close down unprofitable state PSU units are also on the anvil, says the report.

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