Prime Minister Narendra Modi on Monday assured West Bengal Chief Minister Mamata Banerjee that the Centre will leave no stone unturned in aiding the development of the State, but is understood to have been non-committal on her request for a debt waiver from the Centre.
Ms. Banerjee’s first meeting with Mr. Modi after he became Prime Minister comes against the backdrop of acrimony between her party Trinamool Congress (TMC) and BJP.
Seeking a special financial package for her debt-ridden State, Ms. Banerjee initially met Mr. Modi in Parliament House before calling on him again with a delegation of MPs from her party.
The West Bengal Chief Minister — who voiced concern over the funds pending for schemes like MNREGA and ICDS — said that Mr. Modi praised the State’s financial performance in raising the revenue and assured help in maintaining fiscal discipline.
“The PM said that Bengal’s loan was maximum in comparison to other States. But he appreciated our efforts in keeping the financial discipline… He also praised our efforts and hoped that financial situation will improve further.
“He (Modi) said we will try (to help) because the country is also facing a crisis on financial front. ‘We will try to see how we can help the State’ he said,” Ms. Banerjee told reporters.
However, according to a TMC MP who was part of the delegation, the Prime Minister was non-committal on the debt waiver issue.
At the meeting, Ms. Banerjee raised the debt problem, which she has said was mostly a result of the actions of the previous Left government.
“Today, all our party MPs met PM and before that I also met him. We apprised him of Bengal’s financial situation. We came to power in 2011 and the loan was taken before that.
“The loan was about Rs. 1 lakh crore from RBI. It was not our fault. The loan was not taken by us but by the previous Left government,” she said.
Saying that the debt burden, leading to high interest payments, was affecting the development expenditure in Bengal, she asked for debt relief and relief from interest payments.
“The Centre takes away all the money, so how will the State develop and how will the poor benefit? Road (building) work, food procurement, 100-day minimum work… how will it?” Ms. Banerjee said.
“We have sought waiver of the loan for carrying out development work,” the Chief Minister said.
Ms. Banerjee targeted the Left for the financial worries facing West Bengal, saying, “They were not following fiscal responsibility. But we are following financial discipline and our revenue collections have gone up. It was Rs. 21,000 crore, now we have doubled it.”
Meanwhile, according to a release issued by the Prime Minister’s Office (PMO), Mr. Modi explained to Ms. Banerjee during their meeting that he is a firm believer in cooperative federalism.
The Prime Minister has constantly been saying that only strong States can make a strong India and, therefore, States must be strengthened to meet the development needs of their people, the PMO said.
“West Bengal and Kolkata have to develop, for their own sake, and for the benefit of the region. That is why we have the ‘Act East’ policy. The region has talented people and a lot of resources. The Prime Minister Stated that he is fully committed to West Bengal’s and Kolkata’s development,” it added.
It is with this in view that the Centre has agreed to devolve 42 per cent of the divisible pool of taxes to States for the next five years. This is unprecedented and a rise from 32 per cent which is the current share, the PMO said.
In addition, the Centre has accepted other recommendations of the 14th Finance Commission relating to Revenue Deficit Grants and other Grants, it said, adding that, among the large States, West Bengal is one the most important beneficiaries of this decision.
Talking to reporters outside Parliament, Ms. Banerjee said, “We have sought funds which are the State’s due for food procurement, 100-day minimum work under MNREGA, and ICDS projects. We also raised the issue of pending railway projects with him (Modi) because many railway projects are stagnating in the State.
“He assured us help and said he is happy with Bengal’s performance.”
Asked whether she had raised the Teesta water issue with the Prime Minister, she answered in the negative.
According to statistics released by PMO, the major benefit for WB is the tax devolution in the next five years which, from 2015-16 to 2019-20, will be around Rs. 2,90,000 crore as compared to Rs. 1,06,000 crore in the last five years. This is an increase of Rs 1,80,000 crore, or a 174 per cent jump.
West Bengal’s share of taxes has been increased from 7.264 per cent to 7.324 per cent, it added.